Hiring guide in Albania

What should I know about hiring in Albania?

Legal requirements for hiring in Albania

The following are the most important legal requirements for hiring employees in Albania:

Legal framework

Types of employment contracts

Employment contracts in Albania are categorised into two main groups: individual employment contracts and collective employment contracts. Each of them serves a distinct function within the employment relationship and provides for different rights and obligations.

Collective employment contracts are agreements between one or more employers and employee unions governing the employment terms for a large group of employees. These contracts often focus on industry-wide issues such as wages, working hours, benefits, and dispute resolution.

Individual employment contracts, on the other hand, are signed directly between the employer and the employee, specifying terms such as the type of work, duration of contract, and remuneration. The most commonly used types are indefinite-term contracts for permanent employment, fixed-term contracts set for a specific period of time, part-time employment contracts for working fewer hours than the standard full-time arrangement, work-from-home employment contracts for working from remote locations, and others.

Content of an employment contract

The Albanian Labour Code specifically outlines the mandatory elements and formalities that must be included in an employment contract.

First of all, employment contracts must be in written form to ensure that the rights and obligations of both parties are documented, transparent, and legally enforceable. Employment contracts must also contain elements like identification of the parties, workplace, job description, start date, contract duration, paid leave, termination and notice period, and other essential information.

Download a free employment contract for Albania through Native Teams.

Oral, written or electronic employment contracts

The Albanian Labour Code recognises the validity of employment contracts in three different forms – written, oral, and electronic. However, the Labour Code imposes specific requirements and limitations on each type to ensure compliance and protect the parties’ rights.

Written contracts are the most common and recommended form of employment agreement. The Labour Code mandates that certain elements must be included in written employment contracts, like the identity, workplace, job position, duration of employment, starting date, basic salary and payment schedule, working hours, and annual paid leave entitlements.

Oral employment contracts are also legally recognised, but very restricted in scope. An oral contract is deemed valid only for periodic work that doesn’t exceed one week, and after this period, employers must formalise the relationship through a written contract.

Electronic contracts are considered valid if they meet the standard contractual requirements and bear an electronic signature. They are governed under the same statutory protections as written contracts and must meet specific criteria for authenticity and security. Such contracts provide convenience and flexibility, especially for remote work arrangements.

Working hours

The standard daily work duration in Albania is limited to eight hours, and employers and employees have the right to establish precise schedules within this framework through individual or collective agreements. Hence, the maximum standard workweek in Albania is 40 hours, typically divided across five days.  

Albanian labour law also mandates specific breaks based on the number of hours worked in a single shift. Employees working more than six hours continuously are entitled to an unpaid break of at least 20 minutes, which must be granted after the third hour but before the end of the sixth hour. For longer shifts, employees receive an additional 20-minute break. 

Overtime work in Albania is defined as any hours worked beyond the standard daily (eight hours) or weekly (40 hours) limits. However, the legal annual cap is 200 overtime hours, with a weekly limit of 48 hours. 

Overtime compensation includes regular wages plus an additional 25% for hours worked beyond the standard work schedule. Also, overtime on official holidays and weekends requires a premium rate of at least 50% above regular wages, either through added pay or equivalent leave.

Night work

The Albanian Labour Code defines night work as tasks performed between 10:00 pm and 6:00 am. This distinction establishes a legally recognised period during which different rules and protections apply to employees working during these hours.

Employees assigned to night work may not exceed an eight-hour work period during the night shift. This rule includes work performed immediately before or after night hours and mandates uninterrupted rest either directly before or after the night shift. 

The Labour Code identifies an employee as a night worker if they perform at least three hours of their work within the designated night period. Alternatively, if an employee works a significant part of their annual working hours at night, they are also considered a night worker. This classification is important to align the employee’s work schedule with the benefits and protections for night workers.

Breaks and types of leaves

In Albania, employment laws outline a series of regulations to ensure that workers receive adequate breaks, rest periods, and leave entitlements.

According to the Labour Code, employees are entitled to a minimum daily rest period of at least 11 hours without interruption. This ensures that employees have an extended period to recover from their daily duties, especially in cases where work might extend over two consecutive days. 

When it comes to weekly rest periods, employees are entitled to a minimum weekly break of 36 consecutive hours, which must include at least 24 hours of uninterrupted rest, typically on Sunday.

Annual leave

Annual leave regulations in Albania provide employees with paid time off to rest, rejuvenate, and manage personal matters without compromising their income. The Albanian Labour Code mandates that annual leave for employees must not be less than four calendar weeks per year, not including official holidays. However, employees who have not completed a full working year are granted leave on a pro-rata basis, determined by their employment duration.

Public holidays

Public holidays in Albania are observed in alignment with the Albanian Labour Code, which designates a set list of days when employees are entitled to rest. Public holidays are categorised into three main types – national holidays, religious holidays, and secular holidays.

The annual list of public holidays is generally static, but additional holidays may be recognised under specific circumstances.Some of the most popular public holidays in Albania are Independence Day, Liberation Day, Christmas, Easter, Eid al-Fitr, and New Year’s Day.

