On this Page:
- Cyprus Regulatory Environment
- Cyprus Work Permits
- Cyprus Social Security
Regulatory Environment
Until the installation of the EU acquis
communautaire, labour regulation in Cyprus
was very light.
Much pay bargaining is traditionally carried
out directly between employers and employees;
however there has also been some collective
bargaining between trade unions and employers'
organizations, and the Government has been
known to take part in tri-partite resolution
of disputes.
Due perhaps partly to the island's economic
success, and the fairly hardworking and practical
ethic of Cypriots, the number of man-days
lost each year to strikes at about 70 per
100,000 was historically very low by normal
OECD standards.
Recently, however, striking seems to have
become more popular, perhaps because of strains
induced in the labour market by EU entry.
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Cyprus Work Permits
Work permits for foreigners are issued under
the Alien and Immigration Laws and Regulations,
by the Migration Office (but see Entry and Residence as regards Temporary Residence
Employment permits for expatriate employees).
Work permits are normally issued to foreigners
only when no suitably qualified local staff
are available.
Under a law implemented in July 2000, foreigners
in Cyprus must either have a five-year work
permit or have worked on the island for five
years or have a combination of worked time
and work permit totalling a minimum of five
years before their spouses can join them.
But in November 2000, the Cyprus government
introduced new regulations designed to make
it easier for some foreigners to have their
loved ones live with them. However, this solely
applied to those EU nationals and non-Cypriots
who work in certain sectors: offshore workers,
reporters, foreign correspondents, accountants
with big firms, lecturers, teachers and those
who have invested a designated amount in local
businesses.
The five-year permits would be automatically
granted to new foreign entrants into these
sectors and those renewing permits would be
given extensions long enough to enable them
to meet the 'five years in total' clause,
the government revealed.
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Cyprus Social Security
There is a mandatory earnings-related social
security scheme in Cyprus which applies to
both employed and self-employed individuals,
whether resident or not, and whether Cypriot
or not. However, non-resident employees of
offshore entities are excluded. Self-employed
persons are assessed on notional income levels
depending on their occupation.
Contributions to the various funds are tax-deductible,
and the employer's contribution is not taxable
for the employee.
Benefits include a normal range of income
and lump-sum payments.
The maximum salary amount on which social
insurance contributions are estimated is set
by the government, from April 2009, is around
EUR48,048.
– contributions by employer |
6.8% |
– contributions by employee |
6.8% |
|
– self-employed contributions |
12.6% |
– employer's contribution to Redundancy
Fund and Industrial Training Fund |
1.2% and 0.5% |
– employer's contribution to Holiday
Fund |
8% |
NB The Defence Levy as such was abolished
under a new taxation package agreed by Parliament
in July, 2002, but various types of unearned
personal income are subject to a defence tax
between 3% and 15%.
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