Romania: Temporary agency work and collective bargaining in the EU

  • Observatory: EurWORK
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  • Published on: 18 December 2008



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Temporary agency work has been regulated and recognised in Romania since 2003, and has been growingly popular since 2005. The significant economic growth and the free movement of Romanian workers in the European Union states have brought personnel recruiting and leasing agencies to prominence. Nevertheless, temporary work does not seem to have been considered as one of the components of social dialogue and collective bargaining at national level.

Section 1. Definitions

1) In your country, is there a statutory definition of:

a) temporary agency work?

Labour Code, article 87 (3): ‘A temporary work agency is a business venture licensed by the Ministry of Labour Family and Equal Opportunities (Ministerul Muncii, Familiei şi Egalităţii de Şanse, MMFES), which provides to user enterprises, on a temporary basis, skilled and/or unskilled labour that such an agency employs and pays for this purpose.’

b) agency worker?

Labour Code, article 87 (2): ‘An agency worker is a person employed by an employer that acts as a temporary work agency, and makes such person available to a user enterprise, temporarily, in order to perform precise tasks.’

c) user enterprise?

Labour Code, article 87 (4): ‘A user enterprise is the employer to which the temporary work agency provides a temporary worker for the performance of precise tasks on a temporary basis.’

If yes, please give definitions.

2) Is there a collectively agreed definition of:

a) temporary agency work?b) agency worker?c) user enterprise?

If yes, please give details (e.g. how and where defined).

Collective bargaining agreements do not contain any definition as above.

3) In your country, would you describe TAW as a sector in its own right?

In Romania, TAW is viewed as a supplier of services within other sectors.

Section 2. Regulatory framework

1) Have there been any changes in the law concerning TAW since 2004?

a) Yes

After the regulation of the basic legal framework through Law no. 53/2003, regarding the Labour Code, the following legislative developments occurred:

  • In 2004, the government issued Decision 938 regulating the establishment, operation and licensing of temporary work agencies;
  • In 2005, the Government issued Decision 226, which determined the charge for licensing and extension of licensing as the equivalent of three national average gross wages;
  • In 2007, the Government issued Decision 557, which transposes Directive 91/383/CEE, and provides for the improvement of labour security and health of temporary employees on the payrolls of temporary work agencies. This binds the temporary work agencies to offer their temporary employees the same working conditions as for permanent employees. It is for the temporary work agency to secure the requisite individual protective outfit for any temporary job. The temporary work agency must inform and train their temporary personnel in respect of the jobs and skills they are required to perform, and of the hazards specific for each type of job. It is also the temporary work agency’s duty to furnish the user with the employment contract for the temporary employee. Similarly, the agency signs with the temporary worker a temporary employment contract, and is liable for the labour security, health, and hygiene conditions in which the temporary worker performs duties.

2) How is TAW regulated in your country?

a) Is there a legal framework specifically for TAW; and/or is it covered by general labour law (including case law/ jurisprudence)?

The general legal framework governing TAW is the Labour Code, Title II (‘The Individual Employment Contract’), Chapter VII (‘Employment through Temporary Work Agencies’). Complementary to this legislation are the government decisions referred to in item 1 above.

b) What is the role, if any, of collective labour agreements and self-regulation?

The rights provided by the national, sectoral, and company collective agreements apply, similarly, to temporary employees, even though such agreements contain no distinct provisions or collective bargaining in this respect.

According to law, the temporary work agencies negotiate with the user the salary and the working conditions of temporary workers, conditions that may differ from those provided in the collective agreements and applicable to the user’s workers hired under employment contracts for an indefinite duration.

3) What is regulated in these provisions? In particular, does it cover:

a) use of agency work (e.g. length of assignment, sectoral bans, permitted reasons of use, number of agency workers per company, other)

The permitted reasons for use stipulated in the Labour Code, article 88 are: the performance of a precise, but temporary, task, referred to as temporary work assignment, and only in the following cases:

  • to replace a permanent worker whose permanent employment contract is suspended, during the suspension period;
  • to perform seasonal work;
  • to perform specialized or occasional work.

The length of assignment is regulated by article 89 of the Labour Code as follows:

  • The length of a temporary work assignment may not exceed 12 months.
  • The length of a temporary work assignment may be extended once, for a period which, added to the initial length of the assignment, may not exceed 18 months.
  • The reasons for which the length of a temporary work assignment may be extended shall be as stipulated in the individual employment contract, or as agreed upon in an addendum thereto.

