Employ
RecruitEmployer of Record in Andorra
Andorra’s labor law includes CASS social security, mandatory severance, and specific hiring regulations, and an Andorran EOR handles all compliance for you with no local entity needed.
Andorra
Hiring in Andorra at a glance
Currency
Euro (EUR)
Language
Catalan
Average Salary
~$2,420/mo
Payroll Cycle
Monthly
Employer Cost
15.5%
Paid Leave
30 days
Probation
Up to 3 months
Notice Period
Up to 90 days
13th Month
Not required
Work Hours
40 hrs/wk
A Spanish fintech startup needed a compliance analyst in Andorra la Vella. Someone who understood EU-adjacent financial regulation, spoke fluent Catalan and Spanish, and could handle cross-border reporting between Barcelona and the Principality. They found the right candidate through a referral network within three days. But when their legal team looked into how to actually hire her, they hit a wall. Andorra isn’t part of the EU, so standard European hiring frameworks don’t apply. Setting up a local entity — a societat limitada — would’ve meant weeks of paperwork with the Registre de Societats, a minimum share capital deposit, and ongoing obligations they weren’t ready for.
That’s where an employer of record in Andorra steps in. Instead of incorporating locally, you use a partner that already has a legal entity in the Principality. They employ your chosen candidate under Andorran law, run payroll in euros, handle CASS social security filings, and keep everything compliant with Andorran labor law. You manage the work. They manage the paperwork.
This guide covers exactly how an employer of record works in Andorra: what it costs, which employment laws apply, how benefits and termination work, and when an EOR makes more sense than your own entity.
Employer of Record in Andorra: How to Hire Without Setting Up a Company
Most companies that want to hire in Andorra face a fundamental question. Spend weeks (and thousands of euros) incorporating a societat limitada, or find a faster path? An employer of record gives you that faster path.
An EOR in Andorra is the legal employer for your team members on paper. In practice, you run the show. You pick who to hire, define the role, and manage day-to-day work. The EOR handles everything that touches Andorran labor law: employment contracts, payroll, tax withholding, CASS contributions, and statutory benefits.
This matters more than people expect. Andorra’s Llei 35/2008 de relacions laborals governs all employment relationships in the Principality. Foreign companies can’t simply pay someone as a freelancer and call it a day. Andorra’s Servei d’Inspecció de Treball actively audits employment relationships, and misclassification can trigger back-dated CASS contributions plus penalties.
Talk to Remote People about compliant EOR services in Andorra →
Hire in Andorra
One of Europe’s smallest nations and a unique low-tax jurisdiction, with CASS social security contributions, the Andorran Labour Relations Act, and full statutory benefits compliance.
We handle employment contracts, payroll, social contributions, and full Andorra compliance.
No local entity needed. Your team can start in days.
Employer of Record vs. Setting Up a Local Entity in Andorra
| Factor | EOR | Local Entity |
|---|---|---|
| Setup Time | 1–5 business days | 4–8 weeks |
| Setup Cost | $0 | €5,000–€12,000 |
| Minimum Capital | None | €3,000 |
| Ongoing Admin | Handled by EOR | Monthly accounting, annual filings, registered office |
| Compliance Risk | EOR manages | You manage |
| Best For | 1–15 employees | 15+ employees or licensed activities |
| Exit Flexibility | End when contracts end | Liquidation process required |
When an EOR Makes Sense
An EOR is the right choice when you’re hiring 1–15 people in Andorra, need to start fast, or want to access Andorran talent without the foreign investment authorization process and entity formation. Andorra’s incorporation process is notably more complex than in larger EU countries, involving government authorization that can take months.
When a Local Entity Makes More Sense
If you’re planning to hire more than 15 employees in Andorra, or if your business requires specific local licensing (financial services, hospitality), your own entity starts to become more cost-effective. Companies in crypto, e-commerce, and professional services are increasingly setting up Andorran entities for the 10% corporate tax rate.
Remote People can help you evaluate when the transition from EOR to entity makes financial sense.
What an Employer of Record Actually Does in Andorra
So what does an EOR handle on a day-to-day basis?
They draft locally compliant employment contracts in Catalan (Andorra’s sole official language), making sure every mandatory clause is covered: job description, compensation, probation terms, working schedule, and notice period provisions under the Llei de relacions laborals.
On payroll, salaries are calculated and paid monthly in euros. The EOR deducts the correct employee CASS contributions (6.5% of gross salary) and files everything with the Caixa Andorrana de Seguretat Social.
