Gruia Dufaut

ROMANIAN EMPLOYERS ARE OBLIGED TO INITIATE COLLECTIVE BARGAINING

ROMANIAN EMPLOYERS ARE OBLIGED TO INITIATE COLLECTIVE BARGAINING

Last updated: 6 November 2018

As a result of the publication of Government Emergency Ordinance no. 79/2017 amending the Fiscal Code, the Executive passed Emergency Ordinance no. 82/2017 published in Official Journal no. 902/16.11.2017.

This Ordinance provides the obligation for the employers to start collective bargaining, between 20 November and 20 December 2017, for the implementation of Government Emergency Ordinance (OUG) no. 79/2017.

However, the legal text does not detail what the implementation of this OUG no. 79/2017 means… Without actually saying this, the Government wants employers to negotiate the increase of their employees’ gross salaries, so that their net salaries stay the same from the 1st of January 2018.

Without an increase of the gross salary, OUG no. 79/2017 would entail a decrease of the net salary.

As a reminder, OUG no. 79/2017 changes how compulsory social security contributions are paid. As a consequence thereof, the Government has transferred to employees the entire amount of CAS (retirement contribution), respectively CASS (health insurance contribution) ; at the same time, the income tax was reduced from 16% to 10%.

How will these negotiations take place?

I. FOR COMPANIES WHERE THERE IS NO COLLECTIVE EMPLOYMENT CONTRACT OUG no. 82/2017 provides that, by way of derogation from the provisions of article 129 (1) of Law no. 62/2011 on social dialogue, companies where no collective employment contract exists it is mandatory to negotiate collective bargaining for the implementation of OUG no. 79/2017.

THEREFORE, regardless of the number of employees (even if the company has less than 21 employees), between 20 November and 20 December 2017, employers have to initiate collective bargaining for the implementation of OUG no. 79/2017.

II. FOR COMPANIES WHERE THERE IS A COLLECTIVE EMPLOYMENT CONTRACT OUG no. 82/2017 provides that, by way of derogation from the provisions of article 129 (3) and (5) of Law no. 62/2011 on social dialogue, companies where a collective employment contract exists , it is mandatory to proceed to the collective bargaining of addenda to the collective employment contracts in force.

THEREFORE, without complying with the 45-days term until the expiry of the collective employment contract or the 60 days term regarding the duration of collective bargaining, between 20 November and 20 December 2017, employers must negotiate an addendum to the collective employment contract, in order to implement OUG no. 79/2017!

IN CONCLUSION, between 20 November and 20 December 2017, employers must initiate negotiations/negotiate (but not necessarily conclude…) an addendum to the collective employment agreement stipulating the gross/net wages in the company as of the 1st of January 2018.

Failure to comply with the obligation to initiate collective bargaining may be considered a refusal to start the bargaining procedure represents an infringement under art. 217 of Law no. 62/2011 and is punishable by a fine between Lei 5,000 (approximately Euros 1,200) and Lei 10,000 (approximately Euros 2,400).

Plus, there is a risk of triggering a collective labor dispute.

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Furthermore, for companies whose union is not affiliated to a federation of unions relevant for the company’s activity sector, the employees’ representatives may be accompanied during the collective bargaining by the representatives of the union federation, pursuant to the company’s union authorization.

For companies where there is no union, the employees’ representatives may be accompanied during the collective bargaining by a representative of a federation of unions relevant for the company’s activity sector or by a representative of a confederation of unions relevant at the national level, pursuant to the invitation of the employees’ representatives.

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