Greece is often called the cradle of Western civilization, but it has more to offer than its aesthetic beauty and history. The country has made a name for itself in education and workforce development. As of 2021, the country’s literacy rate reached an impressive 99.3%.

Around 46.4% of the labor force holds higher education degrees, with 7% possessing master’s or doctoral qualifications. The Greek workforce is mainly in the services sector, making up 71.4% of employment.

Greece maintains a notably high self-employment rate, with 33% of its workforce operating independently. On the economic front, real GDP growth is projected to remain robust at 2.1% in 2025, although a gradual slowdown is anticipated later in the year.  

Greece also has a high proficiency in English, ranking 8th among 116 countries on the EF English Proficiency Index. Since most locals can speak English, international businesses can set up shop in the Greece without facing a language barrier.

Greece’s employment rate stands at 60.9%, while the labor productivity goes as high as 69.9% in some regions. The following statistics further shed light on Greece’s economic and business environment:

  • Greece has a gross domestic product (GDP) of US 243.5 billion, which represents 0.23% of the global economy.
  • The UNCTAD’s World Investment Report 2024 revealed that foreign direct investments (FDI) coming into Greece have a valuation of USD 5.4 billion. In 2022, this figure reached a record level of USD 8.4 billion.
  • In 2023, Greece’s top export category was mineral fuels, oils, and distillation products, totaling USD 17.82 billion. The country also exported USD 1.68 billion worth of vegetable, fruit, and nut food preparations.
  • Greece’s GDP is forecasted to grow by 2.3% in 2025 and 2.2% in 2026.
  • Greece has been a member of the European Union (EU) since 1981. The membership allows Greece to participate in the EU’s single market.
  • Greece’s primary export partners include Italy, Germany, Turkey, and Cyprus.
  • The country comprises approximately 6,000 islands, which provide opportunities for tourism and leisure-related industries.

Together, these factors make Greece an attractive location to expand your business to. As we’ve mentioned, a significant portion of Greece’s population is self-employed. So, there’s a trend in the country to hire independent contractors rather than full-time employees.

However, when hiring and paying independent contractors in Greece, you have to comply with the country’s labor laws, taxation, and other guidelines. Misclassifying employees as independent contractors can lead to legal and financial consequences. Below, we explore the technicalities of hiring independent contractors in Greece so that you can avoid these issues.

What Are Independent Contractors in Greece?

Independent contractors in Greece are self-employed professionals who provide services to clients without being classified as employees. They operate under a business-to-business (B2B) framework and manage their own taxes, social security contributions, and work arrangements. These professionals typically work under service contracts rather than employment contracts.

In Greece, independent contractors are legally recognized as self-employed individuals (αυτοαπασχολούμενοι) or freelancers (ελεύθεροι επαγγελματίες). They must register with the Independent Authority for Public Revenue (AADE) and obtain a Tax Identification Number (AFM) to operate legally.

Plus, they must contribute to Greece’s social security system (EFKA), which provides access to healthcare and pension benefits. They may work across sectors like IT, consulting, creative services, marketing, and so on.

Differences Between Employees and Independent Contractors in Greece

Hiring in Greece generally falls into two categories: independent contractors and employees. While both contribute to business operations, they are legislatively different.

Legal Classification

Employees in Greece work under a formal labor contract and are protected by Greek labor laws (Law 4172/2013 and Law 3850/2010). They have fixed working hours, job security, mandatory benefits, and legal protections against unfair dismissal.

Meanwhile, independent contractors are not covered by labor laws governing employees. Instead, they must handle their own legal and tax compliance. They also typically do not get the same benefits as employees.

Benefits and Protections

Employees in Greece are entitled to various benefits, including:

  • Social security contributions (EFKA) paid by the employer and employee
  • Paid leave, sick leave, and parental leave
  • Health insurance and pension benefits
  • Severance pay in case of termination

Independent contractors do not receive these benefits from their clients. Instead, they must:

  • Arrange private health insurance if they want additional coverage
  • Pay their own insurance, ranging from EUR 244.65 to EUR 659.39
  • Handle their own retirement saving

Payment and Taxes

Employees receive a fixed salary, often with holiday bonuses and additional allowances. Their income tax is deducted at source by the employer through the Pay-As-You-Earn (PAYE) system. The personal income tax rate in Greece ranges from 9% to 44%, depending on earnings.