Andorra requires employer CASS contributions of 15.5% on top of gross salary. Here’s the breakdown:
Employer Tax Contributions
| Contribution | Rate |
|---|---|
| General Branch (health, sickness, maternity) | 7.0% |
| Retirement Branch (pension) | 8.5% |
| Total Employer Cost | 15.5% |
Employee Tax Contributions
| Contribution | Rate |
|---|---|
| General Branch (health, sickness, maternity) | 3.0% |
| Retirement Branch (pension) | 3.5% |
| Total Employee Cost | 6.5% |
Income tax is another piece they manage. Andorra uses a progressive personal income tax system (IRPF, or Impost sobre la Renda de les Persones Físiques), but the rates are remarkably low by European standards. More on that below.
Then there’s benefits administration. From annual leave (30 calendar days) to sick leave, maternity coverage, and public holidays, the EOR makes sure your employees receive everything the Llei de relacions laborals entitles them to.
And compliance monitoring. Andorran regulations do change. The minimum wage, for example, rose to €1,525.33 per month effective January 2026 — a 5.4% increase under Decree 8/2026. A reliable EOR stays ahead of these shifts.
Employment and Labor Laws in Andorra
Employment Contracts
Every employment relationship in Andorra must be formalized with a written contract. If you’re planning to hire employees in Andorra, there’s no informal arrangement that holds up legally. Contracts can be indefinite (the default and most common) or fixed-term, but fixed-term contracts are only permitted for genuinely temporary needs: seasonal work, specific projects, or covering an absent employee.
If a fixed-term contract is extended beyond its original term without clear justification, it converts to indefinite automatically. Andorra’s labor inspectorate pays close attention to this, especially with foreign employers.
Working Hours and Overtime
The standard workweek is 40 hours, typically Monday through Friday. Daily maximum is 8 hours. The legal annual cap is 1,800 hours of ordinary working time. Employees get a 30-minute break after every 6 consecutive hours.
Overtime kicks in beyond 40 hours per week and must be compensated at minimum 150% of the regular hourly rate, or offset with equivalent time off. Monthly overtime is capped at 60 hours, annual at 426 hours. Night work (10 PM – 6 AM) carries additional protections and premium pay.
Salary Benchmarks
Average monthly salaries in Andorra range from €2,500 to €3,000, though skilled professionals in finance, tech, and tourism management can earn €4,000–€6,000. Andorra’s cost of living is lower than Barcelona or Paris, but higher than many Southern European cities.
The minimum wage is €1,525.33 per month (€8.80/hour) as of January 2026, set by Decree 8/2026. That’s a 5.4% increase from the 2025 rate of €1,447.33. The average wage used as the CASS reference base is €2,560.99/month.
Income Tax
Andorra’s personal income tax (IRPF) is one of the most attractive in Europe:
| Annual Taxable Income (€) | Rate |
|---|---|
| €0 – €24,000 | 0% |
| €24,001 – €40,000 | 5% |
| Above €40,000 | 10% |
A maximum rate of 10%. Someone earning €70,000 per year pays roughly €3,800 in income tax — an effective rate of about 5.4%. For context, that same salary in France would attract roughly €12,000 in income tax. The EOR handles all IRPF withholding and monthly filing.
Savings income is taxed separately: the first €3,000 is exempt, and anything above is taxed at 10%. Dividends from locally incorporated companies are taxed at 0% for Andorran residents.
Probation Periods
Probation in Andorra depends on the salary level. For wages below three times the minimum wage, probation typically lasts up to 3 months (as specified in the contract). For wages at or above three times the minimum wage (€4,575.99/month in 2026), probation caps at 3 months. For wages at or above five times the minimum wage (€7,626.65/month), it can extend to 6 months. During probation, either side can end the relationship with 24 hours’ notice.
What it Costs to Use an Employer of Record in Andorra
EOR pricing in Andorra typically follows one of two models: a flat monthly fee per employee, or a percentage of the employee’s salary.
Most EOR providers charge between $400 and $700 per employee per month as a flat fee. This covers payroll processing, CASS filings, compliance monitoring, and benefits administration.
Some providers charge 15–25% of gross monthly salary instead. For an employee earning €3,000/month, that’s roughly €450–€750/month.
