Hiring employees in Croatia requires more than just finding the right person for the job. Whether you are a foreign investor opening a business in Zagreb, a local entrepreneur in Split, or an international company establishing operations in Dubrovnik, you need to navigate Croatia’s labor laws carefully. From contracts to payroll to compliance obligations, every step matters to ensure your company avoids penalties and builds a strong foundation for long-term success.

This guide explains the essentials of hiring employees in Croatia: the types of contracts available, working hours, payroll rules, compliance obligations, and the most common mistakes employers make.

The cornerstone of any employment relationship in Croatia is the employment contract. By law, employment contracts must be concluded in writing and delivered to the employee before work begins.

• Indefinite Contracts: These are the default type of contract in Croatia. Unless there is a justified reason for a temporary arrangement, contracts should be open-ended.

• Fixed-Term Contracts: These can only be used for specific reasons, such as covering a temporarily absent worker, fulfilling a defined project, or work tied to a particular event. Successive fixed-term contracts cannot exceed three years in total, except in limited circumstances. Each fixed-term contract must specify the reason for its use.

• Probation Period: Employers can include a probation period of up to six months. If an employee is absent during probation due to illness or leave, the probation may be extended, but never beyond six months. Termination during probation requires at least seven days’ notice.

Croatian labor law sets strict boundaries around working hours to protect employees’ health and safety.

• Full-Time Hours: Standard full-time employment is 40 hours per week.

• Overtime: Employees may work overtime only in exceptional cases. The combined total of regular and overtime hours may not exceed 50 per week. Overtime is capped at 180 hours per year, with some collective agreements allowing up to 250 hours. Overtime must always be paid at a higher rate.

• Rest Periods: Employees are entitled to a minimum of 12 consecutive hours of daily rest, at least one day of weekly rest, and a 30-minute break during the working day when working more than six hours.

Employees in Croatia are entitled to a range of statutory leave benefits:

• Annual Leave: The minimum annual leave entitlement is four weeks of paid leave for full-time employees.

• Public Holidays: Croatia recognizes multiple national public holidays during which employees are entitled to paid leave.

• Other Leave: Employees may take leave for personal or family reasons, such as marriage, childbirth, or illness of a close family member. Parental and maternity leave provisions are also strongly protected under Croatian law.

Employers in Croatia must comply with strict payroll rules and timelines.

• Minimum Wage: As of 2025, the minimum gross monthly wage in Croatia is €970 for full-time work.

• Payment Timing: Wages must be paid no later than the 15th day of the following month.

• Payslips: Employers must provide payslips showing gross salary, allowances, taxes, contributions, and net pay.

• Contributions: Employers are responsible for withholding and paying social security contributions, which cover pensions, health insurance, and unemployment insurance.

Croatia is a member of the European Union, which makes hiring EEA citizens relatively straightforward. They do not need work permits but must register their residence.

Non-EEA citizens, however, require a residence and work permit. Employers are responsible for ensuring these permits are obtained before employment begins. Employment contracts for foreign workers should be prepared in Croatian or as a bilingual version if the employee does not speak Croatian.

Ending employment in Croatia must be handled carefully to remain compliant with the law.

• During Probation: Employers may terminate the contract with a minimum of seven days’ notice.

• Regular Termination: Notice periods depend on the employee’s length of service. The longer the service, the longer the notice.

• Severance: In cases of redundancy or business-related termination, employees may be entitled to severance pay depending on their length of service.

Employers in Croatia must:

• Register employees before work begins with the tax and social security authorities.

• Maintain records of contracts, payslips, working hours, and overtime.

• Adopt internal rules or an HR policy that aligns with the Croatian Labour Act and any applicable collective agreements.

Failure to comply can lead to penalties, inspections, and reputational harm.

Hiring employees in Croatia can feel complex, but once you understand the rules around contracts, working time, payroll, and compliance, the process becomes manageable. Proper planning not only keeps you compliant but also helps you attract and retain talent in a competitive market. Whether you are expanding into Croatia for the first time or scaling your local operations, expert guidance can make the difference between a smooth experience and unnecessary legal exposure.

If you are considering hiring employees in Croatia, our team at Relocation Croatia is here to guide you through every step. From drafting compliant contracts to managing payroll and handling work permits for foreign staff, we provide full support. Book a consultation today to get started.