Employer of Record in Libya

Businesses can only operate smoothly in Libya if they comply with local labor laws including drafting compliant employment contract agreements and meeting taxation and payroll obligations. Learn more about the employment laws and regulations in Libya below, to avoid any compliance issues.

Employment Contract Requirements

In Libya, employment contracts serve as legal agreements between employers and employees, outlining terms and conditions of employment. These contracts typically specify details such as:

• Job responsibilities
• Salary
• Working hours
• Leave entitlements
• Termination procedures

Onboarding Process

We can help you get a new employee started in Libya quickly, with a minimum onboarding time of just 1-2 working days. The timeline starts once the employee submits all required information onto the Playroll platform and completes any necessary local authority registrations. For non-nationals, the Right to Work assessment (if applicable) may add up to three extra days. Additional time may be needed for follow-ups on this assessment. Please note, payroll cut-off dates can impact the actual start date. Playroll's payroll cut-off date is the 10th of each month unless otherwise specified.

Working Hours in Libya

In Libya, the standard working week typically consists of five days, from Sunday to Thursday. Typical working hours within Libya are 48 hours per week, 10 hours per day.

Overtime in Libya

Any work exceeding the standard 48 hours per week falls under the category of overtime and is governed by the employment contract or collective agreements. Generally, overtime limits are capped at 3 hours per day and compensated at 150% of the standard salary rate.

Probation Period in Libya

The probation period in Libya is typically six months.

Hiring in Libya means navigating local labor laws, mandatory employee benefits, payroll taxes, and strict employment regulations. These requirements aren’t always intuitive, especially if your team lacks in-country legal or HR expertise. An Employer of Record steps in as the legal employer for your hires, managing all compliance-related responsibilities. This includes issuing locally compliant contracts, registering employees with relevant authorities, processing payroll, and handling social security contributions and taxes in line with national laws.

By handing over these complexities to an EOR, your business avoids costly compliance errors and the time required to master local employment standards. You can focus on growing your team and operations while trusting that the legal and administrative foundation is solid. Whether you're making one strategic hire or building out an entire team, the EOR keeps you compliant, removes guesswork, and reduces the risk of legal or financial penalties, without requiring you to open a legal entity or maintain a local HR team.

Fiscal Year in Libya

1 January- 31 December is the 12-month accounting period that businesses in Libya use for financial and tax reporting purposes.

Payroll Cycle in Libya

The payroll cycle in Libya is usually monthly, with employees being paid towards the end of the month.

Minimum Wage in Libya

As of January 1, 2025, Libya does not have a statutory minimum wage. Wages are generally determined by individual employers and are subject to market conditions and collective bargaining agreements in certain sectors.

Bonus Payments in Libya

There are no provisions in the law for a 13th-month salary in Libya.

Employer Tax Contributions

Employer payroll contributions are generally estimated at an additional 10.5% on top of the employee salary in Libya.

Employee Payroll Tax Contributions

In Libya , the typical estimation for employee payroll contributions cost is around 4.75%.

Individual Income Tax Contributions

Individual income tax in Libya is progressive, with rates ranging from 5% to 10%.

Pension in Libya

In Libya, there is a public pension system that provides retirement benefits to eligible individuals. The pension system is managed by the government and provides financial support to retirees. Additionally, there may be private pension options available through employers or individual savings plans.

Running payroll in Libya is complex, especially when you're hiring without a local entity. Local laws determine everything from tax withholdings and reporting deadlines to benefit contributions and currency requirements. Missteps can lead to fines, payment delays, or unhappy employees. An Employer of Record takes this burden off your plate by handling the full payroll process. Acting as the legal employer, the EOR ensures you remain compliant with all payroll-related obligations, while still allowing you to manage your team’s day-to-day work and performance.

Key Ways an EOR Supports Payroll in Libya:

• Compliance Assurance: Ensures payroll aligns with local tax laws, labor regulations, and statutory deadlines.
• Payroll Processing & Tax Management: Calculates salaries, applies correct tax withholdings, and submits required reports.
• Benefits & Social Security Contributions: Manages employer obligations for pensions, health insurance, and other legal entitlements.
• Contract Generation & HR Administration: Drafts compliant employment contracts and supports onboarding, terminations, and HR tasks.
• Currency Payments: Issues timely salary payments in local currency, ensuring employees are paid accurately and on time.

In Libya, work permits and visas are essential for employers hiring foreign workers. The process involves submitting applications, paying fees, and meeting specific eligibility criteria. The key visa types include the Temporary Work Visa, designed for short-term employment; the Long-Term Work Visa, suitable for extended contracts; and the Skilled Worker Visa, targeting professionals with specialized expertise. Employers must act as sponsors, initiating the application process and ensuring compliance with Libyan labor laws. Processing times can range from weeks to months, and fees vary by visa type and duration. While Libya does not currently offer a specific visa for digital nomads, remote workers may explore existing business or work visa options. Employers should be prepared to address challenges such as legal complexities, cultural differences, and security concerns when hiring foreign employees in Libya.

Mandatory Leave Entitlement in Libya

The annual leave entitlement in Libya is 30 days for a full time worker. These can include public holidays on top of that or within those days, which would otherwise be unpaid.

Public Holidays In Libya

In Libya, public holidays may include:

Paid Time Off in Libya

The minimum entitlement to paid annual leave under Libyan Labor Law is 30 working days, which increases to 45 working days for those over the age of 50 years or who have attained 20 years' service.

Maternity Leave In Libya

Under Libyan Labor Law, female employees are entitled to 14 weeks of paid maternity leave, which includes a mandatory leave period of not less than six weeks following delivery.

Paternity Leave In Libya

Libya's labor laws do not provide statutory paternity leave for fathers, though employers may offer paternity leave as part of their company policies or employment contracts.

Sick Leave In Libya

In Libya, workers are entitled to paid sick leave or salary for a maximum of 45 continuous days, or 60 days if not continuous, within a year. However, regardless of the arrangement, sick leave should not exceed 3 months annually.

Parental Leave In Libya

Libya's labor laws do not provide a statutory shared parental leave policy that allows parents to divide a set amount of leave between them.

Administering employee benefits in Libya requires more than just offering a standard package. Local labor laws often mandate specific entitlements, from health insurance to paid leave, and the rules can change without warning. Libya also has unique standards for what an attractive, competitive benefits package looks like. For businesses without in-country expertise, meeting these obligations and expectations can quickly become risky and expensive. An Employer of Record acts as your compliance partner, ensuring all benefits are provided according to the latest legal requirements and without administrative strain on your internal team.

Beyond compliance, an EOR brings clarity and consistency to a process that’s often complex and fragmented. They handle enrollments, ensure accurate employer contributions, manage communications with local providers, and keep everything properly documented. This means employees get what they’re entitled to, and you avoid the headache of navigating benefits systems in a foreign market. Whether you're hiring one person or building a larger team, an EOR provides a clear, dependable structure that lets you offer competitive benefits without taking on unnecessary risk or workload.

Termination Process in Libya

Employers can terminate an employment agreement for the following reasons:

• Expiration of a contract
• Medical reasons that would prevent the employee from fulfilling their duties.
• Conviction of a crime
• For termination initiated by either the employee or employer- a letter of resignation or termination must be sent to the other party.

Notice Period in Libya

The notice period in Libya is typically 30 days for both the employee and employer.

Severance in Libya

In Libya, severance pay is not required for Libyan nationals, but it is for expatriates. Expatriates are entitled to receive half a year's salary for every year of employment, up to a maximum of five years.