Romanian law prescribes no sectoral bans, nor does it cap the number of temporary workers in a company.

b) the form of the contract (e.g.project, fixed-term, special contract, open ended, etc.)

Government Decision no. 938/2004 regulates two types of specific employment contracts:

  • the employment contract made by and between the temporary work agency and the employee, referred to as the temporary employment contract, which spells the following: the parties’ particulars; temporary work assignment; type of business; user’s identity and place of business; place of the temporary work assignment, or the option that the temporary employee may perform duties on the premises of several users; worker’s professional qualification and skills; effective date of the contract; length of the assignment; concrete working conditions, with a reference to the specific hazards of the job, if any; annual leave; probation period, if any; notice requirements; salary entitlements, means of payment, frequency of payment; normal length of working time; data related to the foreign-based location, when the worker is recruited for work abroad; provisions regarding termination of contract by the agency, upon request of the user.
  • the employment contract made by and between the temporary work agency and the user, referred to as the sourcing contract, which spells the following: the reason and the purpose for which the use of a temporary work is necessary; time span required for the temporary work assignment, and any amendment thereof; job description, qualification required, place of performance of the assignment, working schedule; working conditions; individual protection outfit and working implements the temporary worker is supposed to use; any other services or facilities to be made available to the temporary worker; worth of the contract, split into the share due to the agency and the salary due to the worker; user’s obligation to give the worker the labour health and safety briefing.

Contracts may be made for the length of the assignment, which may not exceed 12 months, and may be extended only once, without exceeding an overall period of 18 months.

c) social security and social benefits

According to the Labour Code, article 95 (4), the duty to withhold and transfer all taxes and charges owed by the temporary worker to the state budgets resides with the temporary work agency.

Under article 99 of the same Code, a temporary work agent who dismisses a temporary worker before completion of the temporary employment contract for reasons other than discipline must comply with the provisions of the labour legislation governing termination of contract for reasons that are not imputable to the employee.

Similarly, article 100 of the Code provides that, unless the law provides otherwise, the standards and legal provisions of the collective agreements applicable to the permanent employees of the user shall apply, with the same full measure, to the temporary workers, for the period of their temporary assignment therewith.

d) conditions to open a TAW agency (e.g. license or authorisation schemes, supervision by public authorities, financial requirements, or others - please specify)

To be authorised and licensed as temporary work agencies, business ventures providing such services must fulfil all of the following conditions set forth in article 3 of Government Decision no. 938/2004, respectively:

  • be incorporated according to law, and include in their scope of business the recruitment and employment of labour;
  • have a clean tax payer record with the state or local budgets for social security contributions, unemployment benefit contributions, labour accident and hazard benefit contributions, and health insurance contributions;
  • have a clean record in respect of liabilities arising from financial, customs, and fiscal discipline regulations;
  • have a clean record in respect of labour, trade, and tax legislation;
  • pay the bond.

The MMFES is the supervising authority, through the Department for Dialogue, Family and Social Solidarity, and its local subsidiaries.

e) business activities/services delivered by TW agencies (e.g. prohibition to provide other services than TAW)?

The law does not bar TW agencies from providing services other than temporary labour.

f) third-national companies or temporary agency workers (e.g. activities of foreign agencies)?

There are no restrictions to the above.

4) Do any regulations (by law and/or collective bargaining in the TAW sector) specify equal treatment rights for agency workers with permanent workers in the user enterprise concerning:

a) pay

Labour Code, article 95: ‘For the entire duration of the assignment, a temporary worker shall enjoy the salary due to him/her by the temporary work agency; the salary received by the temporary worker for each assignment may not be lower than the salary received by a permanent worker of the same user for the same or a similar kind of work; when the user has no permanent worker performing the same type of work, the salary of the temporary worker shall be determined in accordance with the provisions of the collective agreement governing that particular type of work for a permanent employee and applicable to the employer concerned.’

b) training

Under article 21 of the Government Decision no. 938/2004, the user of temporary labour must provide its temporary workers access to the vocational training courses given to its permanent employees.

c) other terms or conditions of employment?

If yes, please give details.

Article 100 of the Code provides that, except where the law provides otherwise, the standards and legal provisions of the collective agreements applicable to the permanent employees of the user shall apply, with the same full measure, to the temporary workers, for the period of their temporary assignment therewith.

5) Do TAW workers have the right to information, consultation and representation?

If yes, please specify the nature/basis.

Article 21 of Government Decision no. 938/2004 provides the obligation of the user of temporary labour to inform its temporary workers on all available vacancies, in order to ensure an equal opportunity treatment with the user’s permanent workers. For this purpose, the user shall advertise the vacancies in a place that is visible to all its employees, permanent or temporary.

