Cyprus Employment Guide

Cyprus is an island nation in the Eastern Mediterranean with a population of about 1.2 million. Its economy relies on services, tourism, shipping, and financial sectors. Employment in Cyprus is regulated under the Termination of Employment Law and the Employment Law, which cover working hours, leave entitlements, minimum wage, and termination rules. Employers must make social insurance contributions for employees covering pensions, health, and unemployment benefits. Employment contracts are required for all employees, and foreign nationals may need work permits depending on their nationality.

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Currency

Euro (EUR)

Capital

Nicosia

Official language

Greek and Turkish

Salary Cycle

Monthly

Our Employment Guide in Cyprus

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Navigating Employee Termination in Cyprus: A Guide for International Employers

Terminating employment contracts in Cyprus requires careful adherence to complex legal frameworks and country-specific regulations. The dismissal process must be handled collaboratively between employers and key stakeholders, often involving special considerations and mandatory procedural steps.

Legal Grounds for Termination

Cyprus employment law prohibits arbitrary dismissals, requiring employers to demonstrate valid justification for termination. Acceptable termination scenarios include:

Voluntary resignation by the employee
Mutual agreement between parties
Employer-initiated termination based on:
- Probationary period assessment
- Serious misconduct by employee
- Disciplinary dismissal procedures
Contract expiration

Employers must act promptly when termination becomes necessary. Delayed action following the emergence of termination grounds may render the dismissal unlawful. Legal consultation is essential to determine appropriate notice periods based on individual circumstances.

Notice Period Requirements

Cyprus mandates minimum notice periods that escalate with employee tenure:

Length of Service	Minimum Notice Period
Up to 51 weeks	1 week
52-103 weeks	2 weeks
104-155 weeks	4 weeks
156-207 weeks	5 weeks
208-311 weeks	6 weeks
312+ weeks	7 weeks

Severance Pay Regulations

Employees terminated through unlawful dismissal or employer misconduct qualify for statutory severance payments calculated according to service duration:

Under 4 years service: 2 weeks' wages
5-10 years service: 2.5 weeks' wages
11-15 years service: 3 weeks' wages
16-20 years service: 3.5 weeks' wages
Over 20 years service: 4 weeks' wages

Notably, employees who reach statutory retirement age before termination forfeit eligibility for severance compensation.

Practical Considerations for Global HR Teams

International companies operating in Cyprus should implement robust termination protocols. SailGlobal's case studies demonstrate how standardized dismissal checklists can prevent legal complications. For instance, a technology firm recently avoided wrongful termination claims by documenting performance issues systematically over six months before initiating dismissal procedures.

Regular compliance audits and local legal partnerships ensure termination processes align with Cyprus's evolving employment landscape. Proactive HR management minimizes risks while maintaining positive employee relations throughout separation processes.

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