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| The First Effects of the New Labour Code 12/05/2011 |
| (2011-05-12) |
| Last updated: 2011-05-13 12:56 EET |
Regional Labour Offices on Thursday announced an increase in the number of labour contracts signed, after the new Labour Code came into effect on May 1st. However, trade unions say that most of these contracts are seasonal labour contracts and the increase has little to do with the aforementioned law.
The much-debated Labour Code, over which the Romanian government sought a vote of confidence from Parliament, is said to have already had a number of effects since its introduction. The new labour code is primarily aimed at making the labour market more flexible, which was one of the provisions underlying Romania’s agreement with international monetary institutions in order to get external loans in an effort to overcome the economic downturn.
Also, the new legislation tries to curtail black-market employment by stipulating harsher penalties for those who do not abide by field-specific regulations. Both employers and employees face sharp fines, three times bigger than the previous sums. Similarly, employers caught having over 5 employees without a legal labour contract face between 1 and 2 years’ imprisonment. Mixed inspection teams made up of army and police officers and representatives of the Financial Guard and Regional Labour offices discover daily that there are many people who work on the black market, while the number of fines imposed is soaring by the day.
The results of hundreds of such checks all across the country seem to confirm previous estimates, according to which some 1.5 million Romanians are illegally employed. As interim Labour Minister, PM Emil Boc said some 60,000 new employees have been officially reported following the introduction of the New Labour Code. Conversely, trade unions say the increase in the number of labour contracts registered is not necessarily due to the new legislation or to tightened labour checks, but to the onset of the summer season, when construction activities resume and the weather gets warmer. This entails a higher volume of seasonal work.
Another major change in the present code refers to the introduction of assessment criteria in individual labour contracts that will be instrumental in fulfilling performance targets set by institutions. Employers, however, need the employees’ informed consent when agreeing on these criteria. Human resource experts fear some employees might refuse to give their consent over the additional legal and assessment criteria, which may give rise to tensions within the respective institution.
This is largely due to the fact that the law does not have a back-up version, nor does it allow for the termination of labour contracts. Alongside trade unions, the Social-Liberals in the opposition continue to claim the present labour legislation breaches several provisions of the International Labour Organization, making employees even more vulnerable to abuse by employers.
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