Taxes and payrolls: the peculiarities of the Greek labour market
Each labour market has some peculiarities. It may be tricky for foreigners to understand fully the payment methods, the taxes and other benefits related. In TalentUp we are starting a series of different blog articles, one for each country. This article analyses the Greek labour market.
General data about the Greek labour market
| Minimum wage | 780€/month |
| Payment basis | Monthly |
| Payment | Must be paid by the last working day of the month |
| Maximum working hours a week | 40h |
| Maximum overtime hours a week | 8h |
| Maximum overtime hours a year | 150h |
| Working hours compensation | 120% pay rate, 125% pay rate if it is at night and 140% pay rate if it is more than 2 extra hours in the same day |
In accordance with Greek legislation, employees working in the private sector have the right to receive two extra monthly wages distributed across three instalments: a full monthly salary for Christmas, half a monthly salary for Easter, and another half monthly salary for the Vacation Bonus. It is mandatory that these bonus payments are provided exclusively in cash and not in kind.
The Christmas Bonus payment must be disbursed no later than December 21st.
Payroll taxes in Greece
Social security contributions are made by the employer and the employee and are used for funding unemployment, pension, maternity/paternity leave, and sickness or injury.
| Contingencies | Employer % | Employee % |
| Pension fund | 13.33% | 6.67% |
| Health Care | 4.30% | 2.15% |
| Health in Benefit | 0.25% | 0.40% |
| Supplementary Insurance | 3.25% | 3.25% |
| Unemployment | 1.20% | 1.20% |
| EFKA summer campsite programs | 20€/year | |
| Total | 22.31% + 20€/year | 13.67% |
All contingencies except pension fund have a max limit on employee salary 7,126.94€.
Once contributions are paid, employees need to pay an income tax that varies depending on their gross salaries.
| Gross salary | Income tax |
| Up to 10,000€ | 9% |
| From 10,001 to 20,000€ | 22% |
| From 20,001 to 30,000€ | 28% |
| From 30,001 to 40,000€ | 36% |
| Over 40,001€ | 44% |
Example of net salary in Greece
As a reference, we use the average salary of a software engineer. In Greece, on average, software engineers earn annually 43,400€.
| Employer | Employee | |||
| % | € | % | € | |
| Gross salary (annually) | 43,400 | |||
| Pension fund | 13.33% | 5,785.22 | 6.67% | 2,894.78 |
| Health Care | 4.30% | 1,866.20 | 2.15% | 933.10 |
| Health in Benefit | 0.25% | 108.50 | 0.40% | 173.60 |
| Supplementary Insurance | 3.25% | 1,410.50 | 3.25% | 1,410.50 |
| Unemployment | 1.20% | 520.80 | 1.20% | 520.80 |
| EFKA summer campsite programs | 20 | |||
| Total | 22.31% | 9,711.22€ | 13.67% | 5,932.78€ |
| Income tax | 8,588.20€ | |||
| Net salary (annually) | 28,879.02€ |
The employer contributes 9,711.22€ to social security and the employee 5,932.78€.
After paying the income tax, the employee has a net salary of 28,876.02€ coming from a gross salary of 43,400€.
Unemployment regulation in Greece
If the contract is terminated by the employer, the notice period is as follows:
| Time worked | Notice period |
| Between 1 and 2 years | 1 month |
| Between 3 and 5 years | 2 months |
| Between 6 and 10 years | 3 months |
| More than 10 years | 4 months |
The amount of severance is based on the length of the employee’s service:
| Time worked | Severance pay |
| Between 1 and 4 years | 2 months |
| Between 4 and 6 years | 3 months |
| More than 6 years | 4 months |
No severance is required when the worker resigns. The probation period lasts 1 year.
Different kinds of leaves in Greece
The have twenty working days of paid holiday on the first year worked, 21 on the second, and 22 from the third on. After 10 years working for the same employer, they receive 25 working days. And after 25 years working for that same employer, they receive 26 days.
They have 11 public holidays. However, if they fall on the weekend, they are lost.
Sick leave depends on the time being employed:
| Time worked | Sick leave |
| Less than 1 year | 3 days at half pay and 15 days of paid sick leave |
| Between 1 and 4 years | 1 month |
| Between 4 and 10 years | 3 months |
| Between 10 and 15 years | 4 months |
| More than 15 years | 6 months |
Other leaves in Greece:
- Marriage Leave: 5 days.
- Bereavement Leave: 2 days.
- Caretaker Leave: 5 days.
- School Leave: For every child up to 18 years of age who attends school, both parents may be absent from work 4 working days per year.
Paid parental leave
Maternity leave lasts for 119 calendar days: 56 before the birth and 63 after it.
The initial month of maternity benefit is covered entirely by the employer, offering 100% of the employee’s regular salary rate. Subsequently, starting from the second month, both the employer and e-EFKA contribute to the benefit, providing 50.00% of the regular salary rate (based on the insured person’s insurance contribution class). In addition, child benefits are included for each child.
Furthermore, a supplementary maternity allowance is granted from the second month, which equals the difference, if any, between the salary rate paid by the employer and the maternity benefit.
For employees who lack insurance coverage, a fixed standard maternity benefit of 220.10 EUR is provided.
Every working father is entitled to 14 working days of paid paternity leave. Only two days can be taken before the birth.
Parental leave is available to any parent having completed one year of service, equal to four months (continuously or intermittently, as agreed with the employer) until the child reaches eight years old.
Other common Greek benefits
| Benefit | % of companies with this benefit |
| Professional development | 19.7 |
| Health Insurance | 16.1 |
| Cutting Edge Technology | 14.3 |
| Work From Home | 7.2 |
| Equal Opportunity Employer | 5.2 |
How to employ a Greek worker
The most well-known method of paying Greek remote workers is also the most labor-intensive. If you want to pay your workers yourself, you must create a legal entity in Greece. This entity will act as a branch of your company in Greece, and you’ll manage all financial and tax concerns for your Greek employees through this entity.
Some platforms (Papaya Global among them) offer the Employer of Record (EoR) service helping companies hire countries where they do not have any office.
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