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New Legislative Changes Promote Flexicurity in Employment Relations in Romania

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August 2023 – The first part of 2023 continued last year's trend of substantial changes to Romanian labour legislation, which is of real interest to both employers and employees. As such, both Law no. 53/2003 on the Labour Code (“Labour Code”) and Law no. 367/2022 on social dialogue (“Law on Social Dialogue”) have undergone several changes, some aimed at clarifying legal issues identified in practice and others at promoting flexibility at work and work-life balance.

In this article, we present the latest legislative changes, as well as our recommendations for their implementation.

I. Amendments to the Labour Code

The latest legislative amendments continue the European and national policies implemented in recent years that both encourage and enhance work-life balance.

While such amendments are welcome for employees, they may also pose certain challenges for employers.

1. Additional work from home days for employees with children

Who will benefit?

As of 24 July 2023, Law no. 241/2023[1] introduced more flexibility in the schedule of employees with children under 11 years old in their care.

What does it mean?

At their request, employees with children under 11 years in their care old may benefit from 4 days/month of work from home/teleworking[2], provided that the nature or type of work permits these employees to carry out their activity as such.

Limitations

To benefit from the above, employees must have at their disposal all the means necessary to carry out the duties assigned to them under the job description.

If both parents/caregivers are employees, only one of them may request the above benefit for the simultaneous period.

As such, the employee requesting the days of work from home/teleworking, must submit a statement from the other parent/caregiver (also an employee) mentioning that they did not request the same benefit for the same period.

Our recommendations

We recommend employers to update their internal regulations in order to reflect this new right of employees and to establish a clear procedure for granting this facility in a non-discriminatory manner.

2. New possibility of suspension of the individual employment agreement at the initiative of the employee

In which cases does it apply?

As of 29 May 2023, Law no. 140/2023[3] introduced a new case of suspension of the individual employment agreement at the initiative of the employee, namely, if such employee has concluded an agreement in accordance with the applicable legislation to perform any of the following activities:

  • foster carer;
  • personal assistant to a severely disabled person; or
  • professional personal assistant.

Potential future challenges

As opposed to other cases of suspension of the individual employment agreement at the initiative of the employee, the above case may bring certain challenges to employers, as it lacks predictability in terms of duration of the suspension.

Such unpredictability of the term of suspension is caused by the fact that neither the Labour Code nor the applicable legislation provide a maximum term for the suspension period or for the agreement concluded by the employee acting in any of the above capacities. Thus:

the foster carer contract may be concluded for up to 3 years, with the possibility of renewal by the authorities, if the necessary certificate is renewed[4];
the contract for a personal assistant to a severely disabled person or a professional personal assistant is concluded usually for a determined period of 1 year, with the possibility of renewal; however, the contract may also be concluded for an indefinite period of time in certain cases[5].
Another challenging aspect for both employees and employers resulting from this latest legislative amendment is that, in the case of foster carer, the applicable legislation provides that one may become a foster carer only under the condition of terminating any existing individual employment agreements with a different scope.

Our recommendations

We recommend employers that receive such a request from an employee verify that the legal conditions are met and carefully draft the decision suspending the individual employment agreement in order to minimise the legal risks. 

3. Paid carer’s leave

The end of the controversy

As of 25 May 2023, G.E.O. no. 42/2023[6] expressly provides that employees have the right to paid days during the carer’s leave, effectively putting an end to any issues and debates that took place in practice since the carer’s leave was introduced last year, regarding whether such leave days were paid or unpaid.

As a reminder, the carer’s leave consists of up to 5 business days of leave/calendar year to be granted at request, for employees that must provide care or personal support to a relative or person who lives in the same household and needs care or significant support due to a serious health issue.

Legislative changes have also been enacted in the area of social security (i.e., G.E.O. no. 158/2005 on leave and allowances in social health insurance[7]), providing that insured persons are entitled to leave and allowances for the care of a sick child up to the age of 12 - the previous limit was the child's 7th birthday.

In the case of a disabled child, the limit for intercurrent illnesses remains unchanged, until the child's 18th birthday.

Our recommendations

Employers who have considered the carer's leave as being unpaid, insofar as they have provided for this in their internal rules, must update these provisions accordingly.

4. Additional legal rights

4.1. Additional days off

The first benefit for employees adopted this year was introduced by Law no. 52/2023[8] as of 9 March 2023 and consists of two new public holidays, namely, 6 and 7 January.

4.2. Increased value for meal vouchers

In July 2023, by G.E.O. no. 69/2023[9], the value of meal vouchers was increased.

Given that the value of these vouchers has remained unchanged over the last two semesters, although the price of food and utilities has increased significantly, the Romanian Government decided to increase the value in two stages: from RON 30 to RON 35, starting on 1 August 2023, and RON 40 from 1 January 2024.

Our recommendations

We recommend that employers update their internal regulations with the new entitlements (i) by introducing the new public holidays and (ii) by increasing meal vouchers, if the unit's budget allows such a facility.