There is no rule precluding temporary workers from affiliating with the permanent workers’ unions, in which capacity they enjoy the same rights to be informed and consulted.

6) Is there a control/enforcement mechanism regarding any TAW regulation?

If yes,

a) is there a special labour inspectorate or a bi-partite body governing TAW?

The supervising authority is the MMFES, through the Department for Dialogue, Family and Social Solidarity, and its local subsidiaries.

b) are there any sanctions/penalties for not respecting the regulations (whether stemming from law and/or collective agreements)?

Government Decision no. 938/2004 provides that: the failure to pay salary entitlements, the breach of the obligation to keep MMFES relevant departments informed of any change of name, place of business, formation of unincorporated extensions, or modification of the licensing criteria within five days of their occurrence, and the breach of the obligation to furnish the identification data of any promotional activity will incur fines in the range of RON 2,000 to RON 4,000 (approximately EUR 500 to 1,000), and that the provision of services specific for a TAW by a venture that does not hold the relevant license will be punished with fines of RON 10,000 to RON 20,000 (EUR 2,500 to 5,000).

7) Are there any procedures governing use of TAW and strike breaking?

In particular, can workers on strike be replaced by agency workers?

According to article 92 of the Labour Code, the user may not employ the services of a temporary worker if the purpose of such employment is to replace one of the user’s permanent workers whose permanent employment contract has been suspended due to his participation in a strike.

Section 3. Social dialogue and collective bargaining

1) Is there any employers’ association(s) for TAW firms in your country?

If yes, please provide any data on membership (e.g. sectoral coverage of firms/workers)

Not applicable.

2) Is there any union(s) specifically for agency workers?

If no, have any unions or confederations targeted the recruitment of agency workers? launched any campaigns around agency workers’ rights?

Not applicable.

3) Collective bargaining levels

Is TAW governed by collective bargaining at:

a) intersectoral/ national level?

Not applicable.

b) the sectoral level for TAW?

Not applicable.

c) company (ie. temporary agency firm) level?

Not applicable.

If yes, please provide details of the parties concerned.

4) Collective bargaining outcomes

Please provide examples and details of any recent/ significant collective agreements governing TAW at the levels referred to in question 3.

[Correspondent:] Please indicate what issues and outcomes are covered, and particularly where there are any terms concerning parity with permanent workers at the user enterprise, e.g. concerning pay, benefits, working time, training, consultation and representation.

No data available.

5) Are there any examples of sector- or company-level collective agreements in other sectors that restrict, permit or otherwise regulate the use of TAW within their domain?

[Correspondent:] If yes, please give details. Particularly highlight any agremeents that have any terms concerning parity with permanent workers at the user enterprise.

Not applicable.

6) Please provide any data concerning:

a) trade union density for agency workers b) the coverage of collective bargaining within the sector.

Not applicable.

Section 4. Employment and working conditions of TA workers

1) Please provide the most recent data (averages) on TAW employment

a) longevity of TAW employment, i.e. how long workers remain employed

- in the sector?

- with a particular agency?

The representative of the temporary work agency Lugera & Makler (one of the top four agencies of this type in Romania, the other three being Adecco, Manpower and Professional), stated for the daily newspaper ‘Adevarul’ (May 2008) that ‘the average length of a temporary employment contract signed with the agency is three months.’

b) duration of TAW placements, i.e. i.e. the length of assignment in a user company.

The marketing and communication coordinator of Manpower told the press that ‘Industrial production, civil engineering, retail, IT and secretarial services are the main sectors in which lease labour is in demand, with peaks during summer and around Christmas and Easter holidays.’

2) Please provide any evidence from official, academic and social partner sources concerning:

a) the reasons for user companies’ usage of TAW, including any differences by sector, occupation, firm size etc.

An Adecco spokesperson is of the opinion that users resort to temporary work agencies because this allows flexibility along their business cycle (Adevărul, 14 May 2008).

The representative of Lugera & Makler said that users’ most common requests for temporary workers target minimally skilled labour and specialised personnel.

b) reasons for workers participation in the sector and levels of satisfaction, including any differences by age, sex, education etc.

An Adecco representative thinks that lease labour gives job seekers wider employment opportunities, and the chance to gain multiple on-the-job training.

In addition, Lugera & Makler explained, when the temporary employment contract terminates, many users prefer to continue with the same workers, on a permanent employment contract.

