Changes To The Contract
Amendment to the employment contract may be initiated by either party, however both parties must agree for the contract to be amended. The employment contract is amended by conclusion of an annex in the same form as the employment contract.
Change In Ownership Of The Business
The change of ownership of the business, per se, does not have any impact on the employment of employees. The Labour Law does however provide some rules in events of statutory changes in the company such as mergers, divisions and acquisitions.
All rights, obligations and responsibilities under the employment and the employment contract are transferred to the new employer in cases of statutory changes, and the new employer is obliged to provide the employees such, for at least one year, that is, until the expiry of the employment contract or collective bargaining agreement which bind the previous employer.
In event of transfer of activities of the company or parts of the company or in case of transfer of tasks or part of them from the employer – target to employer - acquirer, the rights and obligations deriving from employment are completely transferred to the employer – acquirer. Regardless of the legal grounds for transfer and regardless whether ownership rights are transferred, the acquirer is responsible to continue acting as employer for a period not shorter than one year. Prior to transferring the rights and obligations under employment to the employer - acquirer, the target and the acquirer are obliged to previously inform and consult with the trade unions, in order to reach an agreement regarding:
- the determined or proposed date of transfer;
- the reasons for transfer;
- the legal, economic and social implications for the employees; and
- the anticipated measures connected to the employees.
In event of termination of a company due to division, the body which decides on the division will determine which of the newly established companies will undertake rights and obligations related to employment from the previous employer.
Social Security Contributions
Mandatory social insurance consists of contributions for:
- pension and disability insurance;
- mandatory fully funded pension insurance;
- years of service calculated with increased duration (for specific professions);
- health insurance; and
- insurance in the event of unemployment.
Mandatory social security contributions are paid by the employer on behalf of the employee when performing payment of monthly salary.
Contributions on salary for employees are calculated and paid on the following rates:
- 18,8% mandatory pension and disability insurance;
- 7,5% mandatory health insurance;
- 0,5% mandatory additional health insurance in case of injury at work and professional disease; and
- 1,2% contribution for insurance in the event of unemployment.
Social security contributions are calculated and paid on the net amount of salary paid to the employee in accordance with the employment contract. The minimum basis for calculation and payment of contributions cannot be less than 50% of the average salary paid per employee in the country, as announced in January of the current year by the State Statistics Office.
In addition to social security contribution, the employer calculates and pays personal income tax on the salary of the employee at the rate of 10%.
Accidents At Work
In event of accidents at work, the employer is obliged to inform the labour inspectorate, union representative and employee representative for health and safety at work, in writing and without delay, latest within 48 hours as of occurrence of the accident.
Discipline And Grievance
Breaches of work discipline and order may result in termination of employment with or without notice period depending on the degree of seriousness of the breach. General rules for termination are prescribed by the Labour Law and more detailed discipline procedures may be prescribed with the employer’s internal policies.
Grievance notice shall be provided by the employer to the employee in event of initiation of a procedure for termination of employment due to personal reasons of the employee. If the employee due to their behaviour, lack of knowledge or opportunities is not able to perform the contractual or other employment obligations the employment may be terminated. Prior to termination the employer will serve the employee a grievance notice stating which aspects should be improved by the employee in a provided period, to avoid termination of employment. The period of improvement cannot be shorter than 15 days as of receipt of the notice.
The Labour Law prescribes a general ban on harassment and sexual harassment and provides that harassment and sexual harassment constitutes discrimination. According to the law, any unwanted behaviour that aims at or constitutes violation of the dignity of the job candidate or employee, and which causes fear or creates hostile, humiliating or offensive behaviour shall be considered harassment. Sexual harassment, on the other hand, is defined as any verbal, non-verbal or physical behaviour of sexual nature that aims at or constitutes violation of the dignity of the job candidate or employee, and which causes fear or creates hostile, humiliating or offensive behaviour. The law goes further to define mobbing (psychological harassment in the workplace) as any negative repetitive behaviour of an individual or a group (in a period of at least six months) which constitutes violation of the dignity, integrity, reputation and honour of the employee, and causes fear or creates hostile, humiliating or offensive behaviour, which may aim at termination of employment or resignation. The specific procedure to be conducted in event of mobbing is prescribed by a special law which prescribes internal procedures to be taken before the employers as well as the right to court protection against mobbing.
The Labour Law prescribes a general ban on discrimination applicable to direct and indirect discrimination, which provides that the employer must not treat the job candidate or employee unequally on the basis of their racial or ethnic origin, skin colour, gender, age, health condition, disability, religious, political or other beliefs, membership in trade unions, national or social origin, family status, property situation, sexual orientation, or other personal circumstances. The ban on discrimination refers especially to:
- criteria and requirements for selection of candidates;
- access to all types and levels of professional training, retraining and upskilling;
- working conditions and rights arising out of employment, including equal pay;
- termination of the employment contract; and
- rights of the members of associations of employees and employers or any other professional organization, including the privileges resulting from such membership.
Women and men must be ensured equal opportunities and equal treatment in connection with:
- access to employment, including promotion and work-related vocational and professional training;
- working conditions;
- equal payment for equal work;
- occupational social security schemes;
- absence from work;
- working hours; and
- termination of the employment contract.
