Employee benefitsin Serbia

Every employee in Serbia is compulsorily insured with the Republic Health Insurance Fund (RFZO), the public insurer that pays for treatment by a chosen family doctor, specialist and hospital care in the public network, medicines on the national list and medical aids. Cover extends to the employee's family members who are not insured in their own right, including a spouse and children up to age 18, or up to 26 while in education.

The health contribution is 10.3% of gross salary, split equally: the employee pays 5.15% through payroll withholding and the employer adds 5.15% on top of gross pay. In 2026 contributions are charged on monthly earnings between RSD 51,297 and RSD 732,820. The Fund also pays sick pay from the 31st day of a sickness absence, after the employer has covered the first 30 days.

Under the 2023 Occupational Safety and Health Law every employer must adopt a written risk assessment for each workplace, train employees in safe work when they start and when conditions change, and organise first aid. Employees in roles designated as increased-risk, and night workers, must have a medical examination before starting and periodically afterwards. Any employee may ask for an examination matching the risks of their job at regular intervals, at least every five years. The employer pays for all examinations, which are carried out by an occupational medicine provider. Employers must also insure employees against work injuries and occupational diseases. For home and remote work the employer may adopt a separate risk assessment with the employee's participation.

Employer-paid voluntary health insurance, known in Serbia as dobrovoljno zdravstveno osiguranje (DZO), gives employees faster access to private specialists, diagnostics and preventive check-ups alongside the public system run by the Republic Health Insurance Fund (RFZO). It is a standard benefit in the technology sector: 71% of IT employees reported employer cover in a mid-2023 survey of IT companies. Across all sectors about a quarter of employees have it, 25% in mid-2025 compared with 22% in 2024, and it is the only paid benefit whose availability and employee demand keep rising; 30% of employees rank it among their most valued benefits.

Employers buy group policies from Serbian insurers. Employees value specialist examinations (70%) and diagnostics (60%) most, followed by preventive check-ups (43%), laboratory tests (41%), hospital treatment and surgery (24%), and eye or dental care (15%). Facing medical inflation in 2025, 74% of employers with cover kept the same package at a higher price, 14% moved to a cheaper package and 12% introduced employee co-payments. Cover for employees' children is less common, received by 13% of employed parents.

Employer-paid premiums are free of salary tax and contributions up to RSD 8,677 a month per employee, shared with any voluntary pension contribution; any excess is taxed as salary.

Some employers provide psychological counselling through an employee assistance programme (EAP), a confidential service offering short-term counselling and advice, or through wellbeing platforms. In mid-2025, 10% of employees across all sectors had such support, up from 7% in 2024; in IT companies 17% had it in 2023 and 22% had one-to-one counselling or psychotherapy through a wellbeing programme. Demand is high: 19 of 20 employees report at least one wellbeing problem, mostly stress, and support in crises and counselling top the list of what employees want from employers. The service is bought from external providers.

Some employers fund team-building events, gym or sports memberships and wellbeing programmes. In mid-2025, 22% of employees across all sectors had team-building activities and 9% had paid sports activities, both up slightly on 2024. They are more widespread in technology companies, where 62% of employees had team building and 33% paid sport in 2023, and 32% had fitness or yoga through a wellbeing programme. Employee interest in these classic benefits is declining compared with flexibility and health insurance. Individual sports memberships are taxed as salary.

Some employer-paid health insurance packages include dental care, and 15% of employees with voluntary health insurance rank eye or dental care among the services they value most.

Employer-paid health insurance packages in Serbia can include eye care, and 15% of employees with voluntary health insurance rank eye or dental care among their most valued services. No survey measures how many employers provide optical cover.

Employers must insure all employees against work injuries and occupational diseases and pay the full cost of that insurance under the 2023 Occupational Safety and Health Law. On top of the insurance duty, an employee injured at work or suffering an occupational disease receives 100% of average earnings from the first day of incapacity, paid by the employer for the entire absence while employment continues; the Republic Health Insurance Fund (RFZO) takes over only if employment ends during the absence.

The employer must also compensate damage caused by a work injury or occupational disease. If the injury leads to a complete loss of working capacity, the state Pension and Disability Insurance Fund pays a disability pension regardless of length of insurance. There is no separate employer injury-insurance levy in the payroll contribution rates.

Employees build entitlement to a state old-age, disability and survivors' pension through compulsory insurance with the state Pension and Disability Insurance Fund. The contribution is 24% of gross salary: the employee pays 14% through payroll withholding and the employer pays 10% on top of gross pay.

Contributions are charged on actual gross salary but never below the minimum monthly base and never above the maximum. For 2026 the bases are RSD 51,297 (35% of the national average salary) and RSD 732,820 (five times the average); both are recalculated every year from 1 January. Anyone earning less than the minimum base, other than some part-time cases, is still charged on the minimum base.

