How to hire and pay employees in Romania

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Romania Facts and Stats

Currency

Romanian Leu (RON)

Languages

Romanian

Population

19 million

Payroll frequency

Monthly

Hiring

Grow your team in Romania

Emerald can hire and payroll your workers, quickly and compliantly with their ready to go entity. Make growing your team simple with Emerald as a global partner.

Pros & Cons of hiring in Romania

Hiring employees in Romania comes with distinct benefits and challenges. On the plus side, Romania has a well-educated and growing labour force, particularly strong in IT, engineering, and customer service, due to its emphasis on higher education and competitive technical training programs. The cost of labour is relatively low compared to Western European countries, providing businesses with a cost-effective solution for accessing skilled talent. Additionally, Romania’s strategic location at the crossroads of Eastern and Western Europe offers potential advantages for regional operations and market access.

However, there are some drawbacks to consider. The complexity of Romania’s labour laws and administrative processes can be cumbersome, potentially leading to increased compliance costs and management overhead. While the workforce is skilled, there can be challenges related to regional disparities in skill levels and infrastructure. Furthermore, while Romania’s business environment is improving, navigating local bureaucracy and adapting to evolving regulations can be a hurdle for companies entering the market. Overall, while Romania presents opportunities for cost-effective and skilled labour, understanding and managing the regulatory and operational challenges is crucial for successful employment practices.

Why Romania is good for remote workers

Employers should consider hiring remotely in Romania due to its rapidly growing pool of tech talent and competitive labour costs. Romania is renowned for its strong emphasis on STEM education and technical expertise, particularly in software development, IT services, and engineering, making it an attractive destination for high-quality remote work. The country’s well-developed digital infrastructure supports seamless remote collaboration, and its strategic location within Eastern Europe offers convenient time zone overlap with both Western European and North American markets. Additionally, Romania’s relatively lower cost of living translates to cost-effective solutions for employers seeking skilled professionals without the high expenses associated with Western Europe. By hiring remotely in Romania, companies can tap into this talented workforce while benefiting from favourable economic conditions and efficient remote working capabilities.

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Employment

Probation

Probationary periods are common, with a maximum duration of 90 days, which can be extended to 120 days for managerial positions.

Emerald Technology can onboard employees in Romania within 48 hours.

Insurance
01.

Health Insurance

In Romania, a public healthcare system aims to provide accessible medical care to all residents, primarily funded by employees, employers and the government. This means that all legal residents and citizens receive health insurance coverage, and this is overseen by the National Health Insurance House. Health insurance contributions are automatically deducted from salaries as it is mandatory for all employed individuals to be covered. Employers contribute 5.2% of each employee’s gross salary and employees contribute 10% of their gross salary toward health insurance.

02.

Social Security

Social security contributions in Romania fund various benefits such as pensions, family support, healthcare and unemployment insurance which means that these contributions are mandatory and governed by the National Institute of Social Insurance. Employers contribute approximately 17.05% of each employee’s gross salary and employees contribute approximately 20% of their gross salary.

Leave Policy
01.

Maternity Leave

Female employees are entitled to 126 days of maternity leave, which can be taken as 63 days before the expected due date and 63 days after childbirth. This leave can be extended by up to 2 weeks in case of multiple births or if the child has health issues. The employee will be paid 85% of their regular salary, by national health insurance system.

02.

Paternity Leave

 10 days, within the first 8 weeks of the child’s birth.

03.

Parental Leave (if applicable)

Either parent can take parental leave from the end of maternity leave until their child is two years old.

04.

Sickness Leave

Those who have contributed to the social security system for 12 months are entitled to up to 183 days of sickness leave. This will be paid by the employer at 75% of the usual salary for the first 5 days, then covered by social security.

Onboarding

Onboarding

As the legal employer, Emerald Technology requires the following employee documents to ensure complete compliance:

Emerald Technology can onboard employees in Romania within 48 hours.
Termination

Resignation and Dismissal

When an employer dismisses an employee it must be with just cause and they must give them notice. The notice period starts from the day after the employer notifies the employee of the termination. Notice must be given in accordance with the following schedule at a minimum:

For employee dismissal, the mandatory notice period is at least 20 working days, regardless of the contract type.

Employees can resign by providing written notice, with a notice period not exceeding 20 business days for non-management roles and 45 business days for management positions.

Severance

If an employee is made redundant, they are entitled to a payment based on years of continuous service.

Severance pay is not required by law but can be introduced via the employment contract or collective agreements.

Time off

Statutory Time off

20 days for a full-time worker.

Public Holidays

New Year’s Day
New Year Holiday
Orthodox Easter Sunday
Orthodox Easter Monday
Labour Day
Children’s Day
Assumption of Mary
National Day of Romania
Christmas Day
Second Day of Christmas

Emerald Technology can onboard employees in Romania within 48 hours.
Salary / Taxes

Work, Pay and Taxes

01.

Minimum Wage

RON3,700.00 per month in 2024

02.

Working Hours

Typically, 40 hours per week (5 days of 8 hours)

03.

Overtime

Tasks carried out outside of regular working hours are classified as overtime and require the employee’s consent. Overtime is restricted to a maximum of 8 hours per week and is usually compensated with additional time off within 60 days. Alternatively, it may be paid at a rate of 175%. Work performed on public holidays can be compensated either with extra time off or at 200% the standard pay rate.

04.

Salary Payments

Monthly

05.

Bonus or 14th month salary (if applicable)

In Romania, the concept of a 13th or 14th month salary is not mandated by law but may be included in employment contracts or company policies.

06.

Taxes

Up to 16,000 RON 0% No tax

16,001 – 38,000 RON 10% 10% on income exceeding 16,000 RON

Over 38,000 RON 10% on first 22,000 RON + 16% on amount exceeding 38,000 RON

10% on income up to 38,000 RON, 16% on income above 38,000 RON

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