Compulsory Training Obligations
There are no compulsory training obligations.
If the work process demands so, the employer may organise training or further education of the employee. The employee and employer conclude a special agreement for the purposes of training and education.
Offsetting earnings may only be done if the employer has a claim due for payment towards the employee and the employee gives written consent. The employee cannot consent to offsetting earnings for claims prior to them becoming due.
Payments For Maternity And Disability Leave
Employees on maternity leave are entitled to remuneration in the amount of salary paid to the employee in the last twelve months prior to the start of the maternity leave. The remuneration is paid by the State Health Insurance Fund.
Employees on sick leave due to illness or injury are entitled to 70% of the amount of monthly salary for the first 15 days of absence and 90% for the days exceeding 15 days of absence, if remuneration is paid by the employer in accordance with law. The remuneration is paid by the employer for a period of up to 30 days, and if the absence lasts more than 30 days, the remuneration is paid by the State Health Insurance Fund for the time exceeding 30 days.
The employer may be obliged to pay remuneration for the days of absence exceeding 30 days, if determined by a labour inspector that the employee’s illness or injury was caused due to disregard of health and safety measures by the employer.
When establishing employment, the employer is obliged to register the employment with the Employment Agency and register the employee for compulsory social, pension and disability and insurance in event of unemployment. Insurance contributions are paid by the employer on behalf of the employee when performing payment of salary.
Absence For Military Or Public Service Duties
Employees are entitled to absence for military or public service duties. During the absence lasting less than six months, the employment rights and obligations are suspended, and the employer cannot terminate the employment. The employee is not entitled to salary during suspension of employment.
Works Councils or Trade Unions
Employees are free to become members of or incorporate trade unions. The trade unions on the level of an employer may become members of trade union associations at industry level or other associations.
The employee must not be put in less favourable position due to union membership, and in particular it is not allowed:
- to conclude an employment contract with any employee under the condition that the employee does not join the union, that is, under the condition that the employee withdraws from the union; and
- to terminate employment or put the employee in a less favourable position than the other employees in another manner, due to membership in the union or participation in union activities outside of working hours, or during working hours with employer’s consent.
The Labour Law offers special protection to elected union representatives in that they cannot be dismissed for performing union activities and their dismissal is conditioned by union consent and the amount of their salary must not be decreased without prior consent of the union. The protection against dismissal is applicable during time in office and two years after termination of their service as union representative.
The activity of a union may be banned by a court decision, if the union activity is determined to be in breach of the Constitution or applicable laws.
Employees’ Right To Strike
The trade unions and trade union associations are entitled to organise a strike to protect the rights of their members. The strike must be announced to the employer by written letter, which must contain the reasons for strike, place of holding the strike, and the date and time of starting the strike. The strike must be organized in such manner as to not disable or impede the organisation and performance of the working process for the employees which are not participating in the strike, nor to forbid entrance to employees and responsible persons into the employer’s premises. Prior to commencing the strike, the employer and union are obliged to attempt a reconciliation procedure, which on the other hand must not limit the right to strike.
On the employer’s proposal, the union and employer will consensually prepare and adopt rules on production maintenance and indispensable works which must not be stopped during a strike, which shall in particular contain provisions for works and number of employees who must cover those works during a strike, for the purpose of enabling continuation of the work process after termination of the strike termination and for the purpose of carrying out works which are necessary to prevent threat to life, personal safety or health of the citizens. The determination of indispensable works must not hinder or substantially restrict the right to strike.
The employer or employer’s association may demand the competent court to impose a ban on organising and conducting a strike, organised contrary to the provisions of the law. The employer will be entitled to claim compensation for damages suffered due to a strike organised and conducted contrary to the provisions of the Labour Law.
Employees On Strike
Consequences of the strike
Organising or participating in a strike, organised in accordance with law and collective agreement, does not constitute violation of the employment contract and the employee must not be put in less favourable position than other employees due to organisation or participation in a strike. The employee may be dismissed if they organised or participated in a strike contrary to provisions of the law and collective agreement, or if the employee committed another serious violation of the employment contract during the strike.
The employer may suspend from work not more than 2% of the entire number of employees participating in the strike, only as a response to an already initiated strike. Only employees who, by their conduct incite violent and undemocratic behaviour, as a consequence of which the negotiations between the employees and the employer are impeded, may be suspended from work. The trade union may demand the competent court to impose a ban on suspension from work during strike, if suspension is done contrary to the provisions of the law. The trade union may also claim damages suffered by the employees or the union due to the suspension from work during a strike.
Salary and Contributions
The organiser of the strike (union or association of unions) may pay net salary to the employees who participate in the strike, during the period of the strike, from its own funds.
During participation in a strike, the employer is obliged to pay contributions on the lowest basis for calculation and payment of contributions.
Freedom of choice
Employees must not in any way be forced to participate in a strike.
Employers’ Responsibility For Actions Of Their Employees
The employer is responsible for compensation of the damage caused by the employee to a third party, if damage was caused during the employment and in connection with the work, intentionally or by gross negligence.