II. Amendments to the Law on Social Dialogue

Although the Law on Social Dialogue just recently entered into force (i.e., 25 December 2022), as of 25 May 2023, it has been amended and supplemented by G.E.O. no. 42/2023, the main aim being to clarify the original provisions that generated some controversy, as they appeared to be unclear or insufficiently detailed.

The main changes that improve the flexibility of collective bargaining concern the issues outlined below.

1. Harmonisation of the provisions regarding the suspension by law of the individual employment agreement in the case of occupying a salaried management position within the trade union organisation

In its initial form, the Law on Social Dialogue provided the suspension by law of the individual employment agreement only for public officials and public officials with special status during the period in which they were elected within the management body and paid salary rights by the trade union.

The legislative amendment extended this suspension case to any person elected to the management body and who is paid salary rights by the trade union, following notification by the trade union.

This legislative change is in alignment with the provisions of the Labour Code, as the basis for this suspension is Article 50 Letter e) of the Labour Code - i.e., performance of a paid management position in a trade union.

2. Harmonisation of the provisions regarding the suspension of the individual employment agreement at the initiative of the employee in case of strike

In its current form, the Law on Social Dialogue stipulates that during the entire duration of participation in the strike, the individual employment agreement shall be suspended at the initiative of the employee (as opposed to the initial provision, which stated that it is suspended by law).

This change is in alignment with the provisions of the Labour Code, namely, of Article 51 Letter f) of the Labour Code, which provides that the employment relationship may be suspended at the initiative of the employee for participating in the strike.

3. Longer term for employers to issue the convocation for collective bargaining

The new legislative amendments provide a longer term of 15 calendar days (instead of the initial 5 calendar days) from the start of the negotiation procedures, for the employer to convene all parties entitled to negotiate the collective labour agreement and to hold the first negotiation meeting.

4. Establishing collective bargaining sectors and the corresponding NACE codes

As of 25 November 2023, G.E.O. no. 42/2023 repeals Government Decision no. 171/2023 on the setting of collective bargaining sectors and their related NACE codes.

New collective bargaining sectors may be formed on the basis of a consensual request from the representative social partners at the national and/or sectoral level and subject to the approval of the National Tripartite Council for Social Dialogue.

The procedure for setting up new collective bargaining sectors and the classification of the sectors established will be approved by an order of the minister responsible for social dialogue.

5. Clarifications for the procedure for changing the status or composition of the governing body of trade union organisations

A series of clarifications were added with respect to the procedure for changing the status or composition of the governing body of trade union organisations.

Thus, there should be submitted together with the application to amend the statutes and/or the composition of the management bodies of trade union organisations, documents such as:

  • a copy of the final court decision granting legal personality and a copy of the latest final court decision amending the statutes or the composition of the management bodies, where applicable;
  • a list of the members of the executive management body, including their surname, forenames, personal number and trade union function.

6. Representation of employees/workers at unit level

As per the latest legislative amendments, employees or workers will be able to be represented at the unit level as follows:

  • by the legally constituted and representative trade union organisations at the unit level;
  • where there are no trade union organisations representing employees/workers as referred to in point (i), by the representative trade union federations in the collective bargaining sector, at the request and with the mandate of the non-representative trade unions in the unit affiliated to them;
  • where there are no organisations representing employees/workers, in accordance with points (i) and (ii), by non-representative trade union federations in the collective bargaining sector that are members of nationally representative confederations, at the request and on the basis of the mandate of their affiliated non-representative trade unions;
  • if there are no organisations representing the employees/workers, in accordance with points (i)-(iii), by all non-representative trade unions in the establishment;
  • if there are no trade unions established in the establishment, by representatives of the employees/workers elected by a vote of at least half plus one of the total number of employees/workers in the establishment and specially mandated for this purpose, in compliance with the applicable legal provisions.

7. New administrative fines

As of 24 June 2023, G.E.O. no. 42/2023 introduced the following new administrative fines:

administrative fine between RON 20,000 and RON 25,000 (approx. EUR 4,000 - EUR 5,000) for any act of interference by employers, or employers' organisations, either directly or through their representatives or members, in the establishment of trade union organisations or in the exercise of their rights;
administrative fine between RON 5,000 and RON 10,000 (approx. EUR 1,000 - EUR 2,000) for unjustified refusal to register collective bargaining agreements;
administrative fine between RON 30,000 and RON 50.000 (approx. EUR 6.000 - EUR 10.000) for any interference by public authorities, employers and their organisations in the election of employee/worker representatives or in preventing such elections from taking place.

Our recommendations

We recommend employers to consider the new changes during collective bargaining in order to avoid the related legal risks (e.g., non-registration of the collective agreement, strikes or fines).

By Remus Codreanu, Partner, Catalin Roman and Lidia Zarnescu, Senior Associates, and Rena Saftencu, Associate, Kinstellar

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