As the summer holiday season approaches, many private-sector employees in Greece are preparing to take their annual leave and receive the holiday allowance that accompanies it.

Under Greek labor law, employees are entitled not only to paid vacation leave but also to a separate holiday allowance. The legislation clearly defines how both payments are calculated, the applicable limits and when they must be paid.

What Counts as Holiday Pay?

When employees take annual leave, they are entitled to receive their usual earnings for the period they are absent from work. In practice, this means they should receive the same remuneration they would have earned had they continued working normally.

The calculation includes all regular and permanent forms of compensation linked to employment, including:

• Pay for regular work performed on Sundays, public holidays or during night shifts.
• Compensation for overtime worked on a regular basis.
• Payment for legally authorized overtime that the employee would normally have performed during the leave period.

However, compensation for unauthorized overtime and the proportional share of holiday bonuses are not included in the calculation.

How the Holiday Allowance Is Calculated

In addition to their vacation pay, employees are entitled to a holiday allowance, which is calculated using the same principles as annual leave pay.

The law sets maximum limits on the amount that can be paid:

• Employees paid a monthly salary can receive up to half of their monthly wage as a holiday allowance.
• Employees paid by the day, hour or commission can receive up to 13 daily wages.

When Must the Payment Be Made?

Greek labor regulations require employers to pay both the annual leave remuneration and the holiday allowance in advance, at the start of the employee’s vacation.

Employees also have the right to request the period during which they wish to take their annual leave. Once such a request is submitted, the employer must respond and grant the leave within two months.

What Happens if Employment Ends?

If an employment relationship ends before an employee has taken the leave they are entitled to—whether through resignation or dismissal—the employer remains obligated to pay the amount corresponding to the unused leave.

The employee must receive the compensation they would have been entitled to had they taken the leave before the termination of employment.