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Romania: New Rules on Kurzarbeit

Romania: New Rules on Kurzarbeit

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Law No. 58/2021 approving GEO no. 211/2020 and amending GEO 132/2020 was published in the Official Gazette of Romania, Part I, No. 345 of 5 April 2021 and will enter into force on 8 April 2021 (the “Law”).

The substantial amendments introduced under the Law are summarised as follows:

I. Conditions for the application of the Kurzarbeit measure

The Kurzarbeit measure may be adopted by employers that fulfil all of the following conditions:

  • The measure affects at least 10% of the employees of the business unit;
  • Proof of the slowdown is a decrease in turnover in the month preceding the application of such measure or, at most, in the month before the month preceding its application, by at least 10% compared to the same month or the monthly average turnover of the year preceding the establishment of the state of emergency/alert/siege, respectively 2019.

II. Increasing the percentage reduction in working hours

In the case of temporary reduction in work due to the declaration of a state of emergency/alert/siege, during such a state, as well as for a period of up to 3 months from the end of the last period in which such a state existed, employers have the option of reducing each employee’s working hours by a maximum of 80% of the daily, weekly or monthly duration specified in that employee’s employment contract.

Previously, GEO no. 132/2020 provided for a maximum reduction of 50%.

III. Consent of the trade union/employee representatives required

The Law lays down a new condition stipulating that if there are trade unions entitled to negotiate the collective bargaining agreement at unit level, or employee representatives, the measure to reduce working time shall be introduced by the employer with the consent of: (i) the trade union organisation entitled to negotiate the collective bargaining agreement or, if it there is no trade union, with the consent of (ii) the employee representatives.

Nevertheless, the employer may change working hours whenever necessary, although it has an obligation to justify such a change and to obtain the consent of the trade union/employee representatives.

IV. Communicating the reduction in working hours to the employee 

As a general rule, the employer’s decision to reduce working hours, the work schedule, the distribution of work across days and the related salary rights must be communicated to the employee at least 5 days before the measure comes into force.

By way of exception, the employee shall be notified at least 24 hours before the measure comes into force if there is (i) a change in the work schedule due to an increase in the employer’s activity requiring additional personnel or (ii) to replace an employee who is unable to work according to their work schedule.

V. Reimbursement for reduced working time of employees

During this period, each affected employee will receive an allowance of 75% of the monthly gross base salary corresponding to the reduction in hours. The allowance is paid by the employer and may be reimbursed by the government.

VI. Prohibition on employing other staff

While the Kurzarbeit measure is in place, it is prohibited to hire staff to do work that is identical or similar to that done by the employees whose working hours have been reduced or to subcontract work carried out by the employees whose working hours have been reduced. The prohibition applies to subsidiaries, branches or other secondary offices as defined in Companies Law no. 31/1990, at which level this measure applies.

By way of exception, it is permitted to hire workers to replace furloughed employees if an employee’s individual employment contract is terminated (i) by effect of law, (ii) by dismissal for reasons related to the person of the employee or (iii) by resignation.

GD no. 719/2020 on the approval of the settlement and payment procedure of the amounts granted based on GEO no. 132/2020 will be amended accordingly by 30 days from the date of entry into force of this Law.

By Mircea-Catalin Roman, Senior Associate, and Flavia Denisa Margas, Associate, Noerr

Romanian Knowledge Partner

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