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02. Employment Contracts

Minimum requirements

When starting an employment relationship, an employee undertakes to perform work of a specific kind to the benefit of the employer and under the employer’s management as well as at a place and for a time set by the employer, whereas the employer undertakes to employ the employee for remuneration. Employment under such conditions is employment under an employment relation regardless of the name of the contract the parties concluded. The Labour Code distinguishes three types of employment contracts, including an employment contract for a trial period, an employment contract for a fixed term and an employment contract for an unlimited term.

Regardless of its type, the employment contract should define the parties to it, the contract’s type, the date of its conclusion, and the conditions of work and remuneration, in particular the kind of work, the venue of work, the remuneration for work reflecting the type of work performed with a specification of the components of the pay, working time, and the date of commencement of work. The employment contract is concluded in writing. If this form has not been preserved, then at the latest on the day of starting the work by the employee, the employer should confirm in writing for the employee the conditions as regards the parties to the contract, its type and terms and conditions. Additionally, the employer is obligated to provide the employee with an information on detailed conditions of work and pay, as indicated in the Labour Code, within seven days from commencement of work, in paper or electronic form.

All changes to the employment contract require a written form. It is also possible to conclude with an employee a part-time employment contract. Such employment may not, however, result in less advantageous employment terms and conditions in comparison to full time employees who perform the same of similar work.

Fixed-term/Open-ended Contracts

Unlimited-term contracts are the most common. Recently, however, there is a trend to depart from this form of employment toward fixed-term contracts or agreements in civil law. A fixed-term employment contract is concluded either until an agreed calendar date or until the date, which can be defined by a fact, which will occur in the future.

The period of employment under a fixed-term contract, as well as the total period of employment under fixed-term contracts concluded between the same parties of the employment relationship, may not exceed 33 months, and the total number of the contracts may not exceed three. Moreover if the term of employment under a contract of employment for a fixed-term is longer than the 33 months, or if the number of concluded contracts is higher than three, it is understood that the employee, accordingly as of the day following the lapse of the 33-month period or the date of conclusion of the fourth fixed-term contract, is hired under a contract of employment for an indefinite term. Additionally the agreement between the parties, during the term of a fixed-term contract, upon a longer period of performance of work under the contract, is understood as a conclusion, as of the day following the day of contract termination, of a new contract of employment for an indefinite term. There are four exemptions, when fixed-term employment contracts can exceed the period/number mentioned above:

  • for replacement for an employee during their justified absence from work;
  • for performance of occasional or seasonal work;
  • for performance of work for a term of office;
  • if the employer indicates objective reasons attributable to the employer.

The relevant district labour inspector must be notified in writing by the employer in case of conclusion of a fixed-term employment contract, in the event indicated in point 4 above.

Trial Period

An employment contract for a trial period is concluded in the event when, prior to making a decision on initiating an employment relation, one or both parties thereto wish to get acquainted with the conditions of the future execution of mutual rights and obligations at a workplace. It is up to the parties to conclude such an agreement. The maximum length of the trial period depends on the length of future planned employment. An employment contract for a trial period shall be concluded for a period not exceeding 1 month – in the case of an intention to conclude a fixed-term employment contract of less than 6 months; 2 months – in the case of an intention to conclude a fixed-term employment contract of at least 6 months and less than 12 months; and 3 months – in the case of an intention to conclude a fixed-term employment contract of at least 12 months or an indefinite-term employment contract. The parties may extend the probationary period in the employment contract once, but for no more than one month if this is justified by the nature of the work. A trial employment contract may not last longer than 3 months. In addition, the parties may agree in the probationary employment contract that the contract shall be extended by the period of the holiday leave, as well as by the period of the employee’s other excused absence from work if such absences occur.

After the trial period, the parties are not allowed to conclude another contract for a trial period except in the situation where the employee is hired to perform a different type of work.

In principle, an employee can be employed at the same employer under such a contract only once.

Notice Period

Requiring a notice period in an employment contract is acceptable if provisions of law state so. The Labour Code allows for a notice period in a contract concluded for a trial period, for a fixed-term and for an unlimited term. The notice period to an employment contract concluded for a trial period depends on the period for which the contract was concluded and the notice period in an employment contract concluded for fixed or unlimited term depends on how long the employee’s length of service was. The notice period may vary from two weeks, one month, or three months for both fixed and unlimited terms; and 3 working days, 1 week or 2 weeks for contracts wherein the trial period is concluded.

In principle, it is possible, by way of normative agreements, to introduce longer notice periods than the ones provided for in the Labour Code. However, the provisions of the employment contract or normative agreement may not be less advantageous than the provisions required by the labour law. Therefore, it may happen that, in a specific factual state, longer notice periods will be considered as disadvantageous and, as such, shall not be enforced.

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