Holidays in Cyprus. How many days are you entitled to and who pays for them?

Holidays in Cyprus is a statutory right for private and public sector employees, including those on apprenticeships. An employee who has worked 48 weeks in a year is entitled to at least four weeks of paid leave – 20 days for a five-day week or 24 days for a six-day week.

For the period of leave, the employee receives remuneration directly from the employer or from Central Holiday FundThe system used depends, among other things, on whether the employer is exempt from paying contributions to the Fund.

Cyprus holiday: 20 or 24 days

The basic amount of paid leave is four weeks per year. This means:

• 20 business days with a five-day work week,
• 24 business days with a six-day working week.

If an employee worked less than 48 weeks in the previous year, the leave entitlement is reduced proportionally.

The period of employment taken into account when determining the right to leave also includes the period of certain justified absences, including those related to illness, accident, maternity leave, parental leave or leave due to force majeure.

If the employment contract, collective agreement or other applicable arrangements provide for a more favourable leave entitlement for the employee, the employee retains this more favourable entitlement.

Which days are not deducted from vacation?

Not every employee absence can be treated as an use of their annual leave.

According to the rules described by the Cypriot authorities, annual leave does not include holidays stipulated by law, contract, or custom, as well as specified periods of incapacity for work, maternity leave, or parental leave. Official materials also confirm that leave cannot be simply replaced by payment of money, except in the event of termination of employment.

Who pays for vacation?

There are two basic solutions in Cyprus.

The employer may pay the employee's normal salary during leave if it applies an appropriate leave system and has obtained an exemption from the obligation to pay contributions to the Central Leave Fund.

In other cases, the employer pays contributions to Central Holiday Fund, and the funds for the leave period are paid to the employee from the Fund.

The minimum contribution is 8%

In the case of the basic leave amount – 20 days for a five-day working week or 24 days for a six-day working week – the employer’s contribution to the Central Holiday Fund amounts to 8% of the employee's salary.

The greater the length of leave you are entitled to, the higher the contribution rate.

For example, for a five-day working week it is:

• 20 days of vacation – 8%
• 25 days – 10%
• 30 days – 12%
• 35 days – 14%
• 40 days – 16%

With a six-day work week:

• 24 days – 8%
• 30 days – 10%
• 36 days – 12%
• 42 days – 14%
• 48 days – 16%

Intermediate rates apply between these values, as shown in the Social Insurance Services tables. For even longer leave periods, the contribution percentage increases accordingly.

What is included in the contribution base?

The basis is not just the basic salary.

Among other things, basic salary, indexation allowance, commissions, 13th and 14th month salary, overtime, shift allowances and holiday pay may be taken into account.

Contributions are calculated on gross wages, before taxes and other deductions, subject to applicable limits.

When does the Central Holiday Fund pay?

To receive a payment from the Central Holiday Fund, an employee should generally use at least nine consecutive days of leaveThe official website of the Ministry of Labor confirms this requirement.

If the employee was employed for less than 48 weeks in the previous year, the minimum uninterrupted leave required is four days.

According to information provided by Social Insurance Services, a person who worked less than 13 weeks in the previous year does not receive holiday pay from the Central Holiday Fund.

Vacation can be carried over to the next year

Unused leave can be accumulated over a period of time. up to two years, if the employee and employer so agree.

This may result from an employment contract, a collective agreement or company practice.

If holiday pay is paid by the Central Holiday Fund, benefits for both years may be paid when accumulating holiday pay is used.

How to receive money from the Fund?

An employee using the Central Holiday Fund must submit an appropriate application and provide the bank account into which the funds are to be transferred.

Forms are available through Social Insurance Services, including at district social insurance offices and citizen service centers. Official information on submitting applications is also published by the Ministry of Labor.

After the first submission, there is no need to re-submit your bank details unless your account number changes.

What about leave after leaving work?

If employment is terminated, the employee does not lose any leave entitlement.

An employer who pays holiday pay himself and is exempt from contributions to the Fund should allow the employee to use the remaining holiday leave or settle the days due in accordance with the regulations.

Official guidelines emphasize that replacing paid leave with monetary compensation is permissible precisely in the event of termination of the employment relationship.

Employer Inspections and Liability

Social Insurance Services may audit employers and their records relating to employment, wages and contributions paid.

Failure to comply with employment law obligations can result in sanctions. Official information from the Ministry of Labor indicates that in certain cases, violations may result in a fine, imprisonment of up to one year, or both.

In the event of an individual dispute, the provisions of the employment contract or collective agreement may also be relevant, especially if they guarantee the employee conditions that are more favourable than the statutory minimum.

Source: Social Insurance Services