Salary

The Albanian Labour Code defines salary as the basic compensation an employee earns, along with any permanent increments. 

Employees are entitled to at least the minimum wage set by the Council of Ministers, which takes into account economic factors and living standards. The Albanian labour law also mandates payment timeliness and permissible deductions from salary, including taxes and union dues. Salaries must be paid monthly unless otherwise agreed upon, and any deductions must be explicitly authorised by the employee or legally mandated.

To calculate the salary and taxes in Albania, click here.

Sick leave

Employee absences due to sickness are protected under Albanian labour law to ensure that employees are entitled to compensation and job security during health issues.

An employee unable to work due to illness is entitled to 80% of their regular salary for 14 days, a period that is not covered by social insurance benefits. For an employee to secure this sick leave benefit, they must present a medical certificate issued by a licenced doctor verifying their inability to work.

Parental leave

Albanian Labour Code provides detailed regulations on parental leave, specifying eligibility, leave duration, and employer obligations. According to the Labour Code, eligible employees have the right to unpaid leave to care for children, recognising the essential role of family care.

To qualify for parental leave, the employee must have completed one consecutive year of employment with the same employer. Such employees are entitled to a minimum of four months of unpaid parental leave, available until the child turns six years old. This entitlement is per parent, and leave rights are non-transferable, with an exception in cases when one parent passes away.

In cases of adoption, the entitlement to parental leave applies from the date of adoption, extending up to six years but not beyond the child’s twelfth birthday.

Paternity and maternity leave

Maternity leave in Albania is a legally protected right designed to support employed women through childbirth. Mothers are entitled to paid maternity leave for 12 consecutive months, including 35 days before childbirth and 63 days following childbirth, after which the mother can choose to either stay on leave and receive social insurance benefits or return to work.

Women who return to work after the initial 63-day period are entitled to flexible working hours to accommodate breastfeeding needs. This includes either taking a two-hour paid break within her working hours or working two fewer hours per day while receiving full pay until the child reaches the age of one.

When it comes to paternity leave, fathers are entitled to three days of paid paternity leave.

Methods of employment termination

There are a few types of terminations in Albania, accommodating both employer and employee needs while safeguarding their rights. 

Depending on the employment type, fixed-term or indefinite-term contracts include different grounds and procedures for termination, including normal termination, immediate termination for cause, mutual termination, and collective dismissal. 

Normal termination for indefinite-term contracts requires that the employer provides a legitimate reason for the dismissal, including the employee’s job performance or ability, the employee’s behaviour, or the operational needs of the business.

Immediate termination for cause requires a “good” cause to justify the employer’s decision, which can include serious circumstances that make it unfeasible to continue employment, serious breach of contractual duties, and minor breaches of contract despite written warnings.

The termination of fixed-term contracts follows distinct rules, including the expiry of the agreement, immediate termination for cause, and early termination.

Ordinary dismissal by employer

Ordinary dismissal refers to the process by which an employer ends an employment contract based on non-immediate grounds, which can include an employee’s conduct, capability, or the company’s operational requirements. 

Albanian law permits two primary methods of contract termination by an employer – termination by notice and termination with immediate effect.

Termination by notice requires employers to provide advance notification, which allows employees to continue working and receive remuneration for the stipulated notice period. On the other hand, immediate termination is reserved for instances of serious breaches or repeated non-compliance by the employee despite prior warnings. The Labour Code waives the notice period in such cases.

Notice period and challenging the dismissal

Notice period in Albania is based on employment duration, ranging from two weeks for employment lasting up to six months to two months for employment beyond five years. These timelines ensure a balance between the stability of long-term employees and the employer’s right to end the contract within a reasonable timeframe.

The process of challenging dismissal involves several key aspects, which are ensuring a balanced approach to employee rights and employer obligations. Hence, besides the ground for termination and notice period, employers are obligated to conduct a pre-dismissal meeting, during which the employee is informed in writing of the reason for termination. Employers can also enact an immediate dismissal in cases of severe misconduct, but such dismissals are subject to strict scrutiny.

Rights and obligations of unemployed individuals

In Albania, the primary rights of unemployed individuals include access to unemployment benefits, healthcare provisions, and participation in employment promotion programmes. These rights are accompanied by responsibilities aimed at encouraging proactive job-seeking and compliance with established processes. 

Unemployment benefits in Albania provide temporary financial support to encourage individuals to re-enter the workforce through job-seeking or retaining activities. However, the Law on Social Insurance of 1993 defines the eligibility requirements and benefits structure for such individuals.

Unemployed individuals retain their right to healthcare services to ensure continued access to essential healthcare during period of unemployment. The government’s social insurance programme generally funds these healthcare benefits.

The Albanian government also promotes employment programmes designed to reintegrate unemployed individuals into the country’s workforce. These programmes provide training, skill development, and job placement services, all of which enhance employability. Unemployed individuals are often required to participate in these programmes as a condition of receiving unemployment benefits. However, the Albanian law also places specific requirements on unemployed individuals to actively search for employment.

