Bosnia and Herzegovina Employment Guide

Bosnia and Herzegovina is located in Southeast Europe, in the central part of the Balkan Peninsula. It borders Croatia to the north, Serbia to the east, and Montenegro to the south. With a population of approximately 3.3 million, its economy is dominated by services, industry, and agriculture, while tourism has gradually developed in recent years. Sarajevo, the capital, serves as the political, economic, and cultural center. The country’s labor laws require employment contracts to be in writing, with a standard 40-hour workweek. Employers are obligated to guarantee the minimum wage, social insurance, and paid leave. Dismissals must follow legal procedures and involve compensation payments to employees. Its labor relations system is relatively stable, and it has a certain appeal to foreign-funded enterprises.

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Currency

Convertible Mark (BAM)

Capital

Sarajevo

Official language

Bosnian, Croatian, and Serbian

Salary Cycle

Monthly

Our Employment Guide in Bosnia and Herzegovina

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Minimum Wage Requirements in Bosnia and Herzegovina

Employers operating in Bosnia and Herzegovina must adhere to the national minimum wage regulation, which is currently set at 996.78 Convertible Marks (BAM) per month. This baseline compensation applies to all full-time employees across various industries.

Personal Income Tax Structure

The personal income tax system employs a flat rate of 10%. Taxable income is calculated after deducting social security contributions and applicable personal allowances. While the rate is uniform, final tax liability can be influenced by individual circumstances such as family dependents, which may qualify for additional deductions.

Employer Payroll Cost Breakdown

Beyond gross salary, employers should budget for additional statutory contributions averaging approximately 15.15% of the employee's wage. These mandatory costs cover social security and other employment-related taxes.

Monthly Employer Contributions

Contribution Type	Rate/Amount
Pension and Disability Insurance	10%*
Health Insurance	5.15%*
Unemployment Insurance	0.5%
Work Injury Insurance	0.5%
Natural Disaster Tax	0.5%**
Water Tax	0.5%**
Work Facility Maintenance Allowance	BAM 78.93
Secondary WFM Allowance	BAM 82.12

*Calculated on maximum assessable base salary of RSD 573,470 monthly
**Applied to 0.62 of gross wage

One-Time Employment Costs

Mandatory wet-ink employment agreement processing fee: $80

For precise calculations tailored to specific employment scenarios, consulting with SailGlobal's HR compliance specialists is recommended.

Working Hours and Overtime Regulations

The standard workweek consists of 40 hours, typically distributed as eight hours per day from Monday through Friday. Any work exceeding these limits generally qualifies for overtime compensation, though specific premium rates are determined by collective bargaining agreements or employment contracts.

Companies expanding into the Bosnian market should note that regional variations may exist between the Federation of Bosnia and Herzegovina and Republika Srpska. SailGlobal's localized expertise helps multinational employers navigate these subtleties while maintaining full compliance.

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