Employment contracts in Romania

Minimum requirements

As a rule, the individual employment agreement is an unlimited (open-ended) term contract. However, the individual employment contract may also be for a fixed-term. Employees can also be hired to perform work based on a part-time agreement, that can also be open-ended or fixed-term.

According to the Romanian Labour Code, any kind of individual employment contract must be concluded in writing, in the Romanian language and on the basis of both parties’ consent (employer and employee). Before the beginning of the employment relationship, the employer has the obligation to conclude the individual employment contract and register it with the employees’ electronic program (ReviSal).

Prior to the conclusion or amendment of the individual employment contract, the employer has the obligation to inform the person selected for employment or the employee, about the essential clauses to be introduced in the contract or to be amended. The individual employment contract shall be concluded after the employer performs a preliminary check of the personal and professional abilities of the applicant. Information about the work performed and the duration of the work, from the former employer may be requested only after having first informed the applicant.

A medical certificate upon hiring an applicant, represents a mandatory requirement for concluding an individual employment contract, in order to determine whether the applicant is fit for the job. In case the medical certificate is missing, the contract is null and void.

The individual employment contract must contain the following provisions:

• the identity of the parties;
• the place of work or in the absence of a fixed workplace information on if and how the employer will ensure transportation for the employee to and from the different places where work ig going to be perfomed;
• the headquarters or domicile of the employer;
• the position/occupation according to the Romanian Classification of Occupations or other regulatory documents and the job description;
• the professional activity evaluation criteria applied by the employer;
• the job-specific risks;
• the employment start date;
• the expiration date, in the case of a limited duration or temporary employment contract and the specific situation that requires a fixed-term agreement;
• the annual entitlement to paid holiday leave;
• the conditions and the length of the notice period (both dismissal and resignation);
• the remuneration and all the components of the remuneration (such as bonuses) the method of payment and the payment frequency;
• the working time, expressed in hours per day and hours per week, the conditions under which overtime is to be compensated and, if the case the conditions under which work in shifts is organized internally;
• the reference to the collective labour agreement governing the working conditions of the employee;
• the length and the conditions of the probationary period, if the case;
• the procedure of usage of the electronic signature;
• the rights and the conditions under which professional training is provided to the employee;
• other non-mandatory benefits that the employer grnts to the employee such as additional medical insurance, private pension contributions etc.

Besides the essential clauses, the parties may also negotiate and include other specific clauses in the individual employment contract, such as: a) professional training; b) non-compete clause; c) mobility clause; d) confidentiality clause. Non-compete clauses are exclusively paid clauses and are limited to a period of maximum 2 years.

In addition to the general requirements, part-time contracts must state the following: a) the working time and the working schedule; b) cases when the working schedule may be amended; c) overtime work prohibition, except for acts of God or other urgent works intended to prevent the accidents or to remove their consequences.

Fixed-term contracts may be concluded only for the limited cases provided by the Labour Code that requires that the agreement states essential information on the specific case that justifies having a fixed-term agreement and the duration of the contract.

When negotiating the employment contract, both the employer and the employee can be assisted by third party specialists, including lawyers.

Fixed-term/Open-ended Contracts

Open-ended contracts are the rule under Romanian law. The fixed term contracts may be concluded only for the limited cases provided by the Labour Code and must contain the general imperative information plus the duration of the contract. The Labour Code states that the same two parties cannot sign more than 3 consecutive fixed-term contracts. Also the fixed-term contracts and any extensions cannot exceed a period of 36 months. After this period the contract is to be considered an open-ended contract.

Trial Period

Employment contracts – concluded both for a fixed or open-ended term, may contain a probationary period clause.

In order to verify the skills of the employee, the parties may agree upon a probationary period, mentioned within the individual employment contract, of a maximum 90 calendar days for standard positions and a maximum 120 calendar days for managerial positions. With respect to disabled persons, the probationary period will be of a maximum 30 calendar days.

During or before the end of the probationary period, the individual employment contract may cease based on written notification, without motivation or prior notice, due to the initiative of the employer or employee.

Notice Period

The individual employment contract may be terminated by the employer or by the employee. In case the contract terminates due to the employer’s decision, with the exception of 1) dismissal for disciplinary reasons or 2) if the employee is under arrest or house arrest for more than 30 days, the employee is entitled to a notice period of no less than 20 working days.

In case the contract terminates due to the employee’s decision to resign, he has the obligation to respect a notice period of 1) no more than 20 working days for standard positions and 2) no more than 45 working days for managerial positions. The employer has the right to waive the notice period and to agree to terminate the contract due to the employee’s will, at any moment before the end of the notice period. Employees can resign without observing the notice period if the employer fails to comply with one or more of its obligations.