Severance pay

Severance pay is a statutory right in Albania for certain categories of employees. It is typically available to employees who are terminated due to reasons unrelated to their conduct, such as redundancy or company restructuring. 

The amount of severance pay depends on the duration of the employment with the specific employer. While the Labour Code provides baseline calculations, some specific collective agreements or individual employment contracts may set higher entitlements.

Employers must provide severance pay to eligible employees promptly following termination. Failure to comply with these obligations can result in legal penalties, as Albanian labour laws impose strict guidelines on severance entitlements.

Probationary period

The Albanian Labour Code sets guidelines for the probationary period, detailing its duration, conditions for termination, and the flexibility permitted within the contractual relationship.

The probationary period is limited to three months and can not be extended beyond this period. However, both parties have the right to negotiate a shorter probationary period and customise the terms based on individual or organisational needs.

During the probationary period, either party may terminate the contract with a five-day notice. An important aspect of this is that neither party is required to provide a reason, which allows greater flexibility in hiring and early termination decisions.

Prohibition of competition

Employment contracts in Albania often include non-compete clauses that restrict former employees from engaging in competing activities after their employment ends. 

Non-compete agreements are enforceable only for employees over the age of 18, and must be in written form, typically included in the contract, to be valid. A crucial criterion for enforceability is that the employee must have had access to confidential information or professional secrets during their employment.

To ensure fairness, the employer must compensate the former employee during the non-compete period with at least 75% of the salary the employee would have earned had they remained employed. Non-compete agreements must also explicitly define the scope of prohibited activities, geographical area, and duration. The maximum permissible duration is one year from the employment termination rate.

Intellectual property rights

In Albania, the ownership and rights to intellectual property generated by employees during employment are governed by the Labour Code and the Law on Authors’ Rights.

Intellectual property created by employees typically falls into categories like inventions, industrial designs, models, and literary or artistic works. 

Inventions made by an employee during employment or inventions where the employee has played a significant role belong to the employer. This applies only when the invention is created within the scope of the employee’s duties and in a way that benefits the employer’s business.

Employers may extend their intellectual property rights through written agreements, specifically if the invention falls outside of the employee’s contractual duties. If the employer retains the ownership of an invention created by the employee, the employee is entitled to fair compensation. 

When it comes to industrial drawings, models, computer programmes, and creative works, the employer is entitled to use them to the extent necessary to fulfil the objectives of the employment contract.

Employee data privacy

In Albania, data protection for employees outlines the employer’s responsibility to handle sensitive employee information securely. Employers may only collect data relevant to the professional abilities of employees or necessary for fulfilling employment contracts. The collected information must be safeguarded to prevent unauthorised access, misuse, or disclosure. 

Employers are additionally bound by law to maintain the confidentiality of any employee data obtained, both during and after the employment period. While this obligation remains unlimited in time, the maintained employee data after ending the employment can only be retained for six months, after which it must be deleted unless the employee provides written consent for future retention.

Remote working policy

Remote work and teleworking have become prominent modes of employment in Albania, especially with the rise of information technology and the global shift towards flexible working arrangements. These working models are legally recognised, with specific conditions regulating work performed from home or remote locations.

While employees working remotely enjoy the same legal protections as in-office employees, there are certain provisions of the Labour Code that don’t apply to them. This includes regulations on working and rest hours and compensation for work difficulties. Employers must also ensure that remote employees enjoy parity in working conditions, have the necessary technological equipment, and create opportunities for social integration.

Responsibilities within a remote work arrangement

In recent years, the shift towards flexible work arrangements has highlighted the need for structured legal frameworks that govern remote work. Albania’s Labour Code recognises both work-from-home and teleworking arrangements, with legal frameworks that apply to these non-traditional work settings. These laws protect the rights of employees and clarify the obligations of employers.

Provided that they are documented in a written contract, both work-from-home and teleworking contracts are legally binding in Albania. However, both parties have defined responsibilities to ensure a structured, fair, and compliant working environment. 

Employers are required to supply, install, and maintain essential technological tools unless the employee opts to use personal equipment. Employers must also take measures to prevent social isolation by organising opportunities for employee interaction.

Employees must work from the location specified in the contract and use the agreed equipment. Any deviations, such as performing different tasks or changing work locations, require employer consent.

What are the advantages of hiring employees from Albania vs other countries?

Hiring employees from Albania offers international companies many strategic advantages, through cost-efficiency, access to educated and skilled workforce, and operational flexibility.

Compared to those in the Western European countries, Albanian wages are significantly lower, which allows businesses to reduce labour costs without compromising on quality. 

Albania is also the home to young and educated workforce with strong proficiency in languages like English and Italian, as well as specialised skills in technology, business, and engineering. In addition to this, Albania’s growing freelance and remote work scene provides a large pool of digitally skilled talent, which is pefect for businesses who want to hire remote workers.

Lastly, the Albanian government further encourages foreign companies to hire locally by simplifying the employment process, making Albania a very attractive choice for global talent acquisition.

Why use Native Teams for hiring in Albania?

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• No paperwork: We will handle all the necessary paperwork for you.
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• 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.