Moldova PEO & Employer of Record

WeHG provides an International PEO and global Employer of Record service in Moldova to companies willing to enter the Moldavian market or hire local/expat employees in Moldova.

Conventional approach requires establishing a subsidiary in Moldova.  However our solution allows you to start the operations in Moldova within days hence save time and money.  WeHG would hire candidates on your behalf while you maintain full operational control of their work. So legally they would be our employees, on our local payroll, 100% compliant but will work on your behalf. 

Moldova fast facts

Population, million: 4,033,963
Land area: 33,846 km²
Capital: Chișinău
Local currency: Lei (MDL)

GDP per capita:$ 3200.00
GDP in currency:$ 11.24 billion

Moldova is located in Europe, but its not part of the European Union. It is one of the poorest countries in the continent, fact which explains its high levels of emigration. Currently, it is estimated that 25% of Moldovans work abroad.

There are however some foreign companies that prefer to set their base in Moldova. Low operational costs are appealing to companies that can outsource their workforce entirely or partially. That is highly common in the IT industry. Moldova has a quite fast internet, even faster than countries like Italy or France, according to Akamai.

The main sources of employment law are:

• Code no. 154/2003 (Labour Code).
• Labour Inspection Law no. 140/2001.
• Law no. 186/2008 regarding labour protection and health.
• National Collective Labour Agreement no. 2/2004.

Hiring, Negotiating and Doing Business in Moldova

Necessity of written employment contract

In Moldova, the contract should be in the local language and in writing format. The contract should state the salary and any compensation amounts inlocal currency.

Different forms of engagement: employment, contracting, work with private entrepreneur

Fixed or indefinite term contract to meet Moldova’s employment compliance laws. Fixed-term contracts cannot exceed five years. All contracts should be in local language, and we recommend outlining everything from benefits to termination terms.

Moldova Employment Contract

Types of employment agreements

Fixed–term contracts can be concluded for no more than 5 years.

Moldova working hours

The working week is 40 hours, with a five – or eight–hour working day.

Overtime

An employer can order overtime work in case that is related to national defense or emergencies. Normally, at employer’s request, employees can perform overtime work up to 120 hours during the calendar year. In exceptional cases, this limit can be extended to 240 hours with the agreement of both parties (Article 104). Employers must keep a record of worked performed outside normal working hours. The overtime work is paid at 1.5 the amount of the regular hourly rate for the first two hours of overtime work and at 2 times the regular rate for the subsequent hours.

Vacation leave in Moldova

An employee is entitled to 28 days of paid leave.

Moldova Maternity Leave

Maternity leave is paid from the social insurance fund and the duration of the maternity leave is 70 calendar days before delivery and 56 days after.

Female workers are entitled to an additional 4 days of paid leave if there are two or more children under the age of 14.

Female workers are also entitled to an additional 14 days of unpaid leave if they have 2 or more children, this also applies to single parents with one or more children.

Moldavian Severance Laws

Employees can terminate the contract with 14 calendar days‘ written notice.

Dismissal of employees is permitted for good reason and can be negotiated with the union.

Employees are usually entitled to one month’s notice of termination or two months in advance in the event of a liquidation or dismissal. Employees are also entitled to one day a week to look for a new job.

Employees are generally eligible for severance pay equal to the weekly wage for each year worked, with a minimum wage of one month if they leave for economic reasons.

Employees who are terminated for good reason are usually entitled to two weeks’ wages.

Moldova Tax

Income from employment, including benefits in kind and from professional or entrepreneurial activity  12%

In general, employers make social security contributions of 23% of gross salary to the Social Security Fund.
Employees must pay 6% of their gross salary, subject to a cap, to the Social Security Fund.
Both employers and employees must contribute 4.5% of wages to health insurance.

Health Insurance Benefits in Moldova

The mandatory health insurance contribution, computed as a percentage of wages and other remuneration is established at 4.5% for each payer category (employers and employees). The legislation also provides for an annual fixed amount of health insurance contribution paid by other categories of taxpayers in an amount approved for each year (e.g. MDL 4,056 applicable in 2020).

Starting 1 January 2021, health insurance contributions will be fully borne by the employee through a 9% single contribution.

For foreign citizens and stateless people employed under labour agreements in Moldova, health insurance contributions are computed similarly as for Moldovan citizens. In the absence of a local labour agreement, foreign citizens can opt for optional health insurance from a private provider.

Moldovan citizens who are unemployed and not insured by the government have the liability to pay fixed health insurance contributions if their presence in Moldova exceeds 183 calendar days.

Additional Benefits in Moldova

Typically, employees are entitled to vacation pay at least equal to the salary they would receive during the vacation. The salary must be paid to the employee at least three days before the vacation.

General market practice benefits/additional allowances

Annual and performance-based bonuses are common.

Moldova Holidays

Public holidays

• New Year’s Day
• Orthodox Christmas Day
• 2nd Day of Christmas (Eastern)
• International Women’s Day
• Orthodox Easter
• Orthodox Easter Monday
• Radonitsa
• Labour Day
• Victory Day
• Victory in Europe Day
• Children’s Day
• Independence Day of Republic of Moldova
• Limba noastră
• Christmas Day

Why Choose WeHireGlobally

WeHG takes care of all the onboarding hurdles, payroll, compensation and benefits, tax filing, and termination of employment. Our Employer of Record solution allows you to manage your overseas teams efficiently while minimizing cost and risk.