On top of the service fee, you cover the employee’s gross salary plus the mandatory 15.5% employer CASS contributions:
| Cost Component | Monthly Amount (€) | USD Equivalent |
|---|---|---|
| Gross Salary | 3,000 | ~$3,250 |
| Employer CASS Contributions (15.5%) | 465 | ~$505 |
| EOR Service Fee | — | $400–$700 |
| Total Employer Cost | — | ~$4,155–$4,455 |
Compare that to setting up a local entity, where you’re looking at €5,000–€12,000 in incorporation costs, a minimum share capital of €3,000, ongoing accounting fees, and a registered office in Andorra. For small teams, the EOR route is faster, cheaper, and far less administratively heavy.
Employee Benefits and Leaves in Anorra
| Leave Type | Entitlement | Paid By |
|---|---|---|
| Annual Leave | 30 calendar days | Employer |
| Public Holidays | 14 national + up to 4 local | Employer |
| Sick Leave | 3–9 days (by tenure), then CASS | Employer / CASS |
| Maternity Leave | 16 weeks (18 for complications) | Employer / CASS |
| Paternity Leave | 14 days | Employer / CASS |
| Parental Leave | 1–4 months (extendable to 2 years) | Unpaid |
| Marriage Leave | 3 days | Employer |
| Bereavement Leave | 2–4 days (by relationship) | Employer |
Annual Leave
Every employee in Andorra is entitled to 30 calendar days of paid annual leave per year after completing one year of service. During the first year, leave accrues at 2.5 days per month. At least one block of 14 consecutive days is standard practice, and timing is subject to employer approval.
Public Holidays
Andorra observes 14 national public holidays per year. Each parish may also designate up to 4 additional local holidays, so actual non-working days can reach 18 depending on location.
| Holiday | Date | Type |
|---|---|---|
| New Year’s Day | 1 January | National |
| Epiphany | 6 January | National |
| Carnival | 12 February | National |
| Constitution Day | 14 March | National |
| Good Friday | 3 April | National |
| Easter Monday | 6 April | National |
| Labour Day | 1 May | National |
| Whit Monday | 25 May | National |
| Assumption of Mary | 15 August | National |
| National Day (Mare de Déu de Meritxell) | 8 September | National |
| All Saints’ Day | 1 November | National |
| Immaculate Conception | 8 December | National |
| Christmas Day | 25 December | National |
| St. Stephen’s Day | 26 December | National |
Sick Leave
Sick leave in Andorra is tiered by tenure: 3 days in the first year of employment, 6 days in the second year, and 9 days from the third year onward. Employees must present a medical certificate to CASS within 48 hours. After the employer-paid period, CASS covers sick pay at approximately 66% of the reference wage.
Maternity and Paternity Leave
Maternity leave spans 16 weeks at full pay, extending to 18 weeks for multiple births or medical complications. A minimum of 6 weeks must be taken after delivery. Payment is calculated at 100% of the mother’s average daily earnings, funded through CASS.
Fathers receive 14 days of paid paternity leave, which must be taken within six months of the child’s birth.
Parental Leave
Beyond maternity and paternity, Andorran law provides unpaid parental leave of 1 to 4 months, extendable in equal periods up to a maximum of 2 years. This applies to both parents.
13th Month Salary
There’s no statutory 13th month salary in Andorra. Some employers offer year-end bonuses or performance-based pay, particularly in finance and tourism, but it’s voluntary.
Termination Rules: How to End an Employment Relationship in Andorra
Notice Periods
Notice periods in Andorra are based on length of service. After the first six months, the requirement is one day of notice for each month worked, up to a maximum of 90 calendar days. During probation, 24 hours’ notice is sufficient from either side.
Severance Pay
Andorra distinguishes between justified and unjustified termination. For unjustified dismissal (employer terminates without valid cause), the employee is entitled to severance — typically one month’s salary per year of service, up to a maximum set by Andorran courts.
For justified dismissal (serious misconduct, repeated underperformance with documented warnings), no severance is required. But the employer must follow proper disciplinary procedures. Skipping the process makes the termination automatically unjustified, triggering severance regardless of the underlying reason.
How the EOR Handles Termination
For economic redundancy, the requirements go further. The employer needs genuine business justification and must follow the procedural requirements in the Llei de relacions laborals. An EOR manages this entire process.
How to Choose the Right Employer of Record for Andorra
Local Expertise
Andorra isn’t part of the EU, which means employment regulations, immigration, and social security operate independently. Choose a provider with genuine Andorran expertise — not one that treats it as an afterthought of their Spanish or French operations. The country has unique filing deadlines, Catalan language requirements for contracts, and a relationship with the EU that creates regulatory nuances.
