How to hire and pay EMPLOYEES IN

Croatia

Looking to hire remote workers to join your team? No matter where in the world your employees work, Oyster makes it easy for you to hire, pay, and take care of employees hassle and worry-free.
Sign Up for a Free Account

Before hiring

EMPLOYEES IN
Croatia

Before hiring employees in Croatia, there are a few important things you’ll need to know. Firstly, it’s a legal obligation in Croatia to include details of any sick or vacation leave on a payslip. It’s important for employers to know that all time off must be recorded and approved.

As an employer in Croatia, there are also various tax free allowances available to be paid entirely at the employer's discretion. Employers should know what these are and how much is typically paid out for each.

We know this might sound overwhelming—but it doesn’t have to be. A solution like Oyster eliminates the barriers for you. With Oyster, you can automate compliance across 180+ countries, easily managing HR and payroll—all in one, easy-to-use platform. 

Get an overview of what you need to know when hiring in Croatia below.

At a Glance

CURRENCY

HRK

OFFICIAL LANGUAGE

CROATIAN

PAYROLL FREQUENCY

MONTHLY

PUBLIC HOLIDAYS

14

(based on region;
see here
)

EMPLOYER TAXES

16.5%

of gross salary

13th / 14th SALARY

N/A

Good to know

  • Under Croatian law, an Employer of Record is able to engage in an indefinite employment contract but the assignment of the person to your company must be limited to a period of no more than three years. After three years of continuous working, the employee must take a break of at least two months before he can be registered to work for you again.
  • Employees must be registered for mandatory health insurance with the Croatian Health Insurance Fund (HZZO). This entitles them to sick pay or income replacement benefit, and sick leave as needed.
  • There are various tax free allowances available to be paid entirely at the employer's discretion. These include a 5,000 kuna bonus allowance, 3,000 Easter/Christmas Bonus and a 5,000 kuna tax free food allowance.

Employment in

Croatia

Working hours and overtime

In Croatia, full-time employment cannot be more than 40 hours per week. An employee can work up to 48 hours in a week, but eight of these will be overtime.

Employees are entitled to a minimum of 12 hours break between two consecutive work days and at least 24 consecutive hours once a week

It is a legal obligation in Croatia to include details of any leave on a payslip, so all time off must be recorded and approved.

Employment contracts
Probationary period

A probationary period in Croatia cannot exceed six months. During the agreed probationary period, the termination period must be at least seven days.

Pensions
Notice period

In Croatia, the notice period is defined by law and varies depending on the length of continuous employment, and potentially with age. It goes as follows:

  • Two weeks for more than one year employment
  • One a half months months for more than two years employment
  • Two months for more than five years employment
  • Two and a half months for more than 10 years employment
  • Three months for more than 20 years employment
Non-compete agreements

Non-compete clauses can be included in the employment agreement provided it has been mutually agreed, and the employee is earning above the national average wage in Croatia. A non-compete cannot last more than two years and will only be valid if it aims to protect legitimate business interests and does not disproportionately limit the ex-employee's work opportunities elsewhere.

Employment cost calculator

Holidays

01 Jan

New Year's Day

05 Aug

Victory and Homeland Thanksgiving Day

06 Jan

Epiphany

15 Aug

Assumption Day

05 Apr

Easter Monday

08 Oct

Independence Day

01 May

Labour Day

01 Nov

All Saints' Day

30 May

Statehood Day

18 Nov

Remembrance Day

03 Jun

Corpus Christi

25 Dec

Christmas Day

22 Jun

Anti-Fascist Resistance Day

26 Dec

St Stephen's Day

01 Jan

New Year's Day

06 Jan

Epiphany

05 Apr

Easter Monday

01 May

Labour Day

30 May

Statehood Day

03 Jun

Corpus Christi

22 Jun

Anti-Fascist Resistance Day

05 Aug

Victory and Homeland Thanksgiving Day

15 Aug

Assumption Day

08 Oct

Independence Day

01 Nov

All Saints' Day

18 Nov

Remembrance Day

25 Dec

Christmas Day

Employer tax

In Croatia, an employer’s social contributions total 16.5%. Health Insurance is paid at 16.5% of an employee’s gross salary, and is not capped. 

Individual tax

Employees in Croatia pay between 24% and 36% in taxes depending on their income bracket. 

Employees also pay social security contributions of 20%. These are pension contributions (15% goes to Pillar I and 5% goes to Pillar II) Both contributions are capped at 52,452 HRK monthly.

In Croatia, employees also pay a municipality surtax of up to 18%.

Termination of employment

All terminations must be notified to the employee in writing and there can be regular or exceptional terminations. The types of terminations are as follows:

Regular termination (with agreed notice):

  1. Notice for business reasons: This can include redundancy of an employee’s role due to economic, technical, or organisational reasons. The employer must first check that they cannot engage the employee in another role and is not allowed to hire someone in the same role for at least six months.
  1. Notice for personal reasons: This means the employee is unable to fulfil their contractual duties due to a permanent characteristic or capabilities. Again, the employer must check that they can't engage the employee in another suitable role first.
  1. Notice for employee's misconduct: This refers to breach of contract. The employee should get a written warning with the possibility of termination in case of continuing breach of contract—unless circumstances mean it is reasonable not to give this warning. 
  1. Notice due to failing probationary period: This type of termination means that an employee does not perform to expectation during the probationary period. 

Exceptional terminations can be executed with only 15 days' notice from learning about an issue where there is a serious breach in employment relationship or other highly important fact.

Start hiring employees in

Croatia

Setting up a business entity everywhere you want to hire a new employee isn’t scalable—it takes too long and the legal fees are high. At the same time, understanding and adhering to the local labor laws and employee expectations can be complex and time consuming. And it’s hard to find reliable information on up-to-date employment information for all the countries where you’re considering hiring. Not to mention tracking down invoices and managing employee contracts over email and spreadsheets—that gets messy fast. 

We can’t afford to take risks when it comes to compliance—we need to make sure we follow the local guidelines, especially when it comes to taxes and legalities. 

With Oyster, you can manage HR and payroll, and automate compliance across 180+ countries—all in one, easy-to-use platform.

Hire a team of A-players,
wherever they work in the world.

Get started today!