Greek Employment Contracts
A successful business largely depends on its employees. By creating working contracts that include the right terms and benefits there will be no misconception and the perfect work-life balance can be created. At Bradford Jacobs, this is our aim, and we support companies in over a hundred countries with creating compliant and balanced labor contracts. Our team in Greece keeps track of the Greek laws and regulations on a daily basis to be duly aware of updates that can be implemented in working contracts. By using our PEO and EOR service we can provide compliant labor contracts for employees in Greece including local benefits.
To support your plans in Greece we made this guide including the basics of employment contracts in Greece. After reading this guide you will know everything about social security in Greece, notice periods, and average working hours.
How Do Companies Hire Greek Employees?
If a foreign company is looking to hire resident employees as part of their global expansion into Greece, they must comply with recruitment regulations such a tax, social security contributions and local employment laws, as well collaborate with or adhere to any collective bargaining, trade unions or work council agreements. In Greece, employment contracts do not have to be present to the employees in writing to be valid. Except for specific contracts, it is not obligatory for an employment contract to be in writing. However, under the Labor Code, employers must inform employees of benefits, working hours, salaries, working hours and work schedule in writing.
Labor law in Greece is based on the principle of employee protection. The employment relationship and its terms are hierarchically determined by the Constitution, international treaties, the local labor law, collective employment agreements, employment rules and business practices, with the individual contract being last in the order. According to the protection principle of Greece’s labor law, if opposing issues are regulated simultaneously by different hierarchical structures, the regulation most favorable for the employee will prevail. Thus, it is important for the employer to know the existing labor laws and employee entitlements, as well as collaborate with the appropriate local employment organizations.
Collective employment agreements are determined between employers’ and employees’ trade unions. These agreements regulate employment terms that comprise the minimum working conditions for the applicable employees. An agreement is applicable when both employer and employee are members of the contracting trade unions. There are different types of collective employment agreements:
- Sectoral-collective agreements – cover employees working in the same sector.
- Occupational-level agreements – cover employees engaging in the same occupation.
- Enterprise-level agreements – cover all employees working for a single company.
- National General Collective Agreements – shape the minimum terms of employment for employees nationwide regarding non-pay terms.
Employment Contracts in Greece
In Greece, written employment contracts are not common practice. However, under the Labor Code (Presidential Decree 156/1994), employers must notify their employers of the material terms of the contract in writing. This applies to both indefinite and fixed term contracts, as well as working relationships of a duration exceeding 1 month. This information must be provided for the employee no later than 2 months after they started work, in one of the following ways (chosen by the employer):
- In an employment contract
- In another document
The details that must be included in one of these documents are as follows:
- Details of the contracting parties (employer and employee)
- Place at which work is to be performed, the registered office of the company or the home address of the employer
- The employee’s post and grade or employment category, and their work duties
- The date of the commencement of the employment contract and its duration (if fixed term)
- Paid leave entitlements (duration, time, manner)
- Compensation payable and notice requirements in the event of contract termination
- All forms of earnings to which the employee is entitled to
- Employee’s daily and weekly working hours
- Applicable collective agreement which establishes the employee’s minimum terms of wage and employment.
Failure to provide the employee with one of these documents results in a fine but does not invalidate the employment contract.
Other employment forms
Besides employment contracts, there are other types of employment forms:
Work contracts (contractors): This contract type is mainly for contractors, which states the contractor’s tasks and payment terms (when part of the work or all the work is delivered). These types of contracts cease when the work is done.
Contracts for the provision of independent services (freelancers): This contract type is used when the work or the person under the service is not subject to the employer’s management/control.
Association contracts: This contract type is used when a joint grant is pursued with joint contributions.
Representation contracts: This contract type is used the employee acts on the general instructions of the employer, without working under the employer’s supervision or being bound to the regular working hours.
Termination of Contract
Employers are free to dissolve an employment contract of indefinite duration at any time, by giving notice of termination in writing, as well as paying the appropriate compensation. However, employers have the option to dismiss an employee without notice (known as an extraordinary termination), or they may do so with notice, in which case termination compensation is reduced by 50%. This, however, differs from fixed-term and work employment contracts, as with these contracts, the employer must justify the employee’s termination. Regarding the employee’s termination rights, they are entitled to terminate a contract of indefinite duration and depart voluntarily from their employment but must give the employer due notice of the termination within the legally prescribed time limits.
Once the notice has been given from either the employer or employee, the employer must submit an electronic notification of the employment termination through the ERGANI information system, within 4 days of delivering/receiving the notice. Failure to submit the electronic notification to ERGANI shall incur penalties. If the employee does not sign the dismissal document, a notice is served to them by a bailiff.