The Parliament has approved a legislative proposal concerning fixed-term employment contracts of up to one year without a justified reason. At the same time, amendments to the Employment Contracts Act regarding the layoff notice period and the employer’s reemployment obligation were also approved.
The date of entry into force of the changes has not yet been confirmed.
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1. Fixed-term employment without a justified reason
Current situation:
Under the Employment Contracts Act, employment contracts have generally been valid indefinitely. Only in special cases, and for a justified reason, could a contract be concluded for a fixed term. Exceptions have included, for example, project-based or seasonal work, hiring a long-term unemployed person for a fixed term, temporary replacement work, or the employee’s own request for a fixed-term contract.
Changes:
A justified reason for a fixed-term contract will no longer be required if it is the first employment relationship between the employer and the employee within the five years preceding the conclusion of the contract. In such cases, the employer is not required to assess the permanence of the need for labor.
The employee must be informed in writing that the fixed-term contract has been concluded without a justified reason.
The maximum duration of such a fixed-term contract is one year. Only one such fixed-term contract is allowed, and the one-year period cannot be divided into several shorter contracts.
A fixed-term contract concluded without a justified reason may be terminated by either party in the same way as an indefinite contract after it has lasted at least six months.
Before the expiry of the fixed term, the employer must provide a reasoned statement on the possibility of continuing the employment relationship either as an indefinite contract or as a fixed-term contract with a justified reason.
In addition, the employer must offer work if, at the end of the fixed-term relationship, they are considering hiring employees for the same or similar tasks. The duration of this post-employment obligation to offer work corresponds to one third of the length of the expired employment relationship. The employer may offer the job to another person only if the fixed-term employee has not responded to the job offer within two weeks of it being sent.
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2. Layoff notice period shortened
Current situation:
The employer must notify the employee of a layoff no later than 14 days before the layoff begins. The notice must be given personally, by letter, or electronically.
Changes:
The layoff notice period will be shortened to seven days.
If a collective agreement provides for a longer notice period than the law, it will be possible to agree at the workplace level to deviate from the collective agreement provision.
A presumption of receipt applies to layoff notices sent by letter or electronically. Such notice is considered to have been received by the employee no later than the seventh day after it was sent, unless the employee has been on annual leave or working time compensation leave.
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3. Reemployment obligation
The reemployment obligation concerning employees dismissed for production-related or financial reasons will apply only to employers with at least 50 employees.
We advise our clients on all matters related to employment relationships.