An old-age pension is available at 65 with at least 15 years of insurance, or at any age after 45 years of insurance. Women with 15 years of insurance qualify earlier during a transition: at 64 in 2026 and 64 years and two months in 2027.

Employees contribute 0.75% of gross salary to unemployment insurance; employers pay nothing toward it. A person who loses a job through redundancy, dismissal for poor performance, the end of a fixed-term or probationary contract, or the employer's insolvency can claim a monthly cash benefit from the National Employment Service (NSZ), the public employment agency, provided they were insured for at least 12 of the last 18 months. A person who resigns or is dismissed for misconduct qualifies only after again being insured for 12 months.

The claim must be filed within 30 days of the job ending to be paid from the first day. The benefit is a daily base (RSD 1,507.12 from February 2026) multiplied by a personal coefficient comparing the person's earnings in their last 12 months with the national average salary. From 1 February 2026 a full month pays at least RSD 33,745 and at most RSD 78,226. It lasts three months for one to five years of insurance, six months for five to 15 years, nine months for 15 to 25 years and 12 months above 25 years, or 24 months for someone within two years of pension eligibility.

An employee dismissed because their job is no longer needed for technological, economic or organisational reasons must receive severance before the dismissal takes effect. The legal minimum is one-third of the employee's salary for each completed year of employment with that employer, where salary means the average monthly pay received in the three months before the month of payment. Service with a predecessor employer after a merger or transfer, and with related companies, counts; a change of shareholders does not restart the count.

For example, an employee averaging RSD 210,000 a month with six completed years receives at least RSD 420,000. A collective agreement, the employer's rulebook or the employment contract can set a higher amount, but cannot count service with other, unrelated employers. Severance is not paid twice for the same years, and it is not tied to a statutory notice period: redundancy dismissals take effect on delivery of the decision once severance has been paid. The dismissed employee can then claim unemployment benefit.

When an employee leaves work to retire, the employer must pay a retirement severance of at least two average monthly salaries in Serbia, using the latest figure published by the national statistics office rather than the employee's own pay. The employer's general act, such as a collective agreement or rulebook on work, can set a higher amount. The payment applies to every retiring employee regardless of length of service with that employer and is separate from redundancy severance.

Employers must reimburse funeral costs when an employee's spouse or child dies, and pay them to the family when an employee dies, in the amount set by the general act. They must also compensate damage from work injuries and occupational diseases. Beyond these obligations, a collective agreement, rulebook or contract may provide solidarity aid, jubilee awards and other payments.

Several social payments are free of salary tax and contributions up to annual caps set in the Personal Income Tax Law for 2026: solidarity aid for illness, rehabilitation or disability of the employee or a family member up to RSD 57,827; aid on the death of a family member up to RSD 101,194; aid on the birth of a child up to the national average salary per newborn; New Year and Christmas gifts for employees' children under 15 up to RSD 14,457 per child a year; and documented medical treatment costs. Amounts above the caps are taxed as salary.

Some employers pay into a voluntary pension fund for employees, the third pillar of Serbia's pension system, managed by licensed fund companies supervised by the National Bank of Serbia (NBS). In mid-2025, 9% of employees across all sectors had this benefit, up from 7% in 2024; 8% of IT employees had it in 2023. National Bank figures show about 222,500 members, 9.6% of employed people, paying into voluntary funds in early 2024, a figure that also includes people saving on their own.

Employer contributions are free of salary tax and social contributions up to RSD 8,677 a month per employee, shared with any voluntary health insurance premium. Members can draw their savings from age 58, taking up to 30% as a lump sum and the rest as programmed withdrawals or an annuity.

Employer-paid group life insurance is rare in Serbia: 6% of employees across all sectors had it in mid-2025, up from 5% in 2024, and 6% of IT employees in 2023, and its importance to employees is falling. Where it is offered, group cover against death from illness paid for all employees is not treated as salary, so it is free of salary tax and contributions; cover bought for selected employees is taxed. Benefit amounts and salary multiples are set by the insurer and the employer.

A small number of Serbian employers lend money to employees interest-free, typically toward buying a flat or a car. Only 3% of employees across all sectors had this benefit in mid-2025, and 7% of IT employees in 2023, although 22% of employees name it among their most valued benefits. The principal is repaid from salary under the loan agreement.

Serbian employers may buy group accident insurance, including cover for work injuries, and group insurance for serious illness and surgery that pays a cash sum on diagnosis or operation; the Labour Law names both as forms of additional social protection. When bought for all employees, the premiums are not treated as salary and are free of salary tax and contributions. No survey measures how many Serbian employers provide these policies.

