A new law about the posting of workers

A recently enacted law addresses the posting of workers who provide services and sets a common framework of provisions. These measures and control mechanisms will apply in Romania to workers posted to deliver services in another country and it includes prevention measures and sanctions for violations of these provisions.

The purpose of this law is to guarantee a protection regime for workers posted from Romania to another EU member state or Switzerland and vice versa and to ensure compliance with the employment regulations established by national legislation.

The provisions of this law apply both to employees of companies established in Romania who are posted to the territory of another EU member state or to Switzerland for the delivery of services and to workers posted to Romania by companies established in any EU member state or Switzerland.

By the provisions of this law, regardless of the applicable law of the employment contract, workers posted to the territory of Romania from another EU member state or Switzerland must benefit from the employment conditions provided under Romanian law and, if applicable, any collective bargaining agreements at the sectorial level. These provisions are intended to ensure compliance with the legal provisions that govern:

  • the maximum working period and the minimum rest periods;
  • the minimum paid annual holidays;
  • the applicable minimum rates of pay, including overtime rates;
  • health, safety, and hygiene at work;
  • non-discrimination at work, either gender-related or other.

Likewise, regardless of the applicable law of the employment contract, the aspects above must also be protected for workers posted by Romanian companies to provide services in other EU member states and Switzerland. These workers must benefit from the employment conditions established by acts with the power of law, administrative acts, collective bargaining agreements, or applicable arbitrations agreements valid in the member state where the work is performed or in Switzerland as the case may be.

If the legislation of the EU member state or Switzerland where the company is established provides more favorable working conditions compared to the Romanian, the more favorable law will apply. Similarly, if the Romanian legislation is more favorable compared to the law of the EU member state or Switzerland (if applicable) where the Romanian workers are posted, the Romanian law governs.

Companies that are not established on the territory of a EU member state or in Switzerland that post workers on the territory of Romania may not benefit from a more favorable treatment than companies established in a EU member state or Switzerland. This means that companies from non-EU members or Switzerland that post worker in Romania must at the least comply with the minimum standards established by Romanian law (e.g., wages, holidays, etc.), and a company may offer employees terms better than the legally required minimum.

Law no. 16/2017 establishes a series of obligations for the companies established in the territory of a EU member state or Switzerland whose workers are posted to Romania to provide services. One of the obligations is for such company to submit to the Romanian labor inspection a statement regarding the posting of its employees, no later than a business day before their employment commencement date, comprising the necessary information that will allow labor inspectors to perform verification at the working place.

Furthermore, this law requires companies to hold and make available to the labor inspectors the employment documents of the posted workers, including their wages and working hours not only during their posting period in Romania but also for three years after the end of their employment in Romania.

To ensure the enforcement of Law no. 16/2017, the Romanian authority appointed to ensure fulfillment of the administrative cooperation with the authorities of other state members is the Labor Inspection (“Inspectia Muncii”). For this purpose, the Labor Inspection representatives are not only in charge of communication with their counterpart authorities, but they must also undertake control measures in cases of such posting that may involve any possible abuse or breach of the applicable legal provisions. The Romanian fiscal authority was appointed as the national authority for the administrative formalities governing the application and recovery of administrative fines levied for the breach of the legal provisions on employment matters. In case the labor inspectors identify breaches of the legal provisions and apply fines, the fiscal authority is in charge of the necessary administrative formalities for the recovery of said amounts..

Law no. 16/2017 on the posting of workers for the delivery of transnational services was published in the Official Gazette of Romania no. 196 of March 21st, 2017, and becomes effective within 60 days since its publication, on May 20th, 2017. The law is to comply with Directive 2014/67/EU of the European Parliament and the Council on the enforcement of Directive no. 96/71/EC.

2016 - All rights reserved Stratulat Albulescu - Attorneys at law