In Albania in 2026, an employee costs the employer the gross salary plus 16.7% contributions: 15% social insurance and 1.7% health insurance. The minimum wage of 50,000 lek costs 58,350 lek a month and 700,200 lek a year. Above 186,416 lek gross, social insurance no longer rises, so the addition falls below 16.7%.
We checked the rates on the employers’ page of the General Directorate of Taxes (DPT) and with the Social Insurance Institute (ISSH), and the rules on leave, overtime and medical certificates (sick leave) with the State Labour Inspectorate and ISSH. Contributions are the easy part, because they come from a formula. The real work is in the costs that do not show on the payroll list (the monthly payroll declaration): leave days that are paid without being worked, the first 14 days of a medical certificate and the supplements for hours outside the normal schedule. Before hiring, we would first calculate the annual cost and the cost per hour worked, not just the monthly salary.
Table: how much an employee costs per month and per year
The employer’s cost is the gross salary plus its own contributions. The employee’s contributions, 9.5% and 1.7%, are not added here, because they are withheld from the gross salary. The figures are in lek, for a full-time employee:
| Monthly gross salary | Employer contributions: social + health | Monthly cost | Annual cost (12 months) | Addition on top of gross |
|---|---|---|---|---|
| 50,000 (minimum wage) | 7,500 + 850 = 8,350 | 58,350 | 700,200 | 16.7% |
| 60,000 | 9,000 + 1,020 = 10,020 | 70,020 | 840,240 | 16.7% |
| 80,000 | 12,000 + 1,360 = 13,360 | 93,360 | 1,120,320 | 16.7% |
| 92,150 (average wage) | 15,389 | 107,539 | 1,290,468 | 16.7% |
| 100,000 | 15,000 + 1,700 = 16,700 | 116,700 | 1,400,400 | 16.7% |
| 150,000 | 22,500 + 2,550 = 25,050 | 175,050 | 2,100,600 | 16.7% |
| 186,416 (ceiling) | 27,962 + 3,169 = 31,131 | 217,547 | 2,610,564 | 16.7% |
| 250,000 | 27,962 + 4,250 = 32,212 | 282,212 | 3,386,544 | 12.9% |
The average gross wage in Albania was 92,150 lek in the second quarter of 2026, according to INSTAT (the Institute of Statistics); its contributions are rounded to the lek. To see what the employee receives net from these salaries, use the gross to net salary calculator.
How much the employer pays in social insurance in Albania
According to the DPT, the employer pays 15% social insurance and 1.7% health insurance on the gross salary, while 9.5% and 1.7% are withheld from the employee. The legal basis is Law no. 7703/1993 on social insurance and Law no. 10383/2011 on health insurance. ISSH adds that the employer pays over the whole amount, including the part it withholds from the employee’s salary.
For each employee, the calculation takes four steps:
- Take the monthly gross salary in the contract. According to the DPT, from 1 January 2026 the contribution base for employees starts at 50,000 lek, the minimum wage, and social insurance stops at 186,416 lek.
- Calculate the employer’s social insurance: 15% of the gross salary, but no more than 27,962 lek a month, which is 15% of the ceiling.
- Calculate the employer’s health insurance: 1.7% of the whole gross salary, with no ceiling.
- Add the two contributions to the gross salary. This is the monthly cost; multiplied by 12, it is the annual cost.
The payroll list with these contributions is declared by the 20th of the following month. You declare a new employee at least one calendar day before they start work. The ceiling only matters for high salaries: at 250,000 lek, the 63,584 lek above the ceiling carry no social insurance, so the addition falls to 12.9%. We explain how the contributions are split between the insurance branches, and the compensation for the minimum wage, in social and health contributions 2026.
Employee costs that do not show on the payroll list
The table above shows the cost of the salary. The Labour Code adds obligations that raise the cost per hour of work, even when the monthly salary does not change:
| Obligation | Legal minimum | How it affects the cost |
|---|---|---|
| Annual leave | no less than 22 working days a year | 52 weeks are paid, fewer are worked |
| Medical certificate (sick leave) | the employer pays the first 14 days, at least 80% of the salary | the salary is paid without work; from the 15th day ISSH pays |
| Overtime | a supplement of no less than 25% above the normal pay | an hour of overtime costs more than a normal hour |
| Sundays and public holidays | a supplement of no less than 25% | the same as overtime |
| Night work, 22:00-06:00 | a supplement of no less than 50% | night shifts cost more |
Normal working time is 8 hours a day and 40 hours a week, according to the State Labour Inspectorate. Every hour above this is overtime. For the overtime supplement, the collective agreement may provide otherwise.
From the 15th day of the medical certificate, social insurance pays 70% of the daily average for those with up to 10 years of insurance and 80% for those with more. The calculation is still done by the employer, according to ISSH.
Worked example: an employee on 80,000 lek gross
Let us assume a full-time employee, 40 hours a week, on a salary of 80,000 lek gross. We do not subtract public holidays, so the real cost per hour comes out slightly higher.
- Monthly cost: 80,000 + 12,000 (15% social insurance) + 1,360 (1.7% health insurance) = 93,360 lek.
- Annual cost: 93,360 x 12 = 1,120,320 lek. Of this, 160,320 lek are the employer’s contributions.
- Contract hours: 52 weeks x 40 hours = 2,080 hours a year, so 1,120,320 / 2,080 = about 539 lek per hour.
- Hours worked: without the 22 days of annual leave (22 x 8 = 176 hours), 2,080 - 176 = 1,904 hours remain, so 1,120,320 / 1,904 = about 588.4 lek per hour worked.
- Ten hours of overtime in a month: the hourly pay is 80,000 x 12 / 2,080 = about 461.5 lek. With the minimum 25% supplement, 10 hours of overtime cost about 5,769 lek gross, and with 16.7% contributions about 6,733 lek.
So a salary of 80,000 lek gross costs the business about 588 lek for every hour the employee actually works, not 461.5 lek, which is what the salary divided by the hours gives. The difference comes from the contributions and from paid leave. Every day of medical certificate within the first 14 days raises this figure further.
The recommended solution: the payroll list in devBooks
The devBooks human resources and payroll module keeps the employee register with departments and job positions, and calculates the payroll list with bonuses, deductions and the calendar of public holidays. You import employees, bonuses and deductions from Excel. With the posting schemes you configure, the payroll list goes into the accounts by itself. For human resources data, devBooks integrates with devHR. devBooks does not pay the contributions and does not apply for compensation: you or your accountant make the payment at the bank.
Sources
- DPT: Questions and answers on payroll lists
- DPT: “Nga 1 janari 2026, rritet paga minimale dhe maksimale” (From 1 January 2026, the minimum and maximum wage rise)
- ISSH: Compulsory insurance
- ISSH: Incapacity due to illness
- State Labour Inspectorate: How an employment contract is concluded (working hours, overtime, annual leave)
- State Labour Inspectorate: General obligations of the employer
- The Labour Code, updated 2024 (State Labour Inspectorate)
- INSTAT: Wage statistics, Q2 2026
- Salary deductions in Albania in 2026
- Social and health insurance contributions in Albania 2026
- Annual leave in Albania: how many days and how it is paid
To see how devBooks calculates the payroll list and the cost of your staff, see devBooks pricing or request a demo with your own data.