Employees are entitled to at least 20 working days of paid annual leave per calendar year, counted on a five-day week. The employer's general act or the employment contract must increase this minimum for factors such as work contribution, working conditions, experience and qualifications, so many employees receive a few days more. Public holidays, paid leave and certified sick days are not counted as leave, and an illness during leave interrupts it.

The right arises after one month of continuous work. In the year employment starts or ends, the employee earns one-twelfth of the annual entitlement for each month worked. Leave can be split, but the first part must be at least two consecutive working weeks in the calendar year and the rest must be used by 30 June of the following year; leave missed because of maternity or childcare leave can also be used by that date. The employer schedules leave after consulting the employee and delivers a written leave decision at least 15 days before it starts.

Leave is paid at the employee's average earnings over the previous 12 months, and the employee also receives the annual leave allowance (regres). Leave cannot be waived or replaced with money except when employment ends, when unused days are paid out.

An employee who cannot work because of illness or an injury outside work receives at least 65% of their average earnings over the 12 months before the month the illness started, and never less than the minimum wage. The employer pays this for the first 30 days of each absence. From day 31 the Republic Health Insurance Fund (RFZO) funds it at 65% of the same 12-month average, capped at the average of the maximum contribution bases and not below the minimum wage; the employer pays it out after the Fund transfers the money.

Work injuries and occupational diseases are paid at 100% by the employer from the first day for the whole absence. Illness related to maintaining a pregnancy is paid at 100%: by the employer for the first 30 days, then 65% by the Fund and 35% from the state budget. There is no fixed maximum length; sick pay continues while the incapacity lasts, with medical commission reviews and a referral for disability assessment after six months of continuous absence or 12 months within 18.

Sickness is certified by the employee's chosen doctor. Since 1 January 2026 certificates reach the employer electronically through the e-Bolovanje system, replacing paper sick notes; the employee must still tell the employer of the absence within three days.

An employee who must care for a sick or injured close family member receives sickness compensation at 65% of average earnings over the previous 12 months, certified by the chosen doctor. Care for a child under seven, or for an older family member with a severe disability, is covered for up to 15 days per illness, extendable by a medical commission to 30 days. Care for any other family member over seven is covered for up to seven days, extendable to 14. For a child under three, the Republic Health Insurance Fund (RFZO) pays from the first day; in other cases the employer pays the first 30 days. For a child with a serious illness such as cancer or severe brain injury, the Fund can extend the right in six-month reviews at 100%. The right generally applies when both parents are insured or the child has one parent.

Employees receive up to five working days of paid leave a year for their own marriage, a spouse's childbirth, serious illness of a close family member and other events set by the employer's general act or contract, with the split between events fixed in those documents. Separately, they receive five working days of paid leave on the death of a close family member and two consecutive days for each voluntary blood donation, including the donation day.

Close family means a spouse, children, siblings, parents, adoptive parents and children, and guardians. The employer may grant leave for other relatives or household members, and a general act or contract may give more days or a wider circle of relatives. Paid leave is compensated at the employee's average earnings over the previous 12 months.

In addition to the national calendar, employees have the right not to work on the main holidays of their own faith. Orthodox Christians may take the first day of their krsna slava, the family patron saint's feast whose date differs from family to family. Catholic and other Christian employees may take the first day of Christmas and Easter from Good Friday to Easter Monday under their own calendar. Muslim employees may take the first day of Ramadan Bayram and of Kurban Bayram, and Jewish employees the first day of Yom Kippur.

When the day falls on a scheduled working day, the employee is paid at average earnings for the previous 12 months, as for other non-working holidays. Religious days are not moved when they fall on a weekend. The employee should tell the employer in advance which day applies, particularly for krsna slava.

An employer may grant unpaid leave at the employee's request, for example for study, travel or family reasons. The law sets no minimum or maximum length; the duration is agreed case by case or under the employer's general act. During unpaid leave the employee's rights and duties are suspended unless the law, general act or contract provides otherwise, so salary stops. Leave for education, professional examinations or training is not a statutory entitlement and depends on the collective agreement, rulebook or individual agreement.

Above the statutory 20 working days, which employer rules must already increase for experience, qualifications and working conditions, some employers grant additional paid days off as a benefit. In mid-2025, 23% of employees across all sectors had extra days off beyond the legal minimum, up from 18% in 2024; in IT companies the share was 41% in 2023. Extra days off are the benefit working parents most want (67%), and 29% of all employees rank them among their top benefits. The days are set in the rulebook, collective agreement or contract.

A pregnant employee takes maternity leave from 28 days before the expected birth at the latest, or from 45 days before on a doctor's recommendation. Maternity leave runs until three months after the birth and is followed by childcare leave until 365 days from the start of maternity leave, so the protected period totals one year. For a third or later child, or for multiple births in specified cases, the total is two years. If the baby is stillborn or dies, the mother keeps maternity leave until three months after the birth.

