In the Official Gazette of Romania dated November 14, 2024, Law no. 283 of November 13, 2024, concerning the amendment and completion of certain legislative acts to establish adequate minimum salaries (“Law 283/2024“), was published. This law introduces adjustments and additions to Law no. 53/2003 – the Labor Code.
1. Legal context
Law 283/2024 was adopted in the context of the need to establish a framework at the European Union level aimed at ensuring both the setting of minimum salaries at an adequate level and employees’ access to minimum salary protection, either in the form of a statutory minimum salary or through salaries established by collective agreements, in accordance with the provisions of Directive (EU) 2022/2041 (the “Directive”), whose deadline for transposition into national legislation was set for November 15, 2024.
2. Reasons for the adoption of Law 283/2024
The provisions of the Labor Code have been supplemented by this law in order to establish measures to ensure the implementation of an action plan to promote collective bargaining.
These measures are in line with the Directive’s objective of supporting collective bargaining to increase employees’ access to collectively negotiated pay rights and collective bargaining protection.
In addition, the Labor Code ensures the application of the Directive’s provisions to all categories of employees, regardless of the type of legal employment relationship under which they perform their activity. This includes employment relationships, special employment relationships (such as mandate agrements, management agreements, sports activity agreements, etc.), or public service relationships, by defining the concepts of “legal employment relationship” and “employer”.
3. The amendments concern the following:
a) Employment relationships not based on an individual employment agreement, (such as management/mandate agreements) regulated by special legislative acts, will be remunerated with the gross national minimum basic salary guaranteed in payment;
b) The gross minimum basic salary is guaranteed to all employees and represents the minimum amount to which the employee is entitled for the work performed, as established by a normative act or the applicable collective labor agreement;
c) The national gross minimum basic salary is established annually by a Government Decision, applicable from January 1 of the following year, and is periodically updated, once a year, after consulting trade union and employer confederations. In this context, a procedure has been included in the Labor Code to introduce a new mechanism for evaluating by the Ministry of Labor and Social Solidarity the adequacy of the national gross minimum basic salary guaranteed in payment, considering its proportion in the average gross salary;
d) From now on, the category of labor disputes also includes conflicts based on employment relationships that are not grounded in an individual employment agreement, but are regulated by special laws;
e) The contravention penalty for failing to comply with the provisions regarding the guarantee of payment of the minimum basic salary has been increased from 300-2,000 lei to 3,000-5,000 lei for each person for whom non-compliance is established, without exceeding a cumulative amount of 200,000 lei;
4. Recommendations
We recommend revising and updating, starting January 1, 2025, the individual employment agreements as well as the special agreements under which individuals carry out their activities in employment relationships (such as mandate or management contracts), in accordance with legal provisions regarding the compliance with the national gross minimum basic salary.