On the other hand, independent contractors are paid per project. They may also have an hourly rate. They have to issue invoices to their clients and file their own taxes. If they are registered as a sole proprietorship, they also have to pay 22% of corporate tax.

Work Flexibility

Full-time employees in Greece have to follow a structured schedule. They must meet their full working hours and report to a manager. According to Greek labor laws, a week has 40 working hours.

Independent contractors have more flexibility in their work schedules. They can set their own hours and choose their own clients. If they have the time and resources, they may even work with multiple businesses at the same time.

Why Hire an Independent Contractor in Greece?

Let’s take a look at a few reasons hiring independent contractors in Greece is a good choice for businesses.

Cost-Effectiveness

When you hire freelancers and independent contractors, you don’t have to offer paid leave or fringe benefits. You don’t even make healthcare contributions for your contractors. However, if you were to hire full-time employees, you’d have to provide all these things on top of an average salary of up to EUR 17,685 per year.

Reduced Administrative Burden

Since independent contractors handle everything admin-related themselves, employers don’t have to do much for them. It’s less hassle. Plus, contractors are not subject to Greek labor laws regarding leave or termination, giving companies more flexibility in managing their workforce.

Access to Talent

As we’ve mentioned, the labor force in Greece is highly educated and skilled. So, you’re getting access to top talent when you hire independent contractors. You can tap into a diverse pool of professionals with specialized skills and experience without having to commit to hiring them long-term.

LEARN MORE

Flexibility in Scaling Operations

As a business, when you want to scale, you should be prepared to spend money. However, you can cut down some of these costs by working with independent contractors.

Similarly, you can hire them for seasonal needs or short-term projects. If your business has fluctuating workloads, bringing independent contractors on board is more cost-effective and feasible than hiring full-time employees. Such flexibility is especially useful for small businesses or startups that are still growing or dealing with project-based work.

Labor Laws in Greece

We’ve already mentioned that there are two laws governing how people are employed in Greece. Let’s take a closer look at these laws and what they mean for employees and independent contractors.

Working Hours

The total number of working hours across most industries in Greece is 40. However, across some industries, the government has introduced a six-day working week, which has increased the number of working hours.

In these industries, like manufacturing, employees have the option to work an extra eight-hour shift or two additional hours every day at a top-up of 40% of their hourly rate.

In contrast, independent contractors usually do not have set working hours. They can work whenever they want as long as they meet their deadlines.

Holidays

Employees in Greece are entitled to paid annual leave from their first day of work without needing to complete a minimum period of service. The leave is granted on a pro-rata basis, depending on the length of employment.

For a five-day workweek, employees receive 20 days of annual leave, while those on a six-day workweek get 24 days. The limit increases annually, reaching a maximum of 26 days for a six-day week and 22 days for a five-day week.

Long-term employees receive additional leave, with those having 25 years of experience entitled to 31 days (six-day week) or 26 days (five-day week). Working mothers in Greece also get a maternity leave of up to six months.

Payment System

Employees get paid by their companies through a bank transfer into their Greek bank account on a monthly basis. They may also get bonuses and fringe benefits.

Independent contractors typically choose their payment modes with mutual agreements with their clients. They can get paid via a bank or an online payment service on a weekly, bi-monthly, monthly, or per-project basis.

Fringe Benefits

While Greek employees get a number of fringe benefits like health insurance or transportation allowances, independent contractors are not entitled to these perks. They have to make all these arrangements for themselves.

Penalties for Misclassification

Greek law has stringent requirements for properly classifying employees and independent contractors. Companies that misclassify their workers can face legal repercussions, along with fines and reputational damage. The penalties may include retroactive social security and tax liabilities plus compensation for unpaid benefits and overtime pay.

Key Considerations for Hiring an Independent Contractor in Greece

Keep the following things in mind when hiring independent contractors in Greece.

Do Your Research

Make sure the contractors you’ve hired possess the skills and knowledge you need for your projects. You can check their portfolios and references before working with them. It’s best to use a talent platform or recruitment agency to find and vet independent contractors.

Create a Contract

Don’t make the mistake of keeping everything verbal. Instead, create a written contract covering everything from project timelines to payment terms. Both parties should agree on its terms.

Decide on a Payment Method

Discuss and agree on a payment method that works best for everyone. You can use online payment channels, local bank transfers, or any other method acceptable to all parties.