Pay for the whole period is a salary compensation from the state, not from the employer. It equals the average of the employee's monthly contribution bases over the 18 months before the month leave starts, capped at five national average monthly salaries. During the maternity-leave portion it is at least the minimum wage, calculated on 184 hours plus taxes and contributions. The ministry responsible for family support pays it each month directly to the employee's bank account after the local authority approves the claim.

Dismissal is prohibited during pregnancy, maternity and childcare leave, and a fixed-term contract is extended until the leave ends. A mother who returns before the child's first birthday and works at least six hours a day is entitled to 90 minutes of paid breaks or a shorter working day to breastfeed. Pregnant employees also have paid time off for prenatal check-ups, and a parent of a child under three can be asked to work overtime or at night only with written consent.

Serbia has no separate statutory paternity leave. A father takes paid days at the birth from the general paid-leave allowance of up to five working days a year, which also covers marriage and serious illness of a close family member; the employer's general act or the contract sets how many of those days apply to a birth. The employer pays these days at average earnings for the previous 12 months.

Fathers have wider rights through childcare leave. After the first three months following the birth, the father can take the remaining childcare leave instead of the mother, until the end of the one-year period (two years for a third or later child), with state-paid salary compensation based on his own 18-month average contribution base. He can take maternity leave itself only if the mother dies, abandons the child, is prevented from caring for the child by serious illness or imprisonment, or is not employed.

Beyond maternity leave, Serbian law gives parents several further protected absences. Childcare leave after the first three months can pass to the father by agreement. A parent of a child who needs special care because of a severe developmental disability may, after childcare leave ends, take further leave or work half-time until the child turns five, with state salary compensation. Either parent, an adoptive parent or a guardian may also take unpaid leave until the child turns three, during which employment rights are suspended.

Adoptive parents, foster carers and guardians of a child under five may take eight continuous months of leave from the child's placement, including the pre-adoption adjustment period. If the child is placed before three months of age, the leave runs until the child is 11 months old. State salary compensation is paid on the same 18-month base as maternity pay.

New Year gift packages or vouchers for employees' children are the most widespread family benefit in Serbia: 77% of employed parents received them in mid-2025. Employers may give children up to age 15 a gift for Christmas and New Year, and the gift is free of salary tax and contributions up to RSD 14,457 per child a year for payments from February 2026; amounts above that are taxed as salary. Parents rank these gifts low among the support they want (16%), well behind extra days off and flexible hours.

Some employers make a one-off cash payment when an employee has a baby: 24% of employed parents had received one in mid-2025. The payment is set by the collective agreement, rulebook or a management decision. It is free of salary tax and contributions up to the national average monthly salary per newborn, with any excess taxed as salary. Few employers go further: 13% of employed parents receive health insurance for their children, and 2-3% receive parenting counselling or education.

Serbian law does not require a 13th or 14th monthly salary, a Christmas bonus or any other fixed annual bonus. Bonuses and awards for contributing to the employer's results are part of salary when the general act or employment contract provides for them, and once promised they must be paid and are taxed like salary. An employer may also share annual profit with employees through the employment contract or a management decision. The statutory pay additions that do apply are premiums for overtime, night and holiday work, the 0.4% seniority supplement per year of service, the meal allowance and the annual leave allowance (regres).

Employees are entitled to an annual leave allowance, known as regres, to help cover the cost of taking holiday. The Labour Law makes it a right but sets no minimum amount: the employer's collective agreement, rulebook on work or the employment contract fixes the amount and payment method, for example a single payment before the main holiday or monthly instalments added to pay. Employees earning the minimum wage receive it on top of the minimum wage.

Regres counts as salary, so it is subject in full to the 10% salary tax and to employee and employer social contributions; there is no tax-free allowance for it.

Employee equity is still relatively rare in Serbia but legally well supported. Since April 2020 a limited liability company can grant employees a financial instrument giving the right to acquire an ownership stake, known as finansijski instrument - pravo na sticanje udela (FIPSU), alongside shares and share options in joint-stock companies. Shares, options or stakes in the employer or a related company acquired free or at a discount are exempt from salary tax and contributions, provided the employee keeps them for two years. They become taxable salary if sold within two years, bought back by the employer, or if the employee leaves within two years, except on involuntary termination, retirement or a move to a related company. Later gains on sale are taxed as capital gains. A 2023 expert guide recommends that start-ups consider employee ownership only after a first funding round.

Bonuses in Serbia are discretionary. Employers that pay them use designs such as periodic bonuses expressed as a percentage of annual salary, performance pay tied to key performance indicators (KPIs), one-off loyalty bonuses after a set period of service, and year-end or 13th-salary payments. Once a bonus is promised in the rulebook or contract it must be paid. Bonuses are part of salary and taxed as such. Profit sharing under the contract or a management decision is taxed separately as other income at 20%.

