Labour Code: past, present and future

Academy of Romanian Scientists

Spring Session of Productivity Commission

In the last 8 years, from 2003- the year of adopting of new labour code, this was modified until now from more than 9 times, but the strongest modifications was made by OUG 55/2006 and Law 40/2011 who made more than 75% changes from the first version of Labour Code.

Is very true the fact that during last 8 years also society had change, we pass from economical increase to a depth financial crises who change the view of employers and also to employee.

The need of flexibility of rules was certain, financial crises show us the limits of actual rules, a part of representants of employers said in 2009 that the rigidity of Labour Code was one of the source of unemployment and bankruptcy.

Without a real audit of labour legislation we can’t say it is true or not, but the numbers show the highest rate of unemployment from 2003, until now was in march 2010, 8,6%. In March 2011 this was 6,6%, so was decrease 2 percent, before the new flexible rules to be apply. In same time in December 2008 the unemployment rate was 3,4%, so when the market had a flood of investments and the economy was at the highest level from the last 50 years the labour market wasn’t modified, to create new flexible form for new types of contracts of employment.

But now, during economical contraction the governments decided to offer more flexibility. New rules offer more dynamic vision of labour market, the individual contract of employment on indefinitely term remain at the level of declarations the base of labour market but  increasing the duration of individual contracts of employment on fixed term from 24 months to 36 months and even more (if is the need and parts accepted), increasing the trial period from 30 to 90 days for executive and from 90 days to 120 days for management who can be finished with only a simple notification will create a real problem on long terms.

Using financial crisis for cover the real problems of social dialogue at micro level, the new rules will deep this fracture of dialogue, who will create the precocity level of labour market with low wages, low possibility to negotiate rights, in terms of force, where all society will be losing: the employee will have lower level of life, will spend low on cheaper products, and all economy will suffer.

Flexicurity is a long debate concept who is based on principle of flexibility of market in same time with security of employee. Unfortunately, the Romanian govern decide only to do half of this, to flexibility of market.

In this new conditions Romania maybe will be attractive for new investors, but is important not only the quantity of this, also the quality of them. If we decide to be attractive for investors who had a short terms vision and the only priority is to can dismiss easily we need to think twice. Creating pools jobs in small’s communities who became easily volatile we just create a depth structural unemployment who will affect all region’s economy.

Without a long term vision of active actions of employment politics the new rules of flexibility Labour Code will became contra productive. We need a good prepared labour force, with know-how of new technologies, adaptable of new, for who the term of long life learning to don’t be only words. But for this we need a better school’s curriculum, adaptable of market needs: high schools for technologies and vocational schools.

Which motive I have to don’t agree with new rules? Are few important I think:

–    Increasing too much the trial period – you don’t need 3 months to observe if a worker aren’t professional prepared for a job, but you can use this motive to renounce at him after you solve a temporary problem who appear in your activity.

–    Temporary working agency was a chapter modified in detail, but aren’t totally harmonize with Directive 2008/14/CEE for example temporary working agency are in vision of Romanian legislation only company not also physical person like in Directive.

–    The rules for collective dismiss aren’t used also for employee from public sector, this will create discriminations.

–    After a collective dismissal was abrogating the rule from which you can’t hire a new person minimum 9 months;

–    The reference period for extra time are increase from 3 months to 4 months, for who the maximal period of extra time can be until 48 hours/ labour week;

–    One minimum fraction of holiday can be at least 10 days from 15 days until now;

–    The burden of proof is now in the field of the plugged, which will aggravate the situation of employee, until now this was the burden of employer;

–    All collective bargaining agreement will be finish from the power of low at 31.12.2011, this act are a intruding of parts agreement.

Are also good parts in these new rules:

–    The fight against black labour are increase, even apply the penalties also to workers will decrease the numbers of complains and can create a bigger problems for the one who needs to pay 10 minimum wages, when sure they accept black market only for lack of alternatives.

–    Recurrence of graduate training;

–    Creating the possibility to reduce the working week at 4 days during contracting activities;

–    Increasing the notice period from 15 days to 20 days for executive and from 30 days to 45 days for management;

–    Increasing the night growth from 15% to 25%;

–    Recognize the all rights during trainings.

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