Foreign investors establishing businesses in Albania often ask what employment laws apply to foreign-owned companies. Albanian labor law applies equally to all employers operating in the country, regardless of whether the company is owned by Albanian or foreign nationals.
Foreign-owned companies must comply with the Albanian Labor Code, which governs employment relationships, workers’ rights, employer obligations, and dispute resolution.
Key Legal Obligations
Every company operating in Albania must sign a written employment contract with each employee. The contract must specify working hours, salary, job duties, probation periods, and other required terms. Verbal contracts are not sufficient under Albanian law.
Foreign-owned companies must register all employment contracts with the General Directorate of Taxes and the Social Insurance Institute to ensure compliance with payroll tax and social contribution obligations. Employers are responsible for withholding and paying income tax, social security, and health insurance contributions for employees.
Employment contracts in Albania can be for an indefinite or fixed term. Fixed-term contracts must comply with specific rules about renewals and duration limits.
Equal Treatment and Worker Protections
Albanian employment laws prohibit discrimination in hiring, promotion, and termination based on nationality, gender, age, or other protected characteristics. Foreign-owned companies must provide the same rights and protections to employees as any domestic company, including entitlements to annual leave, sick leave, maternity leave, and severance where applicable.
Termination of employment must follow legal notice periods and grounds for dismissal under the Labor Code. Wrongful termination can lead to court-ordered compensation or reinstatement.
Hiring Foreign Employees
Foreign-owned companies may hire foreign nationals to work in Albania, but foreign employees must obtain a residence permit with work rights or a work permit depending on their nationality and job role. The employer must support this process by providing employment documentation required for permit applications.
Employment laws in Albania for foreign-owned companies require full compliance with the Albanian Labor Code, including written contracts, payroll registration, social security contributions, and worker protections.