Phantom equity gives an employee a cash payment linked to the value or growth of the company's shares without transferring ownership. Serbian law has no specific regime for it, so a phantom award is treated as a cash bonus from employment: it is taxed as salary, with salary tax and social contributions, when paid, and it does not benefit from the two-year exemption for actual shares and options. Award terms, vesting, payout events such as a sale of the company, and treatment of leavers are set entirely by the plan.

Employers may pay jubilee awards to recognise long service, for example at 10, 20 or 30 years, under a collective agreement, rulebook or contract. The law does not require them or set amounts. Jubilee awards are free of salary tax and contributions up to RSD 28,912 a year for payments from February 2026; any excess is taxed as salary. Other recognition gifts to employees are taxed as salary.

Long-term cash incentives in Serbia are individual arrangements rather than a regulated product. Examples include retention bonuses paid after a fixed period and exit bonuses paid to a director on a successful sale or change of ownership if still employed on a set date. Deferred cash is taxed as salary when paid; there is no tax deferral scheme. Terms on vesting, performance conditions and leavers are set in the contract.

Employees are entitled to an allowance for meals during the working day, known as topli obrok, unless the employer provides meals in another way, such as a canteen. The allowance must be expressed in money. The law sets no minimum: the amount is fixed by the collective agreement, the rulebook on work or the employment contract, usually as a daily or monthly sum paid with salary. Minimum-wage earners receive it in addition to the minimum wage.

The meal allowance counts as salary and is taxed in full, with salary tax and social contributions; meal vouchers do not create a separate tax-free benefit.

Employees are entitled to reimbursement of the cost of travelling to and from work, at least at the price of a public-transport ticket, unless the employer provides its own transport. The collective agreement, rulebook or employment contract sets how it is calculated and paid. Moving home after signing the contract does not increase the employer's obligation without its consent.

Reimbursement is free of salary tax and contributions up to the documented monthly public-transport ticket or actual travel cost, capped at RSD 5,782 a month for payments from 1 February 2026; any excess is taxed as salary.

When an employee works remotely or from home under a remote-work contract, the contract must state which work equipment the employer will buy, install and maintain, whether the employee uses their own equipment and how that use is reimbursed, and how other work costs, such as part of internet and electricity, are reimbursed and calculated. The law sets no fixed amount or tax-free allowance: the employer and employee agree the method, which may be a monthly flat sum or reimbursement of documented costs, and the payment is in addition to salary.

Serbian law recognises employment carried out away from the employer's premises, covering both remote work and work from home. The employment contract must include extra terms on working time based on output norms, how work is supervised, the equipment the employer provides, the use of the employee's own equipment and how it is reimbursed, and other costs and how they are calculated. A remote employee's base salary may not be lower than that of an employee doing the same job on the employer's premises.

Rules on working time, overtime, night work, rest and leave apply unless the general act or contract sets a different schedule, and workloads may not prevent breaks and rest. Under the 2023 Occupational Safety and Health Law, home work and remote work are defined as work using digital tools outside the employer's direct control; employers may adopt a written risk assessment for such work with the employee's participation. There is no statutory right to request remote work. A broader Labour Law revision is in drafting, targeted for late 2026 or early 2027, and is not in force.

Flexible working hours, where employees choose start and finish times around core hours, are widespread in Serbian technology companies: 66% of IT employees had them in a mid-2023 IT-sector survey. Across all sectors 28% of employees had flexible hours in mid-2025, up from 25% in 2024, making them, with remote work, the most widely available non-statutory benefit. They are also the benefit employees value most: 41% name flexible hours among their top benefits, and 63% of working parents want flexible or shorter hours, although only 9% receive them as a parent-specific benefit. A four-day week remains rare, offered to 3% of employees.

Flexible hours are set in the employer's rulebook or the employment contract within the statutory limits on daily and weekly working time and rest.

Hybrid and remote work is standard in Serbia's technology sector and much less available elsewhere. In a mid-2023 IT-sector survey, 89% of IT employees could work from home, 45% choosing freely and 34% to an agreed extent, and about 58% of all IT working time was done remotely; larger IT employers allowed more remote days. Across all sectors, 28% of employees had a remote option in mid-2025, up from 26% in 2024, while 45% work in jobs where it is not possible and 27% are not allowed to work from home. Employers are tightening policies: 18% of employees in companies where remote work is possible said more office time is now required, and 40% of employees rank remote work among their most valued benefits.

Arrangements for remote work are set in the employment contract or an annex, which must state working time, supervision, the equipment the employer provides and how the employee's own equipment and other costs are reimbursed. Pay may not be lower than for the same job in the office.

