bosnia-and-herzegovina

Bosnia and Herzegovina

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Minimum wage

What are the minimum wage requirements?

Minimum Wage Updated in Republika Srpska, Bosnia and Herzegovina from 01 January 2022 – January 11, 2022. The minimum wage in Republika Srpska, Bosnia and Herzegovina has been revised with effect from 01 January. The minimum wage has been increased from BAM 540.00 to BAM 590.00 per month.

Contributions & Taxes

In FBiH, the employer contributes 6% of the employee’s salary to social security. The employee contributes 17%. Employers and employees must also contribute 0.5% and 1.5% to unemployment insurance, respectively.

In RS, the employee contributes 18.5%. for social security, 0.6% for unemployment insurance, and 1.7% for child protection. There are no employer social security contributions in RS.

The tax base is the net income. After all deductions such as social insurance contributions, personal income tax, and other taxes are made, the employee is entitled to a net monthly salary which in average amounts to 428,00 EUR.

Employer

The complexity of the state organization in Bosnia and Herzegovina also applies to the tax system. As part of the harmonization process, indirect taxation at state level was introduced in 2006. However, direct taxes are still accounted for and paid at entity level (Federation of Bosnia and Herzegovina (F BiH), Republic of Srpska (RS) and Brcko District of Bosnia and Herzegovina (BD)).

Corporate

Corporate Tax Rate in Bosnia and Herzegovina remained unchanged at 10 percent in 2021 from 10 percent in 2020. source: Indirect Taxation Authority of Bosnia and Herzegovina.

Employee

The  Federation of Bosnia and Herzegovina (FBiH) and the Republika Srpska (RS) both have a 10% flat rate. Exceptions may apply. 

Income Tax

Personal income tax (PIT) of 10%, in addition to social security contributions, has to be calculated and withheld by an employer with the salary payment. There are no additional payroll taxes due in the Federation of Bosnia and Herzegovina.

Payroll

Is there 13th salary in Bosnia and Herzegovina?

There is no requirement for the 13th salary payment in Bosnia and Herzegovina.

Labor Rules

Typical working hours are a maximum of 40 hours per week. 

In FBiH, an employee can work a maximum of 8 hours overtime per week. In RS, an employee can work a maximum of 4 overtime hours per day, 10 hours per week, and 180 hours per year. Overtime pay is subject to a specific agreement with the employer. Overtime laws in Bosnia and Herzegovina are complex and can depend on the specific circumstances and the employee. We are happy to discuss in more detail for a specific context.

Probation period rules

The maximum length of a probationary period is six months in the FBH and BD, and three months in the RS. In the BD, the probationary period may be renewed once, for an additional six months, for a total probationary period of 12 months.

Notice Period 

An employee must give seven days of notice when quitting. The employer and employee may agree on a different notice period, but it may not be longer than one month if the employee is giving notice to the employer, or three months if the employer is terminating the employee.

Severance Period

If a worker who concludes an employment contract for an unlimited duration and this contract is terminated by the employer after a minimum of two years of continuous work (except if the contract is terminated due to breach of employment obligations or non-performance of employment obligations by the worker), then the worker is entitled to severance pay to an amount depending on his years of continuous employment with that employer. Severance payment is determined based on the collective agreement, employment rulebook or employment contract, but it cannot be an amount lower than one-third of the monthly average salary paid to the worker within the last three months prior to termination of the employment contract for every year of service with this employer. The severance payment may not exceed six average monthly salaries paid to the worker in the last three months before the termination of the employment contract.

Leave and Benefits

Leave and Benefits rules

Public holidays

In accordance with the labor laws in FBiH and RS, the minimum annual leave is 20  days, however, no longer than 30 working days, during which the employees are entitled to full salary compensation based on the laws, collective agreements, and the rule books.

  • New Year’s Day
  • New Year’s Holiday
  • Orthodox Christmas Eve
  • Orthodox Christmas Day
  • Republic Day
  • Orthodox New Year
  • Independence Day
  • Catholic Easter Sunday
  • Catholic Easter Monday
  • Orthodox Good Friday
  • Labor Day
  • Labor Day Holiday
  • Orthodox Easter Sunday
  • Orthodox Easter Monday
  • Victory Day
  • Ramadan Bajram
  • St Vitus Day
  • Kurban Bajram
  • All Saints’ Day
  • Dayton Agreement Day
  • Statehood Day
  • Catholic Christmas Day

Sick leave

Under the labor laws in FBiH, employees are entitled to an additional paid leave of absence for five working days for RS, and seven working days for FBiH, annually in cases of serious illness and death of family members. Employees may refuse to work if required health and safety measures are not met by the employer at the workplace. Employers must register all employees for health and health/disability Insurance and enable the full protection of employees against any accidents at work. 

When an employee is temporarily unable to work, employers cannot terminate the employment contract with an employee who suffered an injury at work or was sick. The employer must allow employees to return to their same job they worked in before the occurrence of these conditions.

Maternity leave & Paternity leave

Women are entitled to maternity leave for a period of one year without interruption during the pregnancy, childbirth, and after the birth for the care of the baby. Under the labor law of RS, in the case of a birth with twins, or the birth of a third child, women are entitled to 18 months of maternity leave. 

The woman may start the maternity leave at her request within 28 days before the due date and on recommendation of a competent doctor. She may start to work at her request before the expiration of her maternity leave, but not before 60 days after the childbirth under the labor law of RS, and 42 days under the labor law of FBiH. 

She is entitled to a 60-minute break during working hours for child feeding and other care. During maternity leave, women are entitled to full salary compensation, the net amount of which could be reverted to the employer from social service with prompt and correct application supported by proposed documents.

A male worker may be granted paternity leave only if his wife is entitled to a full maternity allowance (14 weeks). 

Parental Leave

Federation of Bosnia and Herzegovina/Republic of Srpska: 365 days (one year). A woman may start maternity leave 28 days prior to the expected date of birth of the child. District of Brcko: 12 consecutive months. The leave may start 28 days before the presumed date of confinement.

Other leave (marriage, bereavement, exam leave)

An employee shall be entitled to paid absence from work of up to seven working days in one calendar year – paid leave in the case: marriage, wife’s confinement, serious disease or death of a family or household member. 

Family member, in terms of paragraph 1 of this article, shall include: spouses or extramarital partners, a child (from marriage, extramarital, adopted child, adopted child of a spouse, or parentless child taken for support), father, mother, adoptive father, adoptive mother, foster parent, grandfather and grandmother (by father and mother), brothers and sisters. 

An employee shall also be entitled to paid absence in other cases and over periods determined in the rule of the canton, collective agreement or rulebook.

Insurance

Health Security & Private Insurance

Payroll taxes and the general budget are used to fund Bosnia’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

Native Teams can support you in finding a Visa in Bosnia and Herzegovina. Contact us and we will send a comparison of Visa packages and prices*