G-P provides employer of record services for customers that want to hire employees and run payroll without first establishing a branch office or subsidiary in Bosnia. Your candidate is hired via G-P’ Bosnia PEO in accordance with local labor laws and can be onboarded in days instead of the months it typically takes. The individual is assigned to work on your team, working on your company’s behalf exactly as if he or she were your employee to fulfill your in-country requirements.
Our solution enables customers to run payroll in Bosnia while HR services, tax, and compliance management matters are lifted from their shoulders onto ours. As a Global PEO expert, we manage employment contract best practices, statutory and market norm benefits, and employee expenses, as well as severance and termination if required. We also keep you apprised of changes to local employment laws in Bosnia.
Your new employee is productive sooner, has a better hiring experience and is 100% dedicated to your team. You’ll have peace of mind knowing you have a team of dedicated employment experts assisting with every hire. G-P allows you to harness the talent of the brightest people in more than 185 countries around the world, quickly and painlessly.
Bosnia and Herzegovina is a Southeastern European country on the Balkan Peninsula, bordering Croatia, Serbia, Montenegro, and the Adriatic Sea. It has a population of over 3 million and is an increasingly popular tourist destination. It is important to note that Bosnia and Herzegovina (BiH) comprises two entities: the Federation of Bosnia and Herzegovina (FBiH) and Republika Srpska (RS). Each entity has its own government, president, parliament, police force, and authorities that oversee labor and employment issues.
When negotiating terms of an employment contract and offer letter with an employee in Bosnia, it may be useful to keep the following in mind:
Employment Contracts in Bosnia and Herzegovina
It is legally required to put a written employment contract in place in Bosnia, in the local language, which spells out the terms of the employee’s compensation, benefits, and termination requirements. An offer letter and employment contract in Bosnia should always state the salary and any compensation amounts in convertible marks rather than a foreign currency.
Working Hours in Bosnia and Herzegovina
The work week is generally 40 hours.
Holidays in Bosnia and Herzegovina
Bosnia celebrates 4 national holidays, but regions celebrate their own holidays in addition to these.
- Orthodox Christmas Day
- Independence Day
- Labor Day
- Ramadan Bajram
Vacation Days in Bosnia and Herzegovina
Employees are generally entitled to 20 days of paid annual leave, and in FBiH, no more than 30 days of leave.
Bosnia and Herzegovina Sick Leave
Employees are eligible for compensation for at least 5 sick days per year.
Maternity/Paternity Leave in Bosnia and Herzegovina
Female employees are generally entitled to one year of maternity leave.
In FBiH, the employee must take at least 42 days of leave, and in RS she must take at least 60 days of leave. In FBiH, following her leave, she may work half-time until her children are 2 years old. The father may work half-time instead, if the mother returns to full time work.
In RS, the employee is also entitled to an additional 6 months of leave if she has twins or for every child from her third child on.
In FBiH, the employee is entitled to compensation under law, and employers often make up the difference to her full salary.
In RS, the employee is entitled to compensation of the equivalent of her average salary over the prior 12 months or the time she worked before her maternity leave if it is less than 12 months.
Health Insurance in Bosnia and Herzegovina
In FBiH, the employer contributes 4% of the employee’s salary to health insurance. The employee contributes 12. 5%.
In RS, solely the employee contributes to health insurance, at a rate of 12%.
Termination/Severance in Bosnia and Herzegovina
Employees under FBiH jurisdiction are generally entitled to at least 14 days notice and no more than three months notice.
Those under RS jurisdiction are generally entitled to at least 30 days of notice. There is no maximum period.
For violations of the employment agreement or grave violations of work duties no notice is needed in either jurisdiction.
In FBiH, an employee who has worked for at least 2 years is generally entitled to a severance payment, the amount of which is usually fixed in the collective agreement. However, it may not be less than 1/3rd of the employee’s average monthly salary for each year of employment or more than 6 average salaries.
Paying Taxes in Bosnia and Herzegovina
In FBiH, the employer contributes 6% of the employee’s salary to social security. The employee contributes 17%. Employers and employees must also contribute 0.5% and 1.5% to unemployment insurance, respectively.
In RS, the employee contribute 18.5%. for social security, 0.6% for unemployment insurance, and 1.7% for child protection. There are no employer social security contributions in RS.
This information is provided as generally accepted information and is not intended as advisory services.
Establishing a branch office or subsidiary in Bosnia to engage a small team is time-consuming, expensive and complex. Bosnian labor law has strong worker protections, requiring great attention to detail and an understanding of local best practices. G-P makes it painless and easy to expand into Bosnia. We can help you hire your candidate of choice, handle HR matters and payroll, and ensure that you’re in compliance with local laws, without the burden of setting up a foreign branch office or subsidiary. Our Bosnia PEO and Employer of Record solution provides you peace of mind so that you can focus on running your company.
If you would like to discuss how G-P can provide a seamless employee leasing or PEO solution for hiring employees in Bosnia, please contact us.