Salaries are a point of negotiation between the employer and the employee, and shall be paid in accordance with the arrangement determined in the employment contract.


  • Information on wages and the wage terms on which they are based shall be stated in the employment contract.
  • Collective wage agreements provide for minimum wages for a particular job, taking into account age and/or length of service. An employee may negotiate with the employer for terms that are better than the minimum terms that collective wage agreements provide for.
  • Changes to wage rates will be in accordance with the provisions of the collective wage agreement, when new agreements enter into effect.
  • Those who have unpaid wages or other claims, due to the bankruptcy of an employer, may be entitled to payments from the Wage Guarantee Fund with the Directorate of Labour.
  • Wage earners are under obligation to pay taxes and fees on their earnings. Employers are under obligation to deduct these payments and transfer them to the tax authorities and the appropriate funds.

Wage bonuses

  • Collective wage terms generally provide for employers paying their employees a wage bonus once a year (lump sum).
  • Holiday bonuses shall be paid to employees in connection with holiday taking.
  • The December bonus (personal supplement) shall be paid to employees in the month of December.
  • The amount of wage bonuses differs according to contracts, and there may also be a difference in rules on payout dates and other things. Employees must have worked for a particular period of the year to be entitled to these payments, and their value is in proportion to such period.

Pay statements

  • Pay statements shall be issued on each salary payment. Such statements are receipts for the payment of wages and wage-related fees.
  • The pay statement shall show the working hours and the division of wages into wage items and deductions.
  • Wage items on pay statements are all wage payments: day-time wages and wages for work outside normal hours, shift allowances, holiday pay, wage bonuses and more.
  • Deduction items on the pay statement are withholding taxes and other public levies, pension contributions, membership fees and other items, as appropriate.
  • Information on holiday entitlements arising due to curtailments of minimum rest shall be stated on the pay statement.

Salary deductions

Withholding tax

  • Taxes and public levies must be paid on each payout. This payment is a certain proportion of wages that the employer is under obligation to withhold and transfer to the tax authorities and the appropriate funds.
  • In calculating withholding tax, the employee's entitlement to personal allowance, which is stated on the tax card, is taken into account.

Pension payments

  • The minimum contribution of a wage earner to a pension fund is 4% of total wages, and the amount of the deduction shall be stated on the pay slip.
  • The employer shall pay the pension contribution to the pension fund of which the employee is a member, together with the employer's corresponding contribution. The same applies if an employee pays supplementary pension payments, in which case payments shall be made to the fund or the account that the employee selects, together with the corresponding contribution paid by the employer, if so provided in their contract.

Membership fees

  • The employer is under obligation to deduct membership fees from the wages of an employee and pay them to the appropriate union. Fees vary from union to union, although a common rate is 1%. 

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