After rebounding from the 2012–2013 Cypriot financial crisis that rocked the small island country’s economy, Cyprus has emerged as a premier destination of choice for multinational companies (MNCs) for investment, expansion and hiring. Positioned at the crossroads of Europe, the Middle East and North Africa, the country is a major for financial services, shipping and technology and is also becoming a top destination for cross-border venture capital activity. In particular, MNCs are attracted to Cyprus’s young, highly-educated talent pool and global market access.
- Cyprus hosts the European Union’s youngest workforce and also ranks among the highest for university education attainment, with 41% of 25–74-year-olds having tertiary education compared to the EU average of 30%.
- More than 70% of the Cypriot population speaks English and the island attracts expat talent from around the world.
- The country is ranked 24th out of 64 countries by the IMD World Talent Ranking, earning particularly high marks for its investments in education and workforce development.
- The government developed a modern transparent and efficient tax system fully in accordance with EU and international regulations. With one of the lowest corporate tax rates in the EU, Cyprus has a reputation for being low-cost and business-friendly.
- Cyprus is an attractive global hub for MNCs, with Amazon recently establishing a data service center in Nicosia and many anticipate the e-commerce giant will eventually choose the island country for its EU headquarters. Other MNCs headquartered in Cyprus include NCR, Kardex, Wargaming and eToro.
How does hiring in Cyprus differ from other countries?
HR processes and regulations in Cyprus may differ from the norms and expectations of other jurisdictions, even other EU countries. When building a team locally, it’s important to understand that the Cypriot job market is highly candidate-driven. While Cyprus’s workforce is highly educated and developed, the country’s population is only about 1.2 million people. Even with a steady supply of global talent, qualified professionals with certain technical skills can sometimes be in short supply. Supplementary benefits can help employers gain a competitive advantage and secure top talent.
Do MNCs need to be aware of any special regulations when hiring expats in Cyprus?
Labor laws in Cyprus vary based on the status of the employee being hired. For instance, when hiring foreign nationals, employers must adhere to the Alien and Migration Law. If a company is hiring EU nationals, it must comply with relevant EU documents such as the Law on Free Movement. All other types of employment are governed by the Cypriot Department of Labor and the Civil Registry and Migration Department.
What role do unions play in Cyprus?
Employers should be aware that trade unions and collective bargaining agreements are fairly common. This impacts how HR processes are conducted, including but not limited to notice periods and terminations.
What do MNCs need to be aware of when it comes to workplace safety?
Employers in Cyprus are required to carry out preventative measures against injury at work without any financial costs to the employee, including the evaluation of occupational risks and properly outfitting the workplace. Relevant health and safety training should also be given to all employees throughout the employment relationship.
What makes hiring in Cyprus challenging?
Employment law in Cyprus can be cumbersome and complex, as compliance regulations are derived from a myriad of sources. These include the Termination of Employment Law of 1967 (amended), Social Insurance Law of 1980 (amended), Annual Paid Leave Law of 1967 (amended), Protection of Maternity Law of 1997, Minimum Salaries Law (amended), Equal Treatment at Work and Employment Law of 2004 (amended), Health and Safety at Work Law of 1996 (amended), the Collective Redundancies Law of 2001 and more.
Why are some MNCs turning to the Employer of Record hiring model in Cyprus?
While MNCs want to capitalize on Cyprus’s cost-effective, talented workforce, it can be difficult for a cross-border HR department to keep pace with the various statutes that regulate employment relationships. Companies are increasingly turning to the Employer of Record (EOR) hiring model because it allows them to build a team in Cyprus without having to learn all of the nuances of Cypriot labor law.
How can partnering with GoGlobal help MNCs hire and build a cross-border team in Cyprus?
Cyprus offers favorable economic conditions and a young, innovative talent pool that can help companies grow internationally. However, nuances in regulatory compliance and the country’s notoriously competitive labor market can make it difficult for MNCs to build a team in Cyprus.
GoGlobal confronts these challenges by assuming most of the risks and responsibilities of hiring in Cyprus. Apart from managing the burdensome administrative tasks and payroll requirements, we can also help an MNC tap into the country’s competitive labor market by building a winning supplementary benefits package that attracts top talent.
What makes the GoGlobal experience unique?
When we take the wheel on HR processes, our clients can then focus on core business initiatives without being slowed down by bureaucracy and evolving regulations.
Our innovative EOR team has a proven track record of success in building fully compliant workforces in the EU, offering expertise on the region’s complex and evolving regulatory compliance frameworks. This includes the General Data Protection Regulation as well as other EU regulations that employers in Cyprus are bound to. Notably, we also have experts in the Middle East and North Africa (MENA) markets that are Cyprus’s neighbors and trading partners.
How does GoGlobal approach HR processes?
At GoGlobal, we take great pride in embracing a global mindset but we also maintain a team of local experts on the ground in every market we serve. Our dedicated team in Cyprus knows the “ins and outs” of the country’s regulatory environment. At the same time, they are also experts in navigating Cyprus’s unique labor market conditions and business culture. This ensures a positive experience for clients as well as client workers.
Before we begin the onboarding process, our onshore team in Cyprus will meet with each newly hired team member to explain how the EOR arrangement will work. Throughout the arrangement, that same dedicated team remains the point of contact for both the client and client-employee. We are always ready to address questions that come up in the areas of payroll, taxation or benefits.