Labor Code – Major changes

The Labor Code has been significantly changed yesterday, once a normative act has been published in the Official Gazette. In essence, the most important of the news refers to undeclared work and it will significantly influence the work of employers.

Practically, the new provisions will have a significant influence on the employers activity, noting that they were originally included in a bill, but later moved into a document whose legal path was much easier and faster.

It is worth noting that, as compared to the version proposed by the Ministry of Labor, the fines for undeclared work will have a maximum amount, and no minimum amount (so no interval of values), and they will be applied for each person who will be found without an individual labor contract, and not just in cases in which at least five people are identified in this situation, as previously established.

1. Additional acts will have to be completed before they take effect

Perhaps the most significant change that has occurred for employers activity is the shortening of the term in which additional acts for contractual changes can be concluded (e.g. when wage are increased or when the criteria for assessing professional activity change). Specifically, additional acts will have to be concluded before they take effects, not within 20 working days of the occurrence of the changes.

2. Fines for work of part-time employees outside the schedule

If a part-time employee goes to work outside the contractually agreed work schedule, he / she will, according to the law, perform undeclared work. Until now, this activity was not identified by the Labor Code as undeclared work, but there was only a ban on overtime work by part-time workers. Thus, this form of undeclared work could be sanctioned with fines of 10,000 lei for each identified person. In its initial form, the project launched by the Ministry of Labor provided fines of between 5,000 and 10,000 lei.

3. Fines for work of employees during suspension of labor contract

Another form of undeclared work is officially considered to be the employment of employees during the suspension of the individual labor contract. This change is, in fact, only a recognition in the legislation of the jurisprudence of the Supreme Court of Romania. Specifically, for work during the suspension of the contract, employers will face fines of 20,000 lei for each identified person (instead of fines between 10,000 and 20,000 lei, as originally stated).

4. Accepting work without contract and without reporting it in Revisal, undeclared work

In addition to the work during the period of suspension of the individual labor contract and outside the contractually agreed work schedule for part-time employees, the normative act appeared yesterday identifies two more facts that constitute undeclared work. More specifically, getting to work without concluding the individual labor contract before starting work and getting to work without registering the employment relationship in Revisal before starting work. Both facts will be sanctioned with fines of 20,000 lei for each identified person (which, actually, is already happening: the first act is now covered by the Labor Code, and the second – by the Government Decision on Revisal). Here again, the minimum amount of fines of 10,000 lei was abolished, with only one value being retained, the maximum one (20,000 lei).

5. Indulgence for employers who pay rapidly the fines for undeclared work

For the four facts that will represent undeclared work, employers will be able to pay only half of the minimum fines, but only if they pay them within 48 hours of the conclusion / communication of the contravention report. So, we are talking about getting to work without concluding the individual labor contract before starting work, getting to work without registering in the Revisal the employment relationship before starting work, accepting an employee at work while his / hers individual labor contract is suspended and accepting a part-time employee at work outside the contractually agreed work schedule.

6. Keeping records of working hours will be much stricter

The record of daily employee activity will need to be more detailed than it has been up to now. Specifically, if previously employers were required to keep records only of working hours, they would now be required to record both the start time and the end time of the work program.