The Amendment of the Labour Code adopted by the Parliament

Impulse for this amendment of the Labour Code was provided by employers, mostly from automotive industry. In their complaints, employers drew attention to an endangered group of employees whose employment for a definite period shall terminate soon and its extension or renegotiation is not possible due to the limiting regulation of the Labour Code on maximum duration of the employment relationship and maximum number of its extension and possibility to repeatedly agree on the employment relationship of the same type. Employers explained that in this economically difficult period, they cannot employ such employees for an indefinite period and they will have to terminate employment relationship with these employees. 

The amendment considers these complaints and enshrines the possibility to extend and repeatedly agree on employment a definite period beyond standard legal framework contained in Section 48 of the Labour Code.

Pursuant to the Section 48 Subsection 2 of the Labour Code: “Employment for a definite period of time may be agreed for no more than two years. Employment for a definite period of time may be extended or repeatedly agreed  no more than twice within a period of two years.”

The amendment also adds new transitional provision Section 252o into the Labour Code that allows to:

• extend employment relationship concluded for a definite period, which shall terminate from the effective date of the amendment until the expiry date of 2 months period after recall of emergency situation declared in the connection to spread of COVID-19 , for at least one time during one year without any limitation by the regulation stated in Section 48 Subsection 2 of the Labour Code. 
• repeatedly conclude employment relationship for definite period, which terminated in the time between declaration of the emergency situation (12 March 2020) and the date of expiry of the two-month period after the emergency situation has been lifted. Such employment relationship can be repeatedly concluded one more time for one year at most, without application of limitation stated in Section 48 Subsection 2 of the Labour Code. The employment relationship shall be repeatedly concluded no later that two months after the emergency situation was lifted. 

In the case the employee representatives operate at the employer (i.e. trade unions, employee council or employee trustee), the employer is obliged to negotiate with them any extended or repeatedly agreed employment relationship for a definite period pursuant the Section 252o of the Labour Code. If the employer fails to negotiate it with the employee representatives, the extended or repeatedly agreed employment relationship remains valid, however it is considered to be concluded for indefinite period. In the case the employee representatives do not operate at the employer, the employer is not obliged to negotiate and an agreement with an employee is sufficent.

Examples:

• The employment for a definite period shall terminate as of 30 June 2020 and pursuant to the Section 48 Subsection 2 of the Labour Code it cannot be extended e.g. because it would exceed two years or would be extended two times. 

On basis of the amendment of the Labour Code, the employer and the employee can agree to amend the employment agreement and extend originally agreed definite period. The employment relationship may be extended until 30 June 2021. The amendment to the employment agreement on extension of employment relationship have to be concluded before end of the agreed definite period. 

• The employment for a definite period terminated on 31 May 2020. Pursuant to the Section 48 Subsection 2 of the Labour Code, the employer and the employee cannot agree to extend the employment relationship or repeatedly agree on employment relationship for a definite period, e.g. because the previous employment relationship for a definite period has already lasted more than two years or which has been extended or repeatedly agreed two times already.

As of the effect of this amendment, but not later than two months after recall of the emergency situation, the employer can repeatedly conclude employment relationship with the employee for definite period. The employment for a definite period can be repeatedly agreed for a maximum of one year. This repeatedly agreed employment relationship for a definite period may commence even after two months from the recall of the emergency situation. It is necessary that contractual parties conclude an employment agreement within the two month period. 

To conclude, please note that Labour Code in its Section 48 Subsection 4 and Subsection 6 regulates exceptional cases, in which it is possible to conclude employment relationship for a definite period of time above the standard range stated in Section 48 Subsection 2 of Labour Code. Those exceptions are not affected by the amendment of the Labour Code. At the same time, the amendment shall not be applicable in relation to the employees working through temporary employment agency.