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Romania: Several Important Employment Legislation Amendments and New Provisions

Romania: Several Important Employment Legislation Amendments and New Provisions

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Several measures related to the Labour Code and other employment legislation have been adopted by the Romanian Government and have immediate effect on employment relationships.

These measures were taken through Government Emergency Ordinance no. 117/2021 (hereinafter referred to as “GEO 117/2021”), Government Emergency Ordinance no. 110/2021 (“GEO 110/2021”) and Government Resolution no. 1071/2021 (“Resolution 1071/2021”).

I. Labour Code amendments

As per the recent amendments, exceeding the working time provided within the part time employment agreements is considered undeclared work. Also, not observing mandatory provisions is sanctioned with a fine from LEI 10,000 to LEI 15,000 for each person considered to be under the mentioned situation.

The legal changes also provide a new concept called underdeclared work. According to the new legal provisions, underdeclared work means paying a net salary higher than that recorded and reported in the payroll and in the monthly statement of social security and income tax obligations and the nominal register of insured persons submitted to the tax authorities. Failing to comply is sanctioned with a fine from LEI 8,000 to LEI 10,000, up to a maximum of LEI 100,000.

Additionally, the period within which overtime is compensated is increased from 60 days to 90 days since the overtime was performed. The measure was adopted in order to make employment relationships more flexible by making it possible to compensate for overtime work with commensurate time off over a longer period of time and to ensure that employers can carry out their work under good conditions. 

Failure to pay the salary to which an employee is entitled for more than one month as of the provided payment date is sanctioned with a fine from LEI 5,000 to LEI 10,000 for each employee whose payment is delayed to this extent.

II. Technical unemployment

Until 31 December 2021, for the period of temporary suspension of the employment agreement, at the employer's initiative, for financial, technological, etc. reasons due to the effects of the coronavirus, the allowances to which employees are entitled are to be set at 75% of the basic salary for the position and paid from the unemployment insurance budget but not exceeding 75% of the national average gross salary.

The allowance is paid to employees during the period of: a) temporary interruption of work, in whole or in part, in the context of an increase in the incidence of the SARS-CoV-2 coronavirus and the measures to reduce the impact of the type of risk provided for in the Government's decisions to extend the state of alert in Romania, as well as to b) employees of employers whose work has been suspended as a result of an epidemiological investigation carried out by the county public health directorates.

III. Free paid days for parents

As per GEO 110/2021, days off are to be granted to one parent for the supervision of children up to and including the age of 12 and for parents who have dependent children or adults with disabilities in education or enrolled in a pre-university education establishment, including early pre-school education.

The benefits are to be granted in the event of limitation or suspension of teaching activities involving the physical presence of children in educational establishments and pre-school early education establishments where they are enrolled, in accordance with the applicable legislation. The amounts representing the allowance granted to parents under GEO 110/2021 will be paid by the employer and settled by the State under certain conditions.

By Mircea-Catalin Roman, Senior Associate,  Noerr

Romanian Knowledge Partner

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