3) In practice, which rules and procedures may apply to temporary-agency workers in contrast to other workers in the user company?

One of the disadvantages of temporary workers is the still limited access to certain types of loans/credits, because of the limited length of their employment contract.

Section 5. The extent and composition of TAW.

1) For 2004 and 2007, please state

a) the number of agency workers

According to the information published in the ‘Quarterly Statistical Bulletin on Labour and Social Protection’ by MMFES, the number of temporary individual employment contracts grew from 324,871 in 2004 to 431,971 in 2006; in the third quarter 2007 they were in a number of 351,461.

According to the data carried by the publication of the National Statistic Institute (Institutul Naţional de Statistică, INS) titled ‘Household Labour Force. Employment and Unemployment’ (‘Forţa de muncă în gospodării. Ocupare şi şomaj’, AMIGO), the number of temporary workers remained relatively constant during the period 2004-2007, in the region of 113,000 persons. Of all temporary workers on record in 2004, some 42% were hired on contracts for maximum 6 months, and 24 % on contracts for 6 to 12 months. In 2007, the two ratios had changed to 30% and, respectively, 33%.

These data covers all the temporary workers, not only those employed by TAW.

According to the Business Standard issue of 18 March 2008, featuring on the payrolls of the top four temporary work agencies are 25,000 temporary workers.

b) total revenues of the TAW sector

In 2007, the personnel’s leasing market accounted for approximately EUR 60-65 million, and is expected to reach EUR 120 million by the end of 2008.

2) What proportion of the TAW workforce is currently

a) male/ female?

The data provided by the INS in the publication AMIGO reveal that approximately 57% of the temporary employees in the reference time span 2004-2007 were males.

b) full/part time?

According to the information published in the ‘Quarterly Statistical Bulletin on Labour and Social Protection’ by MMFES, part time employment accounted for 11% of all temporary individual employment contracts for the year 2004, 10.1% for 2006, and 11.9% for third quarter 2007.

INS data in the AMIGO show that 5.4% of the temporary workers in 2004, and 6.7% in 2007 were hired for a working time of less than 40 hours/week.

c) young (<c. 25) or older (>c. 50) workers?

No data available.

3) Has there been any changes to the TAW sector in terms of

a) concentration, i.e. proportion of employees or turnover accounted for by the largest firms?

In Romania, the top four temporary work agencies are: Adecco, Manpower, Lugera & Makler şi Profesional.

At 31 December 2007, ‘The National Registry of Temporary Work Agencies’ featured a number of 107 duly licensed agencies.

In 2007, for example, of a total number of 25,000 temporary workers hired through such agencies, 6,600 were listed with Adecco, 5,000 with Manpower, 4,500 with Lugera & Makler, and 2,500 with Professional.

b) internationalisation, i.e. number/significance of multinational TAW firms?

All of the four top temporary work agencies are multinational companies.

4) What is your evaluation of the availability and quality of statistical data concerning TAW in your country?

Since the regulation of the establishment and operation of temporary work agencies is of relatively recent date (three years), the statistic information regarding their activities is not substantive enough to allow forecasts.

Commentary by the NC

At present, the most dynamic sectors in Romania are construction and tourism, which are seasonal in nature, and therefore require temporary work. Companies operating in these sectors encounter growing difficulties in sourcing and hiring labour. On the other hand, many Romanian workers are still interested in making a living, be it temporary, in other Member States of the European Union. These are factors that have added value to the temporary work agencies.

Small and medium enterprises in Romania do not seem interested in resorting to sourcing labour through the temporary work agencies, due to the extra costs involved.

Immediately after the enactment of Government Decision no. 938/2004, the representatives of the National Council of Small and Medium Sized Private Enterprises in Romania (Consiliul Naţional al Întreprinderilor Private Mici şi Mijlocii, CNIPMMR) found this new piece of regulation on temporary work an additional beaurocratic link in the employer – employee chain, leading to extra spending for the companies seeking labour, and to lesser earnings for the temporary workers, due to the commission owed to the agent, all of which unduly increases the tax burden.

Joining in the chorus of traditional employers, the temporary work agencies themselves addressed the authorities for a better articulation of such regulations with the specifics of the Romanian labour market.

Conversely, the trade unions are adverse to a large scale use of temporary employment contracts, and to manipulating the concept of flexibility as a means to lengthen the daily and weekly working schedules. Therefore, they demanded that all the labour legislation be enacted only after due consultations with the social partners.

PhD Luminita Chivu, Institute of National Economy, Romanian Academy

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