Standard Admin / Tuesday, October 8, 2024 / Categories: Cyprus Company Governance, Articles Cyprus Employment Contracts - Specialised FAQs Cyprus Employment Contracts Specialised Cyprus Payroll Enquiries Asked by our International Clients affecting The below article aims to summarise the detailed FAQ information affecting Cyprus employment contracts terms and conditions affecting the rights of the Employer (Remote Cyprus employer or local Cyprus Employer) and the local employee registered under the Cyprus Payroll. Unlike our Cyprus clients who are more keen on knowing how much the net salary and total cost to their companies will be, our international clients who never had an employee in Cyprus are asking, rather very specific and sophisticated, payroll / employment contract related questions which require the response our specialist payroll managers. When drafting employment contract under Cyprus law you should consider some of the not so straightforward terms and conditions that apply to the Republic. To assist you, we have summarised the most commonly asked enquiries of our clients in an FAQ form for your ease and reference. If you need more information, send us an email at: kt@cyprusaccountants.com.cy or call me directly at + 357 99 428 543. In addition, there is a plethora of Cyprus payroll information, examples, calculators, tables and FAQs on our website. Click here to obtain direct access. FAQs: Cyprus Payroll & Employment Contract Enquiries by our International Clients Can we mention the Client in ROE model (Remote Overseas Employer)? Does it pose any Labour leasing risk? Yes, your company should be the employer as any other company eitherwise your company would be registered under a different status which requires special licensing etc. ================================================================================ Is the Garden Leave term is common/valid/legal in Cyprus? Yes ================================================================================ Moral rights are not defined under Cypriot laws. Should we keep the definition regardless of application in Cyprus (in Greece this is applied)? Remove it ================================================================================ Fixed Term Contracts Renewals in Cyprus A fixed-term contract or succession of consecutive fixed-term contracts between the same employer and same employee that lasts more than three years is presumed to be an open-ended contract. The same applies if more than three consecutive contracts are concluded within a three-year period. Contracts are considered to be consecutive if fewer than 45 days elapse between them. The renewal of a fixed-term contract lasting more than 10 days must be notified in writing to the employee. ================================================================================ What is the minimum/statutory term and can this be negotiated with the client? 6 Months ================================================================================ Can we mention the Client in ROE model (Remote Overseas Employer)? Does it pose any Labour leasing risk in Cyprus? Yes it does - do not mention EOR model ================================================================================ Is Travel undertaken outside normal working hours remunerated in Cyprus? Travel undertaken outside normal working hours is not separately remunerated in Cyprus + Its inclusion in the employment agreement does not make much sense; employees are remunerated via payslips in Cyprus -à in the event employees are working outside normal hours work they should be remunerated at an agreed rate. Consider redrafting this sentence in the Cyprus employment contract. ================================================================================ What happens when an employee is planning to work remotely from a country different to the Location stated above for more than 30 days, it is the Employee’s obligation to inform the Employer at least 2 weeks before the departure date? This is an internal company matter. ================================================================================ How many days of work are considered overtime in Cyprus? Do we have to specify that the EE will have a 40-hour work week or that if there will be any overtime required that the EE must have a rest period of 11 hours for the next subsection? Some websites state 40-hour work week and others state 44 hours as a standard (with anything above 40 being treated as overtime) The Company will determine internally whether a 40-hour week or more is your normal working hours and anything above that is considered overtime. ================================================================================ Shall we include in the employment agreement the bonus status? How are Cyprus courts treating disputed bonuses? Cypriot Courts are favourable towards employees in interpreting a bonus as part of the employee’s salary. Any clauses on agreements outside the employment contract may not be effective in preventing an employee’s claim that the bonus payments/undertaking are part of his/her salary so long as it was included in the employment contract. ================================================================================ An employee has to apply for sick pay 48 hours from the start of the leave. It is paid by the state. Can check if it is paid directly to EE or through ER. Paid directly to EE from Social Securities ================================================================================ How are severance payments in Cyprus calculated: up to 4 years of service, severance pay is two weeks for every 52 weeks of continuous employment. 5–10 years of service, two and a half weeks for every 52 weeks of continuous employment. 11–15 years of service, three weeks for every 52 weeks of continuous employment. 16–20 years of service, three and a half weeks for every 52 weeks of continuous employment. 21–2 years of service, four weeks for every 52 weeks of continuous employment. ================================================================================ What are the termination periods in Cyprus? 6 months -1year (yr): 1 week 1-2 yrs: 2 weeks 2-3 yrs: 4 weeks 3-4 yrs: 5 weeks 4-5 yrs: 6 weeks 5-6 yrs: 7 weeks >6 yrs: 8 weeks ================================================================================ Cyprus Employment Contracts: Non-Competition and Non-Solicitation clauses. What happens when they are challenged at Cyprus Courts? Cyprus Courts are reluctant to enforce non-compete provisions in employment contracts, subject to various factors and circumstances. Would you suggest to keep this nevertheless or it should contain some remuneration clause for non-compete and non-solicitation? Keep it, as most contracts include it! About Cyprus Audit Services (CYAUSE Audit Services) We provide payroll services and solutions to hubdreads of our clients (local, Remote Employers and International Interest Companies) on a monthly basis. Our payroll experts are using advanced payroll software to facilitate the needs of our international clients as well as their internal reporting deadlines. Being an audit and assurance firm payroll work is a rather routine work for us. Given the popularity of new payroll incentive shecmes where the payroll tax is halfed, our team has also obtained expertise in registering Companies from the EU and 3rd Countries to the Cyprus Social Securities and Payroll in an accurate and timely manner. Want to know more, feel free to contact me directly on kt@cyprusaccountants.com.cy. Thank you, Kyriakos Tramountanellis Print 373 Rate this article: No rating Tags: Cyprus companycyprusCyprus companiesRelocationemployerCyprus overseas employeremployeesCyprus relocationcypruslifecyprus payrollpayroll systemcyprus systemcyprus employementcyprus employement contracthiring in cyprusemployment controctrecruitment contract More links Cyprus Payroll - With Examples Please login or register to post comments.