Payroll and Benefits Guide - Andorra

Andorra
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Currency

Euro (EUR)
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Capital

Andorra la Vella
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Employer Taxes

15.50%
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Date Format

dd/mm/yyyy
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Fiscal Year

1 Jan – 31 Dec

Fun Facts

The country has a population of around 77,000 people, making it one of the least populous countries in the world.

Andorra has two co-princes who serve as heads of state—the President of France and the Bishop of Urgell in Catalonia, Spain.

Andorra has a unique political system called a diarchy, where the co-princes share equal powers with a local government.

Andorra is known as a tax haven, with a low-tax economy that attracts many tourists and shoppers.

The country has no airport or train station. Visitors typically arrive by road from Spain or France.

Andorra has a strong skiing and winter sports industry.

Andora

Contributions

Employee Payroll Tax

Contribution TypeRate
Social Security6.50%

Employer Payroll Tax

Contribution TypeRate
Social Security15.50%

Payroll

Payroll Cycle

The payroll cycle in Andorra is monthly.

13th Salary

In Andorra, it is not obligatory for employers to provide a 13th-month salary payment, and bonuses are given at the employer’s discretion, typically based on performance.

Work Hours and Week

In Andorra, the regular working hours consist of 40 hours per week and 8 hours per day, accompanied by a thirty-minute break for every six hours of work.

Overtime

Any work exceeding the established standard working hours per week in Andorra qualifies as overtime and is subject to regulation through employment contracts or collective agreements.

For the initial four hours of overtime worked each week, the compensation should be at least 25 percent higher than the regular hourly wage. Subsequently, for the next four hours of overtime, the payment should be no less than 50 percent higher than the regular hourly wage.

Andora

Leave

Paid Time Off

Once employees have been employed for a minimum of twelve months, they are entitled to a minimum of 30 paid vacation days, as outlined in the Labor Agreement. Before completing one year of service, the annual leave is adjusted proportionately based on the duration of employment.

Sick Days

Employees have the right to take sick leave for a period of 12 months, which can be extended in six-month intervals for a maximum duration of three years. When an individual receives a medical certificate from a doctor or dentist, prescribing their need for medical leave, it is mandatory for the insured person to submit the initial medical certificate to their employer within 48 hours.

During the sick leave period, employees receive a portion of their salary from the social security system, CASS. The exact amount paid by CASS depends on the duration of the sick leave taken by the employee.

Maternity Leave

The maternity leave benefit in Andorra consists of 16 weeks of paid leave. However, if there are medical complications during the pregnancy or multiple births, the maternity leave entitlement is extended to 18 weeks.

Paternity Leave

In the first six months following the birth of a child, fathers are eligible to take up to 14 days of paternity leave with full pay.

Termination

Termination Process

In Andorra, employment laws safeguard employees by placing limitations on the reasons for which an employer can terminate their employment. The specific guidelines and regulations regarding dismissals can be found in the Labor Law. Employers in Andorra have the authority to terminate employees either with or without cause.

Notice Period

The notice period for employees in Andorra depends on their length of service. After completing six months of service, the notice period is calculated as one day of notice per month worked, up to a maximum of 90 days.

Severance Pay

The employment contract specifies the severance payments that are owed, but in general, employers in Andorra are required to provide financial compensation to employees who have completed a minimum of six months of service.

Probation Period

Probation Period

The duration of the probationary period in Andorra varies depending on the nature of the position and is stated in the employment agreement. Generally, probation periods range from three to six months.

Immigration

VISA

Work visas in Andorra grant individuals the right to stay in the country for a duration of up to 12 months. These visas can be extended twice by submitting multiple visa applications. It’s important to note that work visas are valid only for the specific professional activity outlined in the individual’s work contract.

VAT

The standard rate of VAT in Andorra is 4.50%.