CROATIAN LABOR ACT

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• CROATIAN LABOR ACT

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Labor Act

• Entered in force on June 16, 1995
• Changes to the labor code, entered in force on
  June 8, 1995
• Changes to the labor code, entered in force on
  September 11, 1995
• Act on Changes and Supplements to the Labor code,
  entered in force on March 6, 2001
• Amendments to the labor code, entered in force on
  September 24, 2001
• Amendments to the labor code, entered in force on
  July 16, 2003

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Discrimination Prohibition

• Discrimination of persons looking for job and
  workers are regulated in a new way
• New discrimination basis is established sexual
  orientation
• Difference between direct and indirect
  discrimination
• Right to compensation in case of discrimination
• Employer has to prove that there was no
  discrimination

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Fixed-duration labour contract

• - Limitation of contract duration considering
  that the person works in the same position (3
  years)
• Consequences of signing of the fixed-duration
  labour contract opposing Labor Code stipulations
  - it is presumed that fixed-duration contact is
  the open-ended labour contract

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Protection of Workers Dignity

• Protection of workers dignity is regulated as a
  special protection from harassment and sexual
  harassment
• Employers obligations in the process of
  protection of workers dignity is regulated
• In case of legal proceedings, the employer has to
  prove that hes not guilty
• It is prohibited to discriminate workers who
  oppose any treatments or behavior endangering
  their dignity

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Notice Period Minimal Length

• Notice Periods
• - 2 weeks in case the worker has continously
  worked for the same employer for less than one
  year
• - 1 month for 1 year
• - 1 month 2 weeks for 2 years of work
• - 2 months for 5 years of work
• - 2 months and 2 weeks for 10 years of work
• - 3 months for 20 years of work
• - Has been implemented since January 1, 2004

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Identification of the lowest severance pay

• Workers with fixed-duration labour contracts are
  also entitled to severance pay
• 1/3 of the average monthly salary the worker had
  in three months prior to contract termination,
  for every full year of work of that employer
  (minimal amount)
• 6 average monthly salaries the worker had in
  three months prior to contract termination
  (maximal amount) if the law, collective
  agreement, company regulations or employment
  contract do not define this issue in a different
  manner
• has been implemented since January 1, 2004

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Development of Workers Surplus Aid Program

• Obligatory for an employer terminating at least
  20 employment contracts within 90 days,
  disregarding the size of the company
• Employer has to cooperate with the authorized
  employment service when developing this program

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Extension of Trade Union Representative
Authorities if There is no Workers Council in
the Company
Trade union representative is invested with all
the legally prescribed rights and obligations of
the workers council
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Criteria for Participation of Workers in the
Supervisory Board

• it is obligatory for a company to have one
  workers representative in its supervisory
  board if
• - there are more than
  200 employees in the company, and
• - it is a company with
  more than 25 of shares owned by the
  State, and in all public
  institutions, disregarding the number of
  employees

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Regulation of some Collective Bargaining
Prerequisites
The number of members and the composition of the
bargaining committee for collective bargaining
that trade unions have not agreed upon is decided
by the Economic and Social Council, i.e. minister
in charge for labor if there is no Economic and
Social Council founded (minimum 3, maximum 9
members)
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More Severe Penalties for and Extension of Fines
for Misdemeanors

• gradation of misdemeanors and misdemeanor
  penalties for employers
• minor misdemeanors fines in amount 10,000
  30, 000 kuna
• major misdemeanors fines in amount 31,000 60,
  000 kuna
• The gravest misdemeanors fines in amount 61,000
  100,000 kuna

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Be Flexible to Be Competitive

• Last changes in the LaborAct, instead of
  introducing flexibility improvement, almost
  completely eliminated it (except for part time
  employment and introduction of employment
  agencies, both changes with very limited results)
• Flexibility - Security
• in Croatia, the focus is still on job security

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CEA Suggestions of Changes to the Labor Act

• Why
• FLEXIBILISATION
• HARMONISATION
• SEPARATION OF THE SOCIAL MEASURES
• EFFICIENCY GROWTH

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CEA Suggestions of Changes to the Labor Code

• Eliminate limitations relating to duration of
  fixed-duration labour contracts,
• Eliminate formalities related to signing of the
  labour conctract (extremely complex obligatory
  contents of labour conctract
• Eliminate limitations of the duration of the
  trial period,
• Improve the possibilities of redistribution of
  working hours
• Eliminate forms of State influence on creation
  of salaries (establishment of the lowest salary,
  etc.)

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• Introduce reprensetativity threshold (e.g. 20 of
  the total number of employees) and if the trade
  union doesnt meet this criteria, it has no
  authority to start collective bargaining process,
• Eliminate stipulations on extended implementation
  of regulation included in the terminated
  collective agreement otherwise termination
  makes no sense,
• Give the same status to the rules on lock-out and
  the rules on strike,
• Reduce number and amount of misdemeanor fees (77
  - year 2000, 130 -year 2003) since it is not
  adequate for contractual employment agreements

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• Eliminate legal regulation of severance pays and
  leave that question to collective bargaining and
  individual employment agreements
• Obligation to issue a rulebook on labour, for
  employers with 50 and more workers