Separately from the statutory meal allowance, which every employee receives in money unless meals are provided, some employers serve lunch at work through a canteen, catering or food delivery. In mid-2025, 17% of employees across all sectors had lunch provided, up from 15% in 2024, and 19% of IT employees in 2023. An employer that provides meals can do so instead of paying the cash meal allowance. Meal vouchers have no separate tax-free status, so their value is taxed as salary.

Some Serbian employers pay for courses, certifications and conferences. In mid-2025, 24% of employees across all sectors had paid training as a benefit, up from 21% in 2024; in IT companies the share was 44% in 2023, down from 58% the year before. Paid formal-education scholarships are rare, at 3% of employees. Study or exam leave depends on the collective agreement or rulebook.

Beyond the statutory reimbursement of public-transport costs, some employers in professional roles pay higher transport allowances, cover parking or fuel, or provide company transport. No survey measures how widespread these top-ups are. Commuting reimbursement above RSD 5,782 a month, and fuel or parking for private travel, is taxed as salary.

Employers supply work equipment such as laptops and phones under their own rules, and for remote employees the contract must state which equipment the employer supplies and maintains. Whether employers also fund home-office furniture or a set-up allowance, and how much, is not measured for Serbia.

Relocation packages for staff moving to Serbia from abroad can include temporary accommodation, moving costs, local transport, language lessons and help with the single residence-and-work permit. Expatriates receive the same statutory leave and benefits as local employees. Qualifying people moving to Serbia for hard-to-fill permanent roles can also pay salary tax on only 30% of the base for five years. No survey measures how many employers provide relocation packages or their value.

Serbian law treats anyone working under the employer's direction as an employee unless the work fits one of the specific non-employment contracts in the Labour Law. These are temporary and occasional work of up to 120 working days in a calendar year (for unemployed people, part-time employees and pensioners), a service contract for a defined task outside the employer's core activity, supplementary work for someone already employed full-time elsewhere (up to one-third of full time), and professional training contracts. Working without any written contract is treated as indefinite employment from the first day.

When a client engages a registered sole trader, an income-tax independence test applies. If the trader meets at least five of nine criteria for one client and its related companies, such as the client setting working hours, providing premises or tools, or supplying at least 70% of annual income, or working 130 or more days for that client in 12 months, the fees are reclassified as 'other income' taxed at 20% plus contributions. Employing someone without the required contract carries fines of RSD 800,000 to 2,000,000 for a company and RSD 300,000 to 500,000 for a sole trader, plus back taxes and contributions.

Employment in Serbia starts with a written employment contract signed before the employee begins work. If there is no written contract, the person is treated as employed indefinitely from the first day. The contract is made in at least three copies, one for the employee, and a copy must be kept at the workplace. The employer must register the employee with the Central Register of Compulsory Social Insurance (CROSO), the national social-insurance register, before work starts.

The contract must state the employer and its seat, the employee's name and residence, required education, job title and description, place of work, whether it is indefinite or fixed-term (with the term and reason), start date, working time, the base salary amount, the elements of pay and other income, payment dates and daily and weekly hours. Pay elements and hours may instead refer to a collective agreement or rulebook. Employers with more than ten employees must adopt a rulebook on organisation and job descriptions. The minimum working age is 15, and discrimination on grounds such as sex, pregnancy, health, disability, ethnicity, religion, family status, sexual orientation and union membership is prohibited.

A fixed-term contract needs an objective reason, such as a defined period, task or event. Fixed-term employment with the same employee may not exceed 24 months in total, with or without breaks; a break shorter than 30 days does not reset the count. Longer terms are allowed to replace an absent employee until their return, for a defined project until it ends, for a foreign national until the work permit expires, for up to 36 months at an employer registered less than a year before, and for an unemployed person within five years of retirement eligibility. If a fixed-term contract breaches these rules, or the employee keeps working for five working days after it expires, the employment becomes indefinite. A fixed term is extended automatically if the employee is on maternity or childcare leave when it ends.

An employment contract may bar the employee from competing work on their own account or for others without the employer's consent, but only where the job gives the employee access to new and particularly important technological knowledge, a wide range of business partners, or important business information and secrets. The general act and contract must define the territory covered. A restriction after employment ends may last no more than two years and is valid only if the employer commits in the contract to pay the employee agreed monetary compensation; the law sets no minimum amount. An employer can claim damages for breach.

Salary must be paid at least once a month, by the end of the current month for the previous month at the latest, on the dates set in the general act or employment contract. Salary is paid only in money, so benefits in kind cannot replace it.

Salary consists of base pay, a performance element, statutory premiums, and bonuses or awards when the employer's rules provide for them, plus the meal allowance and regres. The contract must state the base salary amount. With every payment, and also for any month in which salary is not paid, the employer must give the employee a written payslip, with the reasons for non-payment where relevant. Equal pay for equal work or work of equal value is guaranteed. Absences such as annual leave, holidays and paid leave are compensated at average earnings over the previous 12 months.