Classify Independent Contractors Properly

Most importantly, they should be classified as independent contractors and not full-time employees. They do not get the same benefits as permanent employees do. Discuss this distinction with your contractors before starting the project so that everyone is on the same page.

Taxation Laws

Greece imposes the following taxes on independent contractors: social security contributions, VAT, and income tax. Here’s how it works.

Income Tax

Since independent contractors are self-employed, they have to pay according to the country’s progressive tax system themselves.

 Annual Income (EUR)Tax Rate
Up to 10,0009%
10,001 – 20,00022%
20,001 – 30,00028%
30,001 – 40,00036%
Over 40,00044%

Value-Added Tax (VAT) Requirements

Most independent contractors in Greece must register for VAT unless they qualify for an exemption. While the standard rate is 24%, reduced rates of 13% and 6% may apply to some services. Contractors who make less than EUR 10,000 per year may get VAT exemptions.

How to Pay an Independent Contractor in Greece?

The following options are standard across industries.

Bank Transfers (Local & International)

You can pay through:

  • Local Bank Transfers: Payments within Greece can be made through local banks such as Alpha Bank, Eurobank, National Bank of Greece (NBG), and Piraeus Bank.
  • International SWIFT Transfers: For contractors working remotely, businesses can make international payments through SWIFT using global banks like HSBC, Citibank, and Deutsche Bank.

Some online remittance services also provide lower fees and better exchange rates for international payments, including platforms like TransferWise (Wise) and Revolut.

Online Payment Platforms

Digital payment solutions are quite popular among contractors in Greece. Some common ones are Payoneer, Wise, and PayPal.

Payment Through Freelance Marketplaces

If the contractor was hired through a freelance marketplace, payments are typically processed through the platform itself. These marketplaces offer secure payment systems to protect both parties. But make sure it’s a trusted marketplace, like Upwork, Fiverr, Freelancer, Toptal, and so on.

How to Convert an Independent Contractor to an Employee in Greece?

If you’ve decided to bring an independent contractor into your team for a full-time role, offer them a formal employment contract first. After that, make sure they are registered with IKA for social security contributions.

You will also need to update tax records and withhold income tax from their salary according to the Greek tax system. Also, they should be offered paid leave and other mandatory benefits to which they are entitled. Most importantly, terminate the independent contractor agreement to prevent any legal conflicts when transitioning to full-time employment.

Top Independent Contractors Providers in the Greece

Want to make hiring independent contractors a breeze? The following providers can help.

Remote People

Remote People homepage new

Remote People provides contractor hiring services in Greece, enabling companies to engage local talent without establishing a legal entity.

The service covers contract compliance under Greek labor regulations, management of tax obligations, and support for multi-currency payments such as AMD, EUR, and USD. Onboarding is streamlined, giving employers the assurance that payroll and legal requirements are fully managed.

Globalization Partners

Globalization-Partners-homepage.webp

Globalization Partners is a trusted EOR with a strong presence in Greece. They offer end-to-end solutions for hiring and managing independent contractors, including compliance with Greek labor laws and employee benefits.

Their platform helps onboard contractors quickly while maintaining legal compliance. Globalization Partners also handles all aspects of work permits and visas.

Papaya Global

Papaya Global homepage

Papaya Global is another excellent choice for hiring independent contractors in Greece. Their cloud-based platform streamlines global payroll and contractor management.

Papaya Global also offers contractor classification support, tax and social security compliance, and risk mitigation services. So, you can’t go wrong with them.

Velocity Global

Velocity Global Homepage new

Velocity Global is one of the most well-known PEOs in the world, providing services across 185+ countries. They have an AI-powered platform where you can manage your workforce, including independent contractors. The platform makes it easy to onboard and pay all workers from the same place.

Velocity Global also offers multiple other services, such as visa processing, risk management, HR support, and independent contractor classification support.

Expand and Succeed with Independent Contractors in the Greece

While full-time employees are essential for long-term growth, there are times when bringing on independent contractors makes more sense – especially for short-term projects or highly specialized roles. Embracing the benefits of hiring contractors in Greece can help you scale quickly and cost-effectively without the commitment of permanent hires.

If you’re exploring contractor hiring solutions or need support with compliant onboarding and management, contact Remote People. Our team is here to help you grow your business with flexible, efficient workforce strategies tailored to your needs.