Payroll and Benefits Guide Cyprus

Annual Leave (vacation)

The standard leave entitlement for employees who work a five-day week is 20 working days per year and for employees who work a six-day week is 24 working days per year. Additional annual leave days might be mandated within the Employment Contract or applicable Collective Bargaining Agreement. Entitlement for annual leave is once 48 weeks have been worked with a single employer.

It is permitted to carryover unused leave days providing there is mutual agreement to do so from both the employer and employee, capped at the maximum number of days of leave that an employee can accrue over 2 year period (i.e. 40 or 48 days).

An employee’s wages during the annual leave period is paid either by the employer directly or by the Central Holiday Fund.

PTO carryover

In Cyprus, statutory annual leave is generally meant to be used in the year it’s earned. However, unused leave can be accumulated/carry over for up to two years by mutual agreement between employer and employee. If the employer refuses to grant leave or the employee couldn’t take it (e.g., due to circumstances beyond their control), EU law principles require that annual leave rights must still be preserved and not extinguished just because the year ended. Employees who leave their job must be paid for any unused statutory leave.

Public Holidays

Public holidays that fall on the weekend are usually lost.

Sick Days

Employees are entitled to paid sick leave from the fourth day of sickness, paid for by Social Security. The employee must submit a medical certificate to the Social Security Administration within 48 hours of the start of the sick leave. The  social insurance covers sick pay up to a period of 312 days at 60% of salary (the % of salary might increase where there is a dependent spouse and children).

Maternity Leave

Female employees are entitled to 18 weeks of maternity leave for the birth of their first child, 22 weeks maternity leave for the birth of their second child and 26 weeks maternity leave for the birth of all subsequent children. It is compulsory to take 11 weeks of maternity leave and are generally taken 2 weeks before the due date and the remainder after.

The amount of the maternity allowance is determined based on the weekly average of actual and simulated insurable earnings of the insured within relevant tax year. The maternity allowance includes a basic allowance and a supplementary allowance. The weekly amount of the basic allowance is equal to 72% of her salary, rising to 80%, 90% or 100%, when the beneficiary has one, two or three dependents, respectively. If the beneficiary receives part of her earnings from her employer for the period she is entitled to maternity benefit, the benefit is reduced so that the sum of the allowance and emoluments she receives not to exceed her full emoluments.

The application for maternity benefit must be submitted within 21 days of the day from which the allowance is required. Submitting the application for maternity allowance takes place immediately after completing the twenty-fifth (25th) week of pregnancy. Workers must also inform their employers of pregnancy in advance and provide a medical certificate which indicates the expected due date.

Paternity Leave

Fathers are entitled to 2 consecutive weeks of paid paternity leave within the 16 weeks following the birth of a child, paid by the Social Insurance Fund at 75.20% of the employee’s regular salary.

Parental Leave

The right to parental leave covers all employees who have children under the age of 8. According to the law, every eligible employee can take unpaid parental leave of up to eighteen weeks for each child.

Other Leave

Depending on collective bargaining agreements or the employment contract, an employee may be allowed additional leave types.
Bereavement: Employees are entitled to up to 5 days of paid leave due to a death of a direct family member.
Adoption: Employees who want to adopt a child under the age of twelve years are entitled to up to 16 continuous weeks’ leave starting from the date they begin to take care of the adopted child.
Military: Employees called to perform military service are covered by assimilated insurance (Social Insurance Services).