CASS Compliance
CASS registration and monthly contributions must be handled precisely. Late or incorrect filings trigger penalties. Your EOR should have a proven track record of on-time submissions and clean compliance history.
Immigration Support
If you’re hiring foreign nationals who need to relocate, Andorra has its own work and residence permit system — separate from any EU framework. All foreign nationals, including EU citizens, need an autorització d’immigració. Processing times vary by nationality and role.
Transparent Pricing
Ask for a complete breakdown: service fee, CASS contributions, and any charges for onboarding, offboarding, or contract amendments. Andorra’s relatively high cost of living means salaries run higher than many EOR markets, so understanding total cost matters.
Why Andorra is Worth Hiring In?
Andorra sits between France and Spain in the Pyrenees, and it occupies a unique position in more ways than geography. With a maximum income tax rate of 10%, employer social contributions of just 15.5%, and no capital gains tax for residents, it’s one of the most tax-efficient locations in Europe for both employers and employees.
The population of around 80,000 means the talent pool is compact, but highly international. Over 50% of residents are foreign nationals — predominantly Spanish, Portuguese, and French. Professionals here tend to be multilingual and experienced in cross-border work.
The time zone (CET, GMT+1) overlaps perfectly with Western European business hours. Digital infrastructure is solid — Andorra has invested heavily in becoming a tech-friendly jurisdiction. Co-working spaces and startup incubators have grown steadily in Andorra la Vella and Escaldes-Engordany over the past five years.
For fintech, consulting, digital services, and tourism management roles, Andorra offers a compelling package: European-adjacent talent at significantly lower total employment costs than France, Spain, or the UK.
Getting Started with an Employer of Record in Andorra
Hiring your first employee in Andorra through an EOR is more straightforward than most people expect.
You start by choosing an EOR partner and sharing the candidate details, role description, and compensation package. The EOR drafts a compliant employment contract in Catalan and handles all statutory requirements.
Once the contract is signed, your new team member gets registered with CASS for social security and healthcare, and set up on monthly payroll. That process typically takes 1–5 business days. From there, the EOR runs payroll, files IRPF, manages employee benefits, and monitors regulatory changes. You manage the work.
Expand into Andorra with Remote People’s Employer of Record
Remote People handles hiring in Andorra from start to finish. We manage the legal employment, payroll in euros, CASS social security filings, IRPF withholding, and full compliance with the Llei de relacions laborals. You focus on building your team.
No local entity needed. No foreign investment authorization. No weeks of paperwork. Your new hire can be working within days.
Start hiring in Andorra in as little as 48 hours. Whether you need a specialist in Andorra la Vella or a team across the Principality, Remote People handles the complexity.
Frequently Asked Questions
An employer of record (EOR) in Andorra is a local entity that legally employs workers on behalf of a foreign company. The EOR handles employment contracts, payroll, IRPF tax withholding, CASS social security contributions, and compliance with Andorra’s Llei de relacions laborals. You manage the employee’s daily work and responsibilities.
EOR services in Andorra typically cost between $400 and $700 per employee per month as a flat fee, or 15–25% of gross salary. On top of the service fee, you cover the employee’s salary and the mandatory 15.5% employer CASS contributions. Total employer costs are often lower than comparable hires in France, Spain, or Switzerland.
No. The EOR already has one. You skip the foreign investment authorization, government approvals, minimum capital requirements (€3,000), and ongoing admin. Your employees are hired through the EOR’s existing Andorran entity.
Employer CASS contributions total 15.5% of gross salary — split between the general branch (7.0%) and retirement branch (8.5%). There’s no mandatory 13th month salary. The employee contributes an additional 6.5%.
Most providers complete the process in 1–5 business days. The main steps are signing the employment contract, registering with CASS, and setting up payroll. Remote People can have your team member onboarded in as little as 48 hours.
Yes, but very low. Andorra’s IRPF has three brackets: 0% up to €24,000, 5% from €24,001 to €40,000, and 10% above €40,000. The maximum effective rate stays well below 10% for most earners. There’s no capital gains tax for residents on most transactions.
Yes. Andorra isn’t part of the EU, so all foreign nationals (including EU citizens) need an Andorran work and residence permit (autorització d’immigració). Permits are tied to a specific employer and role. Your EOR can guide you through the application with the Servei d’Immigració.
Andorra’s primary employment legislation is the Llei 35/2008 de relacions laborals, covering contracts, working hours, wages, leave, termination, and workplace safety. The CASS system governs social security. Sector-specific collective agreements may apply in hospitality and construction.
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