Definitive Guide to Hiring in Monaco

Hiring in Monaco

Hiring employees compliantly in Monaco means doing it yourself or using an Employer of Record like Global Expansion. You should be careful using independent contractor agreements in Monaco so that you don’t run afoul of employment laws. To hire an employee compliantly and offer them mandatory benefits and compliant agreements, you can:

(a) Establish your own new legal entity, banking, accounting and payroll service in Monaco; or

(b) use an Employer of Record like Global Expansion who can handle all of the details for you.

Labor Laws in Monaco

Employment laws in Monaco are uniquely suited to the country’s way of life, and crucial to understand if you want to employ local talent in this country. Get the details on Monaco employment laws and Monaco policies here.

Employee Probation Period

Annual Leave in Monaco

• The employee has the right to 2.5 working days of paid leave per month of actual work completed.
• The period of the leave must not exceed 30 days.
• Part-time employees have the right to the same number of days as full-time employees.
• The number of days of paid leave increases according to length of service in the same company. Employees have the right to:
  • Two additional working days after 20 years of service in the same company
  • Four additional working days after 25 years of service in the same company
  • Six additional working days after 30 years of service in the same company
• The total number of days accumulated in this way must not exceed 36 days.

Holidays in Monaco

Monaco celebrates twelve national public holidays as well as additional public holidays that vary by state:

Maternity Leave Monaco

• Women are allowed 16 weeks’ maternity leave in Monaco, for the third child, maternity leave is 26 weeks. 
• An allowance is paid during maternity off-time. 
• A pregnant employee is not obliged to reveal her pregnancy until the time she wishes to take maternity leave. 
• Notification can be by made verbally or by letter.

Paternity Leave Monaco

• You can take paternity leave of:
  • 12 consecutive calendar days for a single birth
  • 19 calendar days for multiple births
  • 19 calendar days if there are already two or more other children in the household

• You can take the whole or part of this leave.

Sick Leave in Monaco

• Days taken as sick leave do not qualify as paid leave, unless there are contractual provisions to the contrary.  
• Days of absence for sick leave must not be deducted from the annual leave.

Working Hours in Monaco

Overtime in Monaco

• If there is a request from the employer, an employee in Monaco can render overtime work which should not exceed 48 hours per week. 
• Workers should be paid 25% for the first eight hours and 50% for any subsequent hours of overtime.

Termination of Employment in Monaco

• Employees are entitled to a notice period and severance pay upon termination of employment if they meet certain conditions
• Notice period is as follows: -
  • 1 month of notice period if length of service is more than 6 months but less than 2 years with the same employer
  • 2 months of notice period if length of service is more than 2 years with the same employer
• To qualify for a statutory redundancy payment, you must have been continuously employed for at least two years.
• The amount of severance pay is as follows:-
  • 1/4 of the monthly salary for each year of service for the first 10 years
  • 1/3 of the monthly salary for each year of service for the first 11 years

Notice Period in Monaco

• Notice period is as follows: -
  • 1 month of notice period if length of service is more than 6 months but less than 2 years with the same employer
  • 2 months of notice period if length of service is more than 2 years with the same employer

Severance in Monaco

• To qualify for a statutory redundancy payment, you must have been continuously employed for at least two years.
• The amount of severance pay is as follows:-
• 1/4 of the monthly salary for each year of service for the first 10 years
• 1/3 of the monthly salary for each year of service for the first 11 years

Monaco Salary and Wages

13th/14th Month Salary in Monaco

• No
• There is no evidence that there is a statutory requirement to pay the 13th or 14th month salary.
• The labour code refers to governmental employees.

• Individuals’ social security taxes are withheld monthly by employers. 
• Monegasque social security tax contributions are due on compensation, including bonuses and benefits in kind, earned from performing an activity in Monaco and paid in Monaco. 
• However, this rule may be modified by a social security totalization agreement. 
• The total charge for 2018 (the 2019 rates will be available in October 2019) is approximately 10% to 14% (depending on retirement fund contributions and level of remuneration) of gross salary for employees and 28% to 40% for employers. 
• Some of the contributions are levied on wages up to certain ceilings. 
• The following are the rates of these contributions and the amounts of the ceilings for 2018 (the 2019 rates and ceilings will be available in October 2019): 
  • Sickness contribution and family allocation: employee share of 0% and employer share of 15.05% (monthly ceiling of EUR8,600) 
  • Basic state pension contribution: employee share of 6.55% and employer share of 8.03% (monthly ceiling of EUR4,896) 
  • Unemployment contribution: employee share of 2.40% and employer share of 4.05% (monthly ceiling of EUR13,508)

Immigration Monaco

• All foreign nationals - that is, non-Monegasques - are required to obtain a work permit (Permit de travail) before they take up any job in Monaco. 
• They also need to get a new permit if they change position or employer.
• It is the responsibility of the employer to help their employee obtain a work permit. 
• Recruitment must be agreed by the Service de l'Emploi. 
• When a job vacancy comes available the employer must contact the Service de l'Emploi, which then has four days to come up with an employee from Monaco or the surrounding area. 
• Under Monegasque law local people with the same qualifications have priority. 
• If a candidate within these criteria cannot be found, the employer may then propose its own candidate.
• To obtain a work permit the employee must submit their contract of employment stamped by the employment service, along with proof of residence and personal identification to the Service de l'Emploi. 
• If the employee lives in Monaco, a valid Monegasque residence permit is required. 
• If resident in France, a French identity card or valid residence permit that authorises him to work is necessary.
• The Employee also has to have an annual medical examination at the Office de la Médecine du Travail 

Value Added Tax (VAT) in Monaco

• For the purposes of VAT Monaco is part of the European Union.
• The Principality adopts the French system for collection.
• The local name for VAT in Monaco is “Taxe sur la valeur ajoutée” (TVA).
• There are basically 4 VAT rates in Monaco:
  • Standard VAT rate is 20%
  • Reduced VAT rates are 10% and 5.5%

Mandatory Benefits in Monaco

• These are mandatory benefits as postulated by law
• These include probationary period, annual leave, public holidays, maternity leave, paternity leave, overtime pay, severance pay and 13^th month pay.
• Statutory benefits also include social security benefits

Payroll Accrual in Monaco

Country Accruals Additional Information

Description

Gainfully employed persons, including self-employed persons earning at least US$10,000 a year or with at least one employee (small businesses).Voluntary coverage for self-employed persons earning less than US$10,000 a year.

Exclusions

• Casual employees who work less than one week in any calendar month and family labor.
• Special systems (individual retirement plans) for some types of government employees.

Payroll Accruals Additional Information

Accrued Benefits in Monaco

Why use Global Expansion to hire in Monaco

Establishing a branch office or subsidiary in Monaco can be time-consuming, expensive and complex. With such a robust labor market in place, one must pay great attention to detail when structuring employment because Monaco labor laws are complex.

The company also has a responsibility to comply with specific employment practices dictated by Monaco law to maintain its good standing as an equal opportunity employer.

Global Expansion makes it easy for you to expand into Monaco. We'll help you hire your candidate of choice, handle HR matters and payroll, and ensure that you comply with local laws without the burden of setting up a foreign branch office or subsidiary. In addition, you'll have complete control and direction over your employees.

We enable you to stay in control of everything. Our Monaco Global Professional Employer Organization (PEO) and Employer of Record (EOR) solution provides you with peace of mind to focus on running your company and the security to enter new markets.