Moldova PEO Services

Moldova ranks well in terms of ease-of-doing business and its main industries include food procession, agricultural machinery, appliances, and more. Moldova also has a growing IT sector, and its workforce in this space is continuously growing.

Employment Information

In Moldova, the normal working week is 40 hours on average.

Moldovan law limits overtime to 120 hours per year, although this amount may be increased to 240 hours by a collective bargaining agreement. The first two hours of overtime are paid at 150% of the employee’s standard hourly rate, and any additional hours of overtime are paid at 200% of the employee’s standard hourly rate.

Employees that work on holidays or on their day off are either paid at double their usual rate. Alternatively, they may choose to receive their normal rate of pay and an unpaid day off (on a day on which they would normally work).

Leaves / Public Holidays

Employees are generally entitled to 28 calendar days of paid annual leave, excluding public holidays. The vacation may be taken in parts, but one part must be of at least 14 continuous calendar days.

Female employees are generally entitled to maternity leaves of 70 calendar days before the birth and 56 calendar days after. Employees are also generally eligible for a partially paid holiday until the child reaches the age of three. The duration of the holiday depends on the employee’s seniority, position, and insurance. Both maternity leave and the partially paid holiday are paid for out of the Moldovan social insurance fund.

Mothers with two or more children under the age of 14 are entitled to 4 additional days of paid annual leave.

Mothers with two or more children under the age of 14, and single parents with at least one child under the age of 14, are eligible for an unpaid vacation of 14 calendar days which can be used in conjunction with the annual paid holiday or separately; this does not have to be taken all at once.  Unpaid holidays can be taken from when child is three years old until the child is six. The duration of the leave is dependent on the position of the employee and her seniority.

Fathers, grandparents, or other relatives who care for children are eligible for a partially paid holiday to take care of a child under the age of three.

Employees are eligible for paid sick leave if they present a medical certificate. State social insurance pays for sick leave.

There are a variety of public holidays in Moldova, these include:

• New Year’s Day
• Orthodox Christmas
• International Women’s Day
• Orthodox Easter Monday
• Easter of the Blajini
• Labor Day
• Victory and Commemoration Day
• Children’s Day
• Independence Day
• National Language Day
• Roman Catholic Christmas
• Cultural Information

Visas

Moldova established the visa regime for the representatives of certain countries. Citizens of most states (EU member states, CIS member states, USA, Canada, and other country nationals), do not need visas for entry on the territory of the Republic of Moldova for a period of stay up to 90 days. This is counted cumulatively within the prior term of 180 calendar days.

Foreigners who are nationals of some nations may enter Moldova without a visa if they are holders of residence permits or valid visas (excluding transit visas), issued by one of the Member States of the European Union or one of the States Parties to the Schengen Agreement.

Generally, any foreign individual should obtain a temporary residence permit for work purposes, even if the person is an employee seconded for a limited period of time to the Republic of Moldova. It is prohibited to pay a salary to a foreign person without first being granted a residence permit. As an exception, no temporary residence permit for work purposes is needed, when the specialist is detached to Moldova for a term of up to 90 days during the period of 1 year, from the first entry in Moldova.

Businesses looking to hire local employees in Moldova or relocate foreign workers from their current country can utilise a Moldova PEO partner to facilitate this. Here at Procorre Global, we support businesses with this process.

Taxation

Corporate and Individuals Taxes

• Income tax is 12% for legal entities and 12% for individuals; however, in the case of legal entities this tax may be lower.
• VAT: the standard rate is 20%, but for HORECA it is 10%, for pharmaceuticals and agri-food it is 8%, for natural gases 6%, and for international transportation 0%.
• Excises vary between 0.5% and 5%, depending on the tariff position of a given product.
• Customs Duty may be as high as 30%, although there are plenty of exemptions and preferences.
• Road Duty, depends on the engine’s capacity or the vehicle’s weight.
• Wealth Tax, includes the land and real estate payments - up to 50% of profit.
• Dividends amount to 6%.

Taxation of Labour in Moldova

• Income Tax – 12% contributed by the employee
• Health Insurance Contribution – 9% contributed by the employee
• Social Security Contribution – 24% contributed by the employer

Cultural Information

The Republic of Moldova has a multicultural population. Romanian speakers make up the largest group of citizens (more than 75%). Russian language is also widely used. Generations born after the country gained independence are fluent in other languages too, especially English, Italian, Spanish.

The predominant religion in Moldova is Christianity, 90% of the population nominally being Eastern Orthodox.

Impacts from COVID-19

Government policy in response to the COVID-19 pandemic ensured that the Moldovan labour market wasn’t affected too badly by it. The Government offered subsidies for enterprises that were forced to suspend operations because of lockdowns.

As a result of the pandemic, growing opportunities for remote work and hybrid working patterns have emerged, and many look set to continue.