New Proposals for Amending the Romanian Labour Code

Not happy with the latest amendments to the Labour Code, trade unions are striving to change the situation in their favour.

Employees against employers

Only one year from the lat­est impor­tant changes to the Roman­ian Labour Code, one of the country’s biggest trade unions draft­ed a project for amend­ing again the Labour Code. The project is co-financed by the Euro­pean Social Found though the Oper­a­tional Pro­gramme for Human Resources Devel­op­ment 2007 – 2013.

The trade unions see the changes from 2011 as favourable to employ­ers and are try­ing to bring the bal­ance back in their favour.

Main changes proposed

First, one of the main changes is relat­ed to the val­ue of the min­i­mum wage on the econ­o­my, aim­ing to increase its val­ue to be equal or high­er than 50% of the val­ue of the medi­um net salary com­mu­ni­cat­ed by the Nation­al Sta­tis­tics Insti­tute. Accord­ing to the project, the min­i­mum gross salary should exceed RON 1,050.

A sec­ond impor­tant change refers to the cri­te­ria for col­lec­tive dis­missals. Trade unions pro­pose that, when estab­lish­ing the pri­or­i­ty order upon dis­missal, per­for­mance objec­tives should not be used as employ­ee tie-break­ing cri­te­ria.

Third, oth­er changes are envis­aged con­nect­ed to per­for­mance objec­tive – one of the biggest employ­ee com­plaints. The pro­mot­ers of the project claim that the pos­si­bil­i­ty of the employ­er to uni­lat­er­al­ly estab­lish per­for­mance objec­tives may lead to abuse.

The amend­ments’ aim is that estab­lish­ment of per­for­mance objec­tives be made via nego­ti­a­tion between the employ­er and the employ­ees’ rep­re­sen­ta­tives, and estab­lished on the cat­e­go­ry of employ­ees through the applic­a­ble col­lec­tive bar­gain­ing agree­ment or inter­nal reg­u­la­tion.

More­over, non-ful­fil­ment of the per­for­mance objec­tives should not trig­ger dis­missal for pro­fes­sion­al incom­pli­ance, as the labour law cur­rent­ly pro­vid­ed. Rather, it should be a con­di­tion for a high­er salary or for pro­mo­tion.

To this end, a spe­cial clause may be nego­ti­at­ed between the employ­er and the employ­ee and insert­ed in the indi­vid­ual employ­ment agree­ment: the “per­for­mance objec­tive clause”.

Non-compete clauses

The trade unions believe that the non-com­pete clause should also be recon­sid­ered. Cur­rent­ly, such a clause is effec­tive only after ter­mi­na­tion of the employ­ment rela­tion­ship. The new pro­pos­als envis­ages that a non-com­pete clause be effec­tive only dur­ing the employ­ment agree­ment. Only excep­tion­al­ly could it be applied after the ter­mi­na­tion of the employ­ment rela­tion­ship.

Anoth­er change refers to the pos­si­bil­i­ty grant­ed to the employ­er to uni­lat­er­al­ly denounce the non-com­pete clause at any time dur­ing its applic­a­bil­i­ty. Also, indem­ni­ty amount is envis­aged to vary between 25% of the base salary if the clause is applic­a­ble dur­ing the exe­cu­tion of the employ­ment agree­ment, and 50% from the aver­age of the last six months’ gross incomes (as is cur­rent­ly reg­u­lat­ed) if the clause is effec­tive after ter­mi­na­tion of employ­ment.

More envisaged changes

Like the above, it is envis­aged that the con­fi­den­tial­i­ty clause be applic­a­ble only for the dura­tion of the agree­ment and, only by excep­tion, after its ter­mi­na­tion – but only for cer­tain infor­ma­tion and for a lim­it­ed time.

Besides the pro­ba­tion peri­od, to deter­mine the apti­tudes of employ­ees in the pri­vate sec­tor, oth­er forms of exam­i­na­tion can be used, such as com­pe­ti­tion or exam.

Manda­to­ry pay­ment of an indem­ni­ty if the indi­vid­ual employ­ment agree­ment is ter­mi­nat­ed by mutu­al agree­ment should be also reg­u­lat­ed. In prac­tice, such an indem­ni­ty is usu­al­ly paid by the employ­er, but trade unions pro­pose that this be express­ly reg­u­lat­ed in the Labour Code.

The dura­tion of the indi­vid­ual employ­ment agree­ment con­clud­ed for a deter­mined peri­od should be extend­ed from three years to a max­i­mum of five years.

It was also pro­posed that the con­cept of work­ing from home (tele­mu­nca) be express­ly reg­u­lat­ed in the Roman­ian Labour Code – already done in prac­tice but not reg­u­lat­ed.

The social dialogue law

Unions also want to change the social dia­logue law.

Cur­rent­ly, col­lec­tive bar­gain­ing agree­ments, trade unions, employ­ers unions and social dia­logue between employ­ees and employ­ers are reg­u­lat­ed under Law no. 622011 regard­ing social dia­logue. Trade unions’ pro­pos­als include some sig­nif­i­cant changes in this respect as well, main­ly with a view to assure more pro­tec­tion for employee’s rep­re­sen­ta­tives in the trade unions.

Even if some of trade unions’ pro­pos­als are wel­comed, most aim to pro­tect sole­ly employ­ees. It remains to be seen what the posi­tion of the employer’s unions will be and whether the pro­pos­als will be imple­ment­ed into law.

It is envisaged that the confidentiality clause be applicable only for the duration of the agreement and, only by exception, after its termination – but only for certain information and for a limited time.

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schoenherr attorneys at law / www.schoenherr.eu