Independent Contractor Hiring Guide: Greece

# Independent Contractor Hiring Guide: Greece Greece has become an attractive destination of firms that are interested in top-quality talent in the Mediterranean. The country also has a limitless value proposition, with a fast digitizing economy and workforce that has become technologically oriented and specialized in engineering and creative services. Nonetheless, in the case of international businesses, it is infamously difficult to manoeuvre within the Greek legal system. Contractors hiring in Greece involves a fine line of walking between legal compliance and expediency. The Greek government has enacted major labor reforms as of 2024 and 2025, such as Law 5239/2025 which is meant to modernize the labor force, yet it also introduces more severe scrutiny as per worker classification. This guide is a breakdown of the things that an organization wants to do to attract Greek talent that will not go against the law and will be effective. ## Hiring Contractors in Greece You have decided to begin to hire contractors in Greece, and this brings you to a professional environment in which there are two different sets of law: the Labor Code (employees) and the Civil Code (independent contractors). The most crucial aspect of your strategy to expand into Greece is ignoring the subtleties between these two. ### Independent Contractors vs. Full-Time Employees In Greece, an independent contractor is often referred to as an Eleftheros Epaggelmatias (freelancer) or a self-employed professional. They are independent business organizations * Subordination: This is the most important legal test applied by the Greek courts. Provided that a worker is under your control in terms of the time of work, location and conditions under which they work then chances are that they are an employee. Contractors have to be left to determine the method and time of doing the work. * Legal Framework: Workers are safeguarded by the Law 4808/2021, and the new Labor Law 5239/2025, which require minimum wages, 13 th and 14 th month wages and rigid termination conditions. Contractors on the other hand are subject to a Service Agreement in the Civil Code. * Tax and Social Security: In the case of the employers, the income tax and contributions to EFKA (social security) are to be withheld by the employer (approximately, 21.79% employer contribution in 2025). In the case of contractors, the person is in charge of his/her payment of EFKA as well as tax returns. ### Penalties for Misclassification The Greek Labor Inspectorate (SEPE) is very active. Misclassification Misclassification, paying an employee as a contractor to not subject him to social security and benefits, is locally referred to as disguised employment. If a contractor is reclassified as an employee, the penalties include: * Administrative Fines: A standard fine of €10,500 per undeclared worker. * Retroactive Payments: You will get repayment of all the unpaid social security contributions (EFKA) through the relationship along with interest and late penalty. * Back-Pay: The employee can demand 13th and 14th month bonuses, vacation allowances and severance that are not paid. * Legal Costs: Cases in the Greek labor courts are common and the case usually goes in favor of the worker in case subordination has been established. ## Challenges of Hiring Contractors in Greece While the benefits of hiring independent contractors in Greece are significant, several hurdles can complicate the process for uninitiated HR managers. ### 1. Misclassification Risks and the "9-Month Rule" Greek law has a certain rebuttable presumption. In case a person offers his services to a single or main customer during a period of nine months without a break, it can be assumed that the relation will be considered to be that of dependent employment. To address this, the contracts are to be clearly designed to conform to project milestones, and not the daily availability. ### 2. Greece Payroll Requirements Although you may not be operating a conventional contractor payroll system, the Greek invoicing system has to be negotiated. The contractors are required to provide a Service Receipt (Deltio Parochis Ypresion) via the AADE (Independent Authority on Public Revenue) digital platform called myDATA. * VAT (FPA): The average VAT rate in Greece stands at 24%. This will be included in your invoices unless the contractor qualifies on an exemption (generally through very low turnover). * Withholding Tax: In the case of some professional services, the Greek companies usually have to pay income tax immediately at the source amounting to 20%. In the case with international firms that have no local organization, this need differs and it would be important to hire expertise or use a platform. ### 3. Hiring Issues: Bureaucracy and Talent Scarcity What used to be referred to as a brain drain by the Greek has turned into a brain gain, however, the discovery of senior talent has had to traverse a market where local talent will tend to take B2B contracts to maximize their take home pay. Nevertheless, the administrative load on the contractor (EFKA registration, AFM/Tax ID obtained) may act as an obstacle in the transition of the employees to freelance. ## How to Hire Independent Contractors in Greece This is a 3-step process that, when followed, will