Hiring in Albania

Contributions & taxes

How much are the contributions & taxes?

The Employee contribution is at the rate of 11.2%, they are composed of 9.5% social insurance and 1.7% health insurance contribution. Employers are responsible for contributing to social security at a rate of 16.7% for their employees.

Employer tax

15% of the employer payment goes for social insurance, and 1.7% goes toward health insurance. For social contributions, the minimum and maximum monthly salaries are ALL 32,000 and ALL 141,132 respectively. The employer deducts and reimburses the social security contributions.

Corporate tax

Albania has a 15% corporate income tax (CIT) rate. When taxable income is subtracted from deductible expenses, the CIT is applied to the remaining taxable profits.

Employee tax

The rate of social security contributions paid by employees is 11.2%. 9.5% of the employee contributions go for social insurance, while 1.7% go toward health insurance. Employers are responsible for contributing to social security for their employees at a rate of 16.7%.

Income tax

Individuals’ incomes are used to calculate personal income tax. 

During the tax period, all sources of personal income for residents are liable to personal income tax. 

For sources of income originating in the Republic of Albania, non-resident individuals are subject to personal income tax for the tax period.

1. For a monthly salary between 0 and 30,000 ALL: there is no tax;
2. For a monthly salary between 30,000.01 and 50,000.00 ALL: 50%, 13% of the amount;
3. For a monthly salary between 30,001 and 200,000: 13% of the amount;
4. For a monthly salary of more than 200,001 ALL: 22,100+23% of the amount.

Payroll

What is the payroll cycle?

The payroll cycle in Albania is generally a monthly cycle, with wages paid by the last working day of each month. However, hourly, weekly, and daily-paid employees are paid every two weeks.

Is there a 13th salary in Albania?

There is no 13th salary in Albania.

Labor rules

What are the main labor rules?

Probation period rules

In Albania, the standard probationary period is three months. Both the employer and the employee may end the job during the probationary period with five days’ notice.

Notice period 

Following the probationary period, the following notice is necessary: 

• One month in the first year of employment 
• From two to five years: two months 
• Over five years: three months 

Different notice periods may be specified by the employment contract or collective agreement, but they cannot be less than two weeks if the employee has worked for six months or longer, or less than one month if they have worked for more than six months.

Severance pay

Employees who have worked for a company for over 3 years are entitled to 15 days’ severance pay.

Leave and benefits

Leave and benefits rules

Public holidays

There are 13 official holidays in Albania:

1. New Year’s Day
2. Summer Day
3. Nowruz
4. Catholic Easter
5. Orthodox Easter
6. May Day
7. Eid al-Fitr
8. Mother Teresa Day
9. Eid al-Adha
10. Independence Day
11. Liberation Day
12. National Youth Day
13. Christmas Day

Sick leave

Employees are generally entitled to 14 days of sick leave, paid at an 80% rate by the employer. Employees who are injured at work can receive compensation from social insurance.

In general, employers must pay 80% of the cost of an employee’s 14 days of sick leave. Social insurance can provide benefits to workers who have injuries at work.

Maternity leave & paternity leave

Pregnant women who have worked for 12 months straight are eligible for up to a year of paid maternity leave, with at least 35 paid days prior to childbirth and 63 paid days following childbirth. The worker has 63 days to decide whether to stay on leave or come back to work. Three hundred ninety days of maternity leave are due to women who are expecting multiple children.

The first six months of maternity leave are compensated at 80% of the employee’s yearly average monthly wage. According to article 104 of the Labour Code, maternity pay is decreased to 50% for the subsequent six months.

Paternity leave is not currently mandated in Albania. However, a proposed modification to the Albanian Labour Code and Social Security Law (96.3) was filed in October 2020 to grant dads the right to three days of paid leave. 

In Albania, parental leave consists of 12 days of paid time off to care for a kid. Employees with children under the age of three are entitled to an additional three days of leave and may seek up to thirty additional days of unpaid leave each year if it is necessary to provide for the child.

Other leave (marriage, bereavement, exam leave)

Bereavement leave

An employee is entitled to two days of leave in the event of the death of a close relative.

Marriage leaves

An employee is permitted to take five days off if they get married. It is two days of leave for the union of a child.

What are the minimum vacation days?

It is not permitted to substitute a week or more of paid vacation time for the mandatory minimum of 20 days that each employee is entitled to. There may be a provision allowing for extended vacation time in the employment contract or collective bargaining agreement.

Insurance

Health security & private insurance

Payroll taxes and the general budget are used to fund Albania’s mandatory universal healthcare system. 

*Native Teams can support you in finding the best private insurance in the country. Contact us and we will send a comparison of insurance packages and prices.*

Visa

Relocation and work permits

Native Teams will apply for your work visa in the nation on your behalf and serve as your Employer of Record. All the required documents can be uploaded using our app. Until you have your work and residency visa, Native Teams will support you by providing you with frequent information on the progress.

How long is the visa/work permit process?

2 to 4 weeks depending on the authorities and provided documents.

Which documents do you need?

To apply for a visa/work permit in Albania, upload the documents from our onboarding list (relocation to log in/pricing).

Why use Native Teams for hiring in Albania?

Native Teams lets you employ team members ‘like a local’ meaning you get all the benefits of a global team, wherever you are based. Here are the reasons why you should use Native Teams for hiring:

• No paperwork: We will handle all the necessary paperwork for you.
• Save on taxes: We help you handle your taxes.
• No company set up: You can expand your business using our company entitles.
• Online onboarding: We’re here to ensure your onboarding process is trouble-free.
• No accounting: We will handle all of your accounting needs, including invoicing, payroll, and more.
• Increase your profit: We assist you in growing your business and maximizing your profits.
• Compliance expertise: we can assist your company in navigating the regulatory environments and ensure you meet all relevant requirements.
• Local support: We can assist you in understanding and complying with the relevant local laws.

*Note: The provided information was accurate at the time of writing.