Employees receive a seniority supplement, called minuli rad, of at least 0.4% of base pay for each full year of employment with their current employer. Service with a predecessor employer after a merger or transfer, and with related companies, counts. After ten years the supplement is at least 4% of base pay. A collective agreement or rulebook may set a higher percentage, and the supplement is added to other premiums such as overtime. Service with earlier, unrelated employers does not count toward the legal minimum.

Serbia sets its minimum wage as a net hourly rate, before taxes and contributions are added. For January to December 2026 it is RSD 371 net per working hour; for 2027 the Government has set RSD 405 net per hour, an increase of 9.2%, in a decision published in the Official Gazette of the Republic of Serbia, no. 75/2026.

The monthly minimum depends on working hours in the month. In 2026 a 160-hour month pays RSD 59,360 net, 176 hours RSD 65,296 and 184 hours RSD 68,264; the corresponding gross salary for 176 hours is about RSD 88,265, before employer contributions. In 2027, 176 hours pays RSD 71,280 net.

An employer that pays the minimum wage must do so under a decision whose grounds are set in its general act or the employment contract, and must explain to the representative union why it continues after six months. Minimum-wage employees still receive overtime, night and holiday premiums, seniority pay, the meal allowance, regres and commuting reimbursement on top.

Full-time work is 40 hours a week, normally eight hours a day over five days; an employer's general act can set a shorter full-time week of no less than 36 hours with full-time rights. Overtime is allowed only for force majeure, a sudden increase in work or unplanned work that must be finished by a deadline, and may not exceed eight hours a week or bring the working day above 12 hours. Hours can be redistributed for peak periods if the average over six months (up to nine under a collective agreement) does not exceed contracted hours, with a ceiling of 60 hours in any week.

Minimum pay premiums are 26% of base pay for overtime, 26% for night work between 22:00 and 06:00 unless already priced into base pay, and 110% for work on a public holiday, paid on top of the normal pay for those hours; premiums add up when several apply. There is no statutory premium for ordinary weekend work. The seniority supplement adds 0.4% per year of service.

Employees working six hours or more get a paid break of at least 30 minutes (15 minutes for four to six hours, 45 minutes above ten hours), at least 12 consecutive hours of daily rest and 24 hours of weekly rest, normally on Sunday.

An employment contract may include a probationary period of up to six months for the agreed job. During probation either the employer or the employee can end the contract with at least five working days' notice, and the employer must give reasons. If the employee has not shown the required skills by the end of probation, employment ends on the date set in the contract. Probation is optional, and the contract sets its length within the six-month maximum.

An employer must adopt a formal redundancy programme, after consulting the representative union and the National Employment Service (NSZ), the public employment agency, when within 30 days it plans to make redundant at least 10 permanent employees in a workforce of 21 to 99, at least 10% in a workforce of 100 to 300, or at least 30 in a workforce above 300; or at least 20 employees within 90 days regardless of size. The programme must explain the reasons, the employees affected and the measures to find them new work.

After a redundancy dismissal the employer may not hire someone else for the same job for three months, and the dismissed employee has priority if the need returns. When a business changes owner, merges or is transferred, the new employer takes over the existing employment contracts.

Serbian employment cannot be ended at will. An employer may dismiss only on legal grounds: poor results or lack of required skills, a final conviction for a work-related offence, breach of work duties or work discipline, or redundancy. Before dismissing for breach of duty or discipline, the employer must give a written warning with at least eight days to respond; before dismissing for poor performance, it must first give written notice of the shortcomings and a reasonable period to improve. Dismissal is a written, reasoned decision delivered personally.

Statutory notice applies only to dismissal for poor performance: 8 to 30 days depending on insurance service, as set in the general act or contract. Dismissal for misconduct and for redundancy has no notice period; redundancy requires severance paid in advance. An employee who resigns must give at least 15 days' written notice, or up to 30 days if the general act or contract says so. During probation either side gives at least five working days.

Employment also ends by written mutual agreement, at the end of a fixed term, and at age 65 with at least 15 years of insurance unless both sides agree otherwise. All outstanding pay, including compensation for unused annual leave at average earnings, must be paid within 30 days. Dismissal is prohibited during pregnancy and maternity or childcare leave. Employees can challenge a decision in court within 60 days; money claims expire after three years.

An employer in Serbia pays 15.15% of gross salary in social contributions on top of pay: 10% for pension and disability insurance and 5.15% for health insurance. There has been no employer unemployment contribution since 2019. The employee bears 19.9% through withholding (14% pension, 5.15% health and 0.75% unemployment) plus 10% salary tax, which the employer also withholds and pays.

