Hiring in Cyprus: social insurance and employer duties

Cyprus makes it straightforward to employ people, provided you do the registrations before anyone starts. Miss the order and you create problems, follow it and payroll runs itself. Here is the full set of employer duties.

Register, then notify

An employer first registers in the Register of Employers of the Social Insurance Services using form YKA 01-001 at the local district office. Each recruitment must then be notified no later than one day before it starts, electronically through the ERGANI system at ergani.mlsi.gov.cy. Self-employed people register on form YKA 1-008 and usually receive a social insurance number within one to two weeks.

The contributions

For an employee, social insurance is 22.8% of insurable earnings, split as 8.8% employer, 8.8% employee and 5.2% state. Self-employed people pay 21.8% in total, of which 16.6% is theirs and 5.2% the state's. On top of the employee contribution, an employer also pays 1.2% to the Redundancy Fund, 0.5% to the Human Resources Development Fund and 2% to the Social Cohesion Fund. Contributions are due by the end of the calendar month following the month they relate to, and self-employed contributions are paid every three months.

The rules of employment

Since 1 January 2024 the national minimum wage is 1,000 euros gross for full-time employees, and 900 euros gross for the first six months of service. Employees must receive written terms of employment, the probation period is the first six months and can be extended to two years by agreement, redundancy rights apply after 104 consecutive weeks, and protection from unfair dismissal after 26 consecutive weeks. To hire an EU citizen you file form MEU1A with a fee of 20 euros per person and 20 euros for each family member who is also an EU citizen. Non-EU key personnel in companies of foreign interests need a minimum gross salary of 2,500 euros a month and a contract of two to three years.

Set up payroll properly

An accountant or a payroll service will register you, run the ERGANI notifications and file the monthly contributions, which is well worth it from the first hire. You will find both in our professional services directory, and the concierge can match you to one near you. Figures change, so confirm the current rates on the government portal. Source: Point of Single Contact, businessincyprus.gov.cy.