Employment in Monaco is governed by the Principality's own labour laws, including Law No. 729 on employment contracts, which was substantially updated by Law No. 1.583 of December 2025. Every hire needs prior authorisation and a work permit, and pay follows the French minimum wage plus a 5% Monaco allowance. Here is what employers need to know about leave, pay, tax and ending employment.
Annual leave is governed by Law No. 619 of 1956. Leave is counted in working days (Monday to Saturday), and part-time employees earn the same number of days as full-time staff.
2.5 working days per month of work, up to 30 working days (5 weeks) a year. The reference period runs from 1 May to 30 April.
8 weeks before and 10 weeks after birth for a first or second child, rising to 26 weeks from the third child. Longer for multiple births.
Consecutive calendar days, or 28 days for multiple births or where there are already 2 dependent children. Taken within 4 months of the birth.
The contract is suspended, not ended, for up to 6 months of medically certified illness or accident. Daily allowances come from social security.
Both are paid through daily allowances from the Caisses Sociales de Monaco rather than by the employer. Up to 4 weeks of prenatal maternity leave can be moved to after the birth with medical approval. An employee cannot be dismissed during pregnancy, maternity or paternity leave, or for 4 weeks afterwards, except for serious misconduct unrelated to the pregnancy or birth, business closure or the end of a fixed-term contract. Fathers must give 2 weeks’ notice by registered letter before paternity leave.
These days are paid and count as time worked for annual leave. Collective agreements may give more.
Set up each Monaco leave type in IceHrm with its own accrual, carry forward and approval rules, including the 1 May leave year and seniority days. Employees see their live balance before they apply, and managers see who is away on a shared calendar. Leave management →
Monaco’s minimum wage follows the French SMIC (the “neighbouring economic region”), which the Government confirms by circular after each French increase. Minimum rates must then be increased by a mandatory 5% exceptional allowance, which is not subject to social contributions.
The French SMIC since June 2026, or about €2,080 for 169 hours a month (39 hours a week). Plus the 5% Monaco allowance.
Of actual work, with a maximum of 10 hours a day.
And no more than 46 hours on average over any 12 consecutive weeks. Up to 60 hours only in exceptional cases with Labour Inspectorate approval.
| Overtime hours in the week | Premium |
|---|---|
| First 8 hours (40th to 47th hour) | 25% |
| Beyond 8 hours | 50% |
Capture attendance and overtime in IceHrm and feed the hours straight into payroll, so the 25% and 50% overtime premiums reflect what was actually worked. Time & attendance →
Monaco does not levy personal income tax on salaries, so employers do not withhold income tax from pay.
Because most staff live outside the Principality, employers should expect questions about home-country tax. Employees should take advice on their own situation.
Contributions are declared and paid to the Caisses Sociales de Monaco by the 10th of the following month. The rates below have applied since 1 October 2025 (unemployment insurance since 1 January 2026), and each is charged up to its own monthly ceiling.
| Contribution | Employer | Employee | Monthly ceiling |
|---|---|---|---|
| CCSS (incl. occupational health) | 13.40% | – | €9,800 |
| CAR basic pension | 8.33% | 6.85% | €6,112 |
| Unemployment insurance | 4.00% | 2.40% | €16,020 |
| CMRC pension, band A | 6.01% | 4.01% | €3,971 |
| CMRC pension, band B | 14.57% | 9.72% | 8× band A |
CMRC shares are 60/40 of the total band rates (10.02% for band A, 24.29% for band B). Late payment attracts interest of 1% a month plus a 10% surcharge.
Build Monaco pay the way you already structure it, with your own salary components, deductions and formula columns, such as the 5% allowance or a CAR contribution column. Want to know how well IceHrm handles payroll calculations for Monaco? Contact us or see Payroll →
Either party can end an open-ended contract by giving notice, but a dismissal without a valid reason entitles the employee to a statutory dismissal indemnity, and an abusive dismissal can lead to damages set by the Labour Court. Since Law No. 1.583 of December 2025, employers and employees can also agree a rupture conventionnelle, which must be approved by the Labour Inspectorate.
| Uninterrupted service | Notice |
|---|---|
| More than 6 months | 1 month |
| More than 2 years | 2 months |
| More than 2 years, managers (cadres) | 3 months |
During notice, employees can take 12 hours a week off to look for a new job, paid unless they resigned.
| Indemnity | When it is due | Amount |
|---|---|---|
| Severance indemnity (indemnité de congédiement) | Dismissal after 2 years’ uninterrupted service | At least what employees in the same trade receive in the neighbouring French region |
| Dismissal indemnity (indemnité de licenciement) | Dismissal without a valid reason | 1 day’s salary for each month of service |
Final pay includes any unused annual leave. Failing to give the full notice period means paying the salary and benefits the employee would have received during it.
Monaco has 12 legal public holidays, set by Law No. 798 of 1966. All are paid days off.
When New Year’s Day, 1 May, 15 August, 1 November, 19 November or Christmas falls on a Sunday, the following Monday is a holiday. Employees who work on a public holiday receive their normal pay plus an equal amount or a paid day off in lieu, and a holiday during annual leave is not counted as leave.
Leave groups give each office its own holiday calendar, so staff in Monaco get Sainte Dévote and National Day while colleagues in France or Italy follow their own public holidays. Holiday calendars →
Every hire in Monaco needs prior approval. A contract is only valid once the hiring authorisation and work permit have been obtained, and it ends automatically if the work permit is later withdrawn or refused.
A probation period must be written into the contract or the hiring application; it is not presumed. If the contract or collective agreement does not set its length, it is 1 month for monthly paid staff. It can be renewed once with the employee’s written agreement, but the total can never exceed 3 months. Either party can end the contract during probation without notice or indemnity. Fixed-term contracts can only be ended early for just cause, serious misconduct, force majeure or cases set out in the contract.
Store work permits and contracts on each employee’s record, send documents for e-signing, and track onboarding with task lists so nothing is missed before day one. Documents & e-signing →
This guide is general information to help you plan HR processes, not legal, tax or financial advice. Employment law and rates change regularly and awards, enterprise agreements and state rules may give employees more than the minimums shown here. Always confirm current requirements with the official sources or a qualified adviser.
Configure leave types, accrual rules and public holidays for Monaco, keep employee records and contracts in one place, and run payroll with your own salary components. Want to know how IceHrm handles payroll calculations for Monaco? Talk to us.
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