Andorra EOR & PEO
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DID YOU KNOW
- Andorra is one of the smallest countries in Europe, nestled in the Pyrenees mountains between France and Spain.
- Andorra has no airport or railway, making it one of the few countries only accessible by road.
- The country has one of the highest life expectancies in the world and offers a high standard of living in a safe, clean environment.
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Working in Andorra
Financial Year Dates
Andorra’s financial year runs from the 1st January to 31st December.
Minimum Wage
As of 2025, the minimum wage in Andorra is €1,326.53 per month based on full-time employment.
Standard working hours
The standard workweek in Andorra is 40 hours, commonly split into five 8-hour days. Standard working hours are from 9 AM to 6 PM, often with a two-hour lunch break in line with Southern European norms.
Overtime
Overtime is regulated by employment contracts or collective agreements. In general, overtime is compensated at a rate of 125% of the standard salary. Employers must not exceed 8 hours of overtime per week unless formally agreed upon.
Holiday Allowance
Employees are entitled to a minimum of 30 calendar days (equivalent to around 22 working days) of paid annual leave. This is in addition to public holidays.
Sick Leave
Employees are entitled to sick leave, certified by a medical professional. Compensation depends on the duration of illness:
- Days 1–3: unpaid (though some employers may offer pay)
- From Day 4 to Day 90: paid at 66% of the employee’s base salary
- Beyond Day 90: paid at 50%, covered by the CASS (Andorra’s social security system)
Maternity & Paternity Leave
- Maternity Leave: 16 weeks (paid at 100% of the mother’s salary by CASS).
- Paternity Leave: 2 weeks (also paid via CASS).
Employees must contribute to social security for a minimum qualifying period to receive full benefits.
Public Holiday
Andorra observes 14 public holidays:
- New Year’s Day
- Epiphany
- Andorra’s National Day
- Good Friday
- Easter Monday
- Labour Day
- Assumption Day
- National Day (Our Lady of Meritxell)
- All Saints’ Day
- Immaculate conception
- Christmas Day
- St Stephen’s Day
- New Year’s Eve
Some holidays vary by parish and are recognized locally.
Social Contributions
Both employers and employees contribute to Andorra’s social security system (CASS), which funds healthcare, pensions, maternity/paternity leave, and sick pay.
Employers:
- Social Security Contributions: 5% of gross salary
Employees:
- Social Security Contributions: 5% of gross salary
These contributions are deducted at source and managed via payroll.
Income Tax
Andorra has a low, flat-rate personal income tax system, making it attractive for expatriates and businesses.
- The personal income tax rate is 10%, with a €24,000 exemption on employment income.
- Income between €24,001 and €40,000 is taxed at 5%.
- Income above €40,000 is taxed at 10%.
Residents are taxed on worldwide income, while non-residents are only taxed on Andorran-sourced income.
Health Care
Andorra operates a co-payment healthcare system funded by mandatory CASS contributions. It offers high-quality care with partial state coverage:
- Outpatient services: 75% reimbursed
- Hospitalization: 90–100% reimbursed
- Work accidents and maternity: 100%
Most employees also opt for complementary private insurance to cover any remaining out-of-pocket costs. Employers are not legally required to provide additional private healthcare, though it may be included as a benefit in some industries.
Visas
Although Andorra is not part of the EU or Schengen Zone, it maintains agreements with both Spain and France. Immigration is regulated separately from those blocs.
Work Visa
Foreign nationals must obtain a residence and work permit, typically sponsored by the employer. These permits are limited and subject to annual quotas. Applicants must also secure accommodation in Andorra and meet minimum income thresholds.
Temporary Residence
Available for individuals not engaging in gainful activity (passive residents), subject to investment requirements and a minimum stay of 90 days per year.
Family Reunification
Permits are available for dependents of legal residents, provided financial and accommodation criteria are met.
Note: Entry into Andorra requires prior Schengen Zone access (i.e., via France or Spain).
13th salary
There is no legal requirement for a 13th salary in Andorra. However, some employers offer performance-based bonuses or Christmas bonuses, especially in the retail and tourism sectors.
Cultural Information
- Andorra offers a unique blend of Catalan, French, and Spanish influences, resulting in a diverse cultural landscape. The official language is Catalan, but Spanish and French are also widely spoken, making it accessible for international talent.
- Traditional dishes include trinxat (cabbage and potatoes), escudella (meat stew), and crema andorrana, a local take on crème brûlée.
- Andorrans value punctuality, personal space, and modesty in professional settings. Business attire is typically formal, and personal introductions are respectful and concise.
By choosing Gibson Watts Global as your Employer of Record (EOR) in Andorra, you gain a strategic partner with the local expertise and infrastructure to help your business grow—efficiently, compliantly, and without borders. Let us take care of employment and regulatory challenges while you tap into Andorra’s uniquely stable and attractive business landscape.