Contributions apply between the 2026 monthly bases of RSD 51,297 and RSD 732,820. As an example, on a gross salary of RSD 100,000 in 2026 the employer pays RSD 15,150 in contributions, for a total cost of RSD 115,150; the employee's contributions are RSD 19,900 and salary tax is RSD 6,577.90, leaving net pay of RSD 73,522.10. Meal allowance, the annual leave allowance (regres) and commuting costs above the tax-free limit are added to salary and taxed in the same way, so they increase total cost.

Employers file a monthly individual tax return for each payment and pay tax and contributions when salary is paid.

Salary is taxed at a flat 10%, withheld by the employer. The tax base is gross salary minus a monthly non-taxable amount of RSD 34,221 in 2026 for a full-time employee (pro rata for part-time work). Amendments published in September 2026 raise the non-taxable amount to RSD 37,369 from 1 January 2027.

Higher earners also pay an annual personal income tax, filed and paid by 15 May of the following year. It applies when annual income exceeds three times the national average annual salary; for 2025 income that threshold was RSD 5,439,096. Income above the threshold, after personal deductions of 40% of the average annual salary for the taxpayer and 15% for each dependent family member (together capped at half of the taxable amount), is taxed at 10% up to six times the average annual salary and 15% above it. Taxpayers under 40 at year end deduct a further three average annual salaries from employment and self-employment income.

Serbia's corporate income tax rate is 15% and the standard rate of value added tax is 20%.

Serbia refunds part of the salary tax and social contributions on new hires who were registered as unemployed with the National Employment Service (NSZ) for at least six months, or under-24s in the Youth Guarantee programme. The refund is 65% when the employer hires one to nine such people, 70% for 10 to 99 and 75% for 100 or more; micro and small employers hiring at least two get 75%. The relief covers salaries paid until 31 December 2028; under amendments adopted in September 2026, from 2028 it is limited to 12 months per hire, requires a net increase in headcount and is capped at 50% of wage costs or EUR 5.5 million per employer a year.

Other reliefs suit start-ups and international hiring. A newly founded innovative company is exempt from salary tax on founders' salaries up to RSD 150,000 a month for 36 months if each founder holds at least 5% and is employed. Employers performing research and development pay only 30% of salary tax for staff directly working on it, in proportion to their time. Employees who move to Serbia for a hard-to-fill permanent role, earning more than RSD 439,692 a month (RSD 293,128 for under-40s returning from study abroad), pay salary tax on only 30% of the base for five years.

Almost every payment or benefit an employee receives from the employer, in cash or in kind, counts as salary and bears 10% salary tax plus employee and employer social contributions. The meal allowance and annual leave allowance (regres) are fully taxable. Specific exemptions apply up to caps that are indexed each year; from February 2026 they include commuting costs up to RSD 5,782 a month, domestic business-travel allowances up to RSD 3,471 a day, foreign travel allowances up to EUR 90 a day, use of a private car for business at 30% of fuel cost up to RSD 10,121 a month, documented accommodation and transport on business trips, and the social payments listed in the law.

Employer-paid premiums for voluntary health insurance and contributions to a voluntary pension fund are exempt up to RSD 8,677 a month per employee in total. Premiums for group accident insurance, group critical-illness and surgery insurance, and group life cover against death from illness are not treated as salary when paid for all employees. Shares, share options or ownership stakes given free or at a discount are tax-free if the employee keeps them for two years. Benefits above these limits are grossed up and taxed.

Employment rights in Serbia come from the Labour Law, collective agreements and employment contracts. Collective agreements exist at national, sector and employer level and may grant more than the law but not less. Where an employer has no union, or no union meets the representativeness threshold, the employer instead adopts a rulebook on work (pravilnik o radu) that sets items such as the meal allowance, regres, extra leave days and premiums. The Government may extend a sector collective agreement to employers that did not sign it, by a decision published in the Official Gazette. Employees may form and join unions, and dismissal for union activity is prohibited, with the burden of proof on the employer.

Most foreign nationals need a single permit (jedinstvena dozvola) combining temporary residence and work before starting employment in Serbia. The employer applies online through the government's single portal. The National Employment Service (NSZ), the public employment agency, checks the conditions within ten days, including a labour-market test that reports within four days whether suitable registered jobseekers exist, and confirms that the employer has not made the same role redundant in the previous 90 days. Separate permit types cover intra-company transfers of managers and specialists employed abroad for at least a year, special cases and self-employment.

Some foreigners may work without a permit, including family members of permit holders and certain short visits of up to 90 days in 180. Employment ends when the permit expires, and a fixed-term contract may run to the permit's expiry date. An employer that employs a foreigner without authorisation must still pay all wages, taxes and contributions, and employment is presumed to have lasted at least three months.