help in hiring independent contractors in Greece successfully. ### 1. Carefully Conduct Interviews When interviewing Greek contractors, your focus should be on their technical autonomy. * Verify Business Status: Inquire whether they are registered or not with EFKA, whether they have an active AFM ( Tax ID ). * Assess Equipment: They should have their own tools of the trade. In Greece, giving out a company laptop to an employee who is a contractor is a huge warning to the labor inspectors. * Cultural Fit: Greek professionals value clear communication and personal rapport. But keep professional distance in the interview so as to underline the B2B character of the relationship. ### 2. Create a Service Agreement A verbal agreement is never sufficient. Your written Service Agreement should include: * Scope of Work: Spell out any particular deliverables as opposed to general duties. * Independence Clause: Clearly stipulate that the contractor is not an employee and he/she is ineligible to company benefits. * Intellectual Property (IP): According to Greek jurisdiction, the right to moral rights to work is frequently retained by the creator unless a strong clause on intellectual property transfer is inculcated in the contract. * Notice Period: Spell out how the contract may be ended by either party (see "Terminating" section below). ### 3. Introduce Necessities Bringing on board a contractor is not the same as an employee. Rather than a Welcome to the Team handbook, a Project Guide. * Communication Channels: Set up Slack or Teams access restricted to project-relevant channels. * Security Protocols: Make sure that the contractor complies with GDPR that is strictly followed in Greece. * Reporting: Determine how they will control their progress (e.g. weekly progress reports) without them supervising day-to-day operations. ## How to Pay Independent Contractors in Greece Payments to Greek contractors are typically made in Euros (EUR). * The Invoicing Cycle: The contractor is required to post his or her invoice on the myDATA system. This is a legal obligation that they should be tax-compliant with. * Payment Methods: * International Bank Transfer (SEPA): EU-based companies are relatively safe and relatively fast. * Digital Wallets: Digital wallets are not a new concept as there are some Greek banks that impose high-incoming wire charges. * Centralized Platforms: With a platform such as Mellow, the company can easily have all the contractor payments availed to them on one invoice whilst the contractor has the local invoicing needs met. | Tax Type | Rate (Approx.) | Responsibility | | --- | --- | --- | | VAT (FPA) | 24% | Contractor (Added to invoice) | | Withholding Tax | 20% | Employer (if local entity) | | EFKA | Varies by tier | Contractor | ## Terminating Independent Contractors Termination is one of the main reasons why contractors are hired in Greece because it is easy to terminate the contract than the Labor Code that is rigid. * Employment Termination: It is mandatory and needs a written notice, registration under the ERGANI system within 4 days and obligatory severance payment when the working period of the employee is more than one year old. * Contractor Termination: Abides by your Service Agreement. In case the contract is at-will or there is the provision of 15 days of notice, you can terminate the relationship by simply written notifying. * Risk Mitigation: Do not dismiss a contractor in a manner that would seem like we are punishing a worker. Employ neutral language that emphasizes the achievement of project requirements that will not furnish grounds towards a misclassification claim. ## Using Platforms for Hiring Contractors Navigating the nuances of Greek tax, EFKA, and myDATA can be an operational nightmare for a small company. This is where specialized platforms become indispensable. * Mellow.io: For companies looking for a "Contractor of Record" (CoR) approach, Mellow offers a robust solution. Mellow is the mediator, which guarantees that the relationship is recorded as a valid B2B deal. It takes care of the duty to collect tax compliant invoices, transfers of IP rights and lets you pay your whole Greek team at a single button press. This significantly reduces the risk and frees your HR team from Greek bureaucracy. * LinkedIn & Local Boards: These are good places to obtain talent however they do not provide any compliance warranty. * Worksuite/Deel: These are options that are more global, but Mellow has greater flexibility of localized contracting, and thus many agile teams in the area would prefer to use Mellow. ## Conclusion Hiring contractors in Greece offers an incredible opportunity to scale your business with Mediterranean talent. Nevertheless, misclassification and social security are legal landmines that lie on the way. Following the principles of the principle of independence strictly, writing Professional Service Agreements in accordance with the order of the Civil Code, and turning to the services of such modern compliance platforms as Mellow, you will be able to have the advantages of the flexible workforce, without legal nightmares. Since the Labor Law Code (P.D. 62/2025) is still unifying the Greek regulations, only by keeping up-to-date and employing the appropriate tools are you guaranteed to make your expansion successful and lawful.