Introduction

When expanding your business internationally, understanding local labour laws isn’t just a compliance task - it’s essential for sustainable growth and reputational protection. For organisations operating between San Marino and the United States, the legal differences can be striking. While the US is known for its relatively flexible employment laws, San Marino - a microstate nestled within Italy - follows a far more protective, European-style labour framework.

If your business is navigating talent management, payroll, or contracts across these two countries, this comparison will help you avoid common pitfalls and set up your people processes with confidence.

Quick Tips

• San Marino employment contracts must be written and registered with local authorities.

• 'At-will' employment doesn’t exist in San Marino - terminations must be justified and follow strict procedure.

• Employee rights to paid holiday, maternity leave, and sick leave are more generous in San Marino than in most US states.

• Social security contributions are mandatory in both countries but calculated differently.

• Unionisation and collective bargaining are embedded in San Marino's labour relations - be prepared for more formal negotiations.

Employment Contracts: Standard vs Structured

In the US, employment is often 'at-will' - allowing either party to terminate the relationship without cause (subject to discrimination laws). Contracts, if issued, are typically short and may not outline detailed rights unless required by state law.

In contrast, San Marino requires formal, written contracts that must be registered with the Labour Office. These contracts include specific job roles, working hours, salary details, and termination clauses. Fixed-term contracts are limited and must meet justifiable conditions. Failure to meet these standards can invalidate the contract and create legal risk.

HR professionals must avoid assuming the flexibility of US practices translates abroad. If you're expanding into San Marino, invest in local legal review of all documentation.

Working Time, Leave and Benefits: European Rigour

In San Marino, employees are entitled to:

• A minimum of four weeks’ paid annual leave

• Up to 20 weeks’ maternity leave at 80% pay

• Sick leave with doctor certification, covered by social security

The US, by contrast, has no statutory requirement for paid annual leave or maternity pay at the federal level - these are employer-dependent. The Family and Medical Leave Act (FMLA) provides up to 12 weeks’ unpaid leave for eligible employees, but it doesn’t apply to all workers.

This difference isn’t just technical - it shapes employee expectations. A US-based HR strategy may undervalue leave policies when hiring in San Marino, resulting in poor engagement or difficulty retaining talent.

Termination and Union Relations: Process vs Discretion

In San Marino, dismissals require a valid reason (economic or disciplinary) and documentation. Unfair dismissal can lead to reinstatement or compensation. Union representation is common, and employers must respect collective bargaining agreements.

In the US, provided there is no discrimination or breach of contract, terminations can be actioned with minimal legal risk. Union coverage is less widespread, especially in the private sector.

When managing people across both countries, it's crucial to align expectations - not just policies. A dismissal process that seems straightforward in the US may cause reputational or legal issues in San Marino without proper documentation and consultation.

A Real Example: Avoiding Missteps Across Borders

Last year, I supported a client headquartered in Texas who was expanding into Europe. They hired a small team in San Marino and copied their US onboarding process. Within months, a terminated employee in San Marino challenged the dismissal - the contract had not been properly registered, and the reasoning was not sufficiently documented. The company faced reputational damage and had to pay compensation.

We worked with local counsel to revise their employment templates, build a compliant onboarding and termination procedure, and train their global managers on cross-border differences. They’ve since grown their presence successfully without further issues.

Final Thoughts

Labour law is never just paperwork - it reflects culture, values, and social expectations. What works in Dallas doesn’t necessarily translate to San Marino. But with the right advice, you can navigate both systems effectively and ethically.

What’s next for your global people strategy?

Book a free compliance check-in or HR audit with ThinkGlobal HR. We’ll help you assess risks, update contracts, and build people systems that scale across borders - with confidence and care.