Romania is a growing economy with strong GDP growth and some of the lowest tax rates in the EU. The population is just over 19 million people, with strong electric machinery, agriculture, and mining industries. Maintaining compliance with local laws and regulations, and managing the language barrier can be challenging. The corporate tax rate is 16%, but rates can vary depending on the size of the company.

Payroll and Tax Considerations in Romania:

  • Employment contracts must be in writing
  • Minimum wage is applicable to all employees – full-time, part-time, or temporary. The current minimum wage is EUR 466.23 per month
  • Overtime is compensated with paid time off instead of wages within the next 30 days after overtime has been done
  • If employees work on a holiday, they must receive time off instead of wages or be paid at 100% regular wages
  • There are no provisions for severance pay
  • Personal income is taxed at a flat rate of 10%. Income from dividends is taxed at 5% and income from interest is taxed at 10%

HR and Statutory Requirements

  • All employees have the right to paid annual leave. The minimum annual leave is 20 days
  • Employees working in dangerous conditions receive an extra 3 days of leave
  • The length of leave is determined by collective agreements or employment contracts
  • Employees are eligible for paid sick leave for a maximum of 183 days in a 12-month period. The employer must pay the first 5 days, then the Single National Health Insurance Fund pays the remaining leave
  • Female employees receive 126 days of maternity leave, 63 days before and 63 days after delivery. They must have worked at least 1 month in the last 12 months to be eligible
  • Fathers receive 5 days of paternity leave if they have been insured with the state social security system. The 5 days must be used within 8 weeks of the child’s birth

Holidays in Romania

  • January 1 – New Year’s Day
  • January 2 – Day after New Year’s Day
  • January 24 – Unification Day
  • April 22 – Orthodox Good Friday
  • April 24 – Orthodox Easter Day
  • April 25 – Orthodox Easter Monday
  • May 1 – Labor Day / May Day
  • June 1 – Children’s Day
  • June 12 – Orthodox Pentecost
  • June 13 – Orthodox Pentecost Monday
  • August 15 – St. Mary’s Day
  • November 30 – St. Andrew’s Day
  • December 1 – National holiday
  • December 25 – Christmas Day
  • December 26 – Second Day of Christmas

To simplify your payroll in Romania, Blue Marble has created an easy-to-use payroll platform with customized reporting to view payroll in real-time across all countries and currencies. We provide a dedicated US-based team and direct access to in-country experts to help with any questions. Simplify your business operations and payroll in Romania to ensure compliance. To learn more, click here