Changes to Labour Code come into effect

In July 2011,the Slovak Parliament approved major changes to the Labour Code. These include making it easier and cheaper to make employees redundant and prolonging fixed-term contracts. New criteria for employee representation have also been introduced. However, the minimum wage scale will continue to apply. The amendments came into force in September 2011. Neither employers nor unions approve, with unions claiming the changes violate international conventions.

Parliament approves significant amendments to Labour Code

The Slovak Government approved the so-called ‘major amendment’ to the Labour Code on 28 April 2011. It then submitted the draft bill to Parliament, where it was discussed for almost two months, and finally approved with more than 150 amendments on 13 July 2011. The amendments have significantly altered the Government’s original proposal which was drawn up after consultations between the government and social partners (SK1105019I).

The Prime Minister and the trade unions welcomed the fact that the draft bill maintains the current minimum wage scale. However, employers were disappointed by this. Other amendments included in the draft bill are:

  • new conditions for employee dismissals;
  • new definitions for mass redundancies;
  • changes to rules on overtime and employees’ holidays;
  • new criteria for trade union representation.

Increase in employment flexibility expected

Ivan Gašparovič, President of the Slovak Republic, signed the Act amending Labour Code on 27 July 2011 and it came into force on 1 September 2011. The approval of the Act was welcomed by Jozef Mihál, Minister of Labour, Social Affairs and Family (MPSVR SR). He claimed that the amendments would increase employment flexibility and might contribute to the creation of thousands of jobs.

The changes have been introduced in an effort to help employers to cope better with market fluctuations without having to dismiss employees. The increase of employment flexibility may also be fostered by:

  • the abolition of redundancy payments to those dismissed employees who continue working for the employer during the notice period;
  • the introduction of job sharing;
  • changes to employees’ probation period;
  • extending fixed term contracts (from two to three years) – according to MPSVR SR, only 4.4% of employees work under such contracts (Daily SME, 2 August 2011. Zákonník práce predĺži prácu na dobu určitú).

New rules for employee representation

Under previous labour legislation, employee representation has not been specifically regulated. Employers have often criticised the fact that a trade union organisation with just three members has been able to conclude a collective agreement applicable to all employees, or to organise strikes. Nevertheless, there were no measures on representativeness in the proposal approved by the Government in April. An amendment proposed by members of the government coalition made it necessary for any trade union organisation established after 1 September 2011 to prove, at the employer’s request, that it represents at least 30% of the workforce. Existing trade unions will have to comply from 1 January 2013.

This provision is new to Slovak labour legislation and, with about 16% trade union density nationally, the introduction of the 30% rule may significantly reduce unionisation rates. Members of the Confederation of Trade Unions (KOZ SR) have several objections to the way Parliament has amended the Labour Code proposals. They feel several of the changes violate international conventions, including the European Social Charter ratified by the Slovak Republic, and are consequently considering taking steps set out on their website (in Slovakian) to challenge the amendments to the Labour Code.

Ludovit Cziria, Institute for Labour and Family Research

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