What will bring the long-expected Agency Employment Act?

February 21, 2019

What will bring the long-expected Agency Employment Act?

February 21, 2019

Miloš Velimirović

Miloš Velimirović

Partner

Kristina Pavlović

Kristina Pavlović

Associate

Although in 2013 Serbia ratified the ILO’ Private Employment Agencies Convention no. 181, the full implementation of this Convention has been awaited.  It is for sure that Serbia’s accession to the European Union and harmonization with acquis communautaire has speeded up this process.  This is due to fact that one of the main steps on the way to joining EU is to accept and implement its legal framework, and, inter alia, harmonize Serbian employment regulations with EU Directives.  Hence, Serbian Ministry for Labor and Employment (“Ministry”) has prepared the Proposal of the Agency Employment Act (“Zakon o agencijskom zapošljavanju”), in order to implement EU Directive no. 2008/104/EC which regulates temporary agency work.

The Proposal of Agency Employment Act

So far, the facts are the following: on 1 November 2018 Ministry for Labor and Employment has published the Proposal of the Agency Employment Act for the public debate.  During the course of the debate, the main criticism came from the trade union representatives and employment agencies.  The first expressed dissatisfaction because the Proposal excludes to protect the workers engaged within youth and student cooperatives and outsourcing agency which provide services such as security and cleaning services.  These workers are usually engaged through the temporary and occasional work contract (“ugovor o privremenim i povremenim poslovima”), and they do not have rights arising from the employment (e.g. holiday leave, benefits, and other payments etc.)

On the other hand, employment agencies are concerned regarding the limitation stipulated by the Act – namely, up to 10% of employees can be assigned by the agency comparing the total number of employees employed with an employer to whom the employees are leased. Only in case, the Ministry gives prior approval, this number can be raised up to 30%, although the Act does not determine under which ground the Ministry shall approve such increase.

Protection of “leased employees”

Besides the expressed criticism, this Act needs to be regarded as an important step forward to the protection of the employees leased by the agency. First of all, its provisions determine that these employees shall have the same work conditions as the ”regular employee”.  This means that the leased employees are entitled to equal treatment as the other employees engaged by the employer i.e. salary, breaks, holiday leave, health protection, and safety at the workplace.  Furthermore, leased employees shall not pay a fee to work agency – the Act stipulates that the fee shall be borne by the employer. That said, such provisions improve the position of the leased employees since they used to have a minimum wage and obligation to pay a fee for providing the job to the agency.

However, it is expected that this Proposal will have some amendments, bearing in mind that it was returned to Ministry upon the completion of public debate.  It remains to be seen how the final version of the Act will look like but having in mind the efforts that trade union representatives have done so far, the provisions protecting leased employees will remain the same as in the Proposal.

This text is for informational purposes only and should not be considered legal advice. Should you require any additional information, feel free to contact us.

Contact:

Miloš Velimirović, Partner
milos.velimirovic@sog.rs

Kristina Pavlović, Associate
kristina.pavlovic@sog.rs

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