Labour and Employment Comparative Guide

1 Legal framework

1.1 Are there statutory sources of labour and employment law?

Out of the laws regulating employment-related issues in Romania, the most important are:

• the Romanian Constitution;
• the Labour Code (Law 53/2003); and
• the Law on Social Dialogue (Law 367/2022).

In addition, other laws, regulations and decisions govern specific employment-related aspects, such as:

• occupational health and safety;
• teleworking;
• prevention of discrimination;
• equal treatment between women and men;
• information and consultation of employees;
• protection of employees' rights in the context of business transfers; and
• medical leave.

1.2 Is there a contractual system that operates in parallel, or in addition to, the statutory sources?

Yes – the applicable legislation recognises the possibility for social dialogue partners (employers and employees, duly represented, as per the law) to negotiate and to conclude collective bargaining agreements. Collective bargaining agreements may be concluded at various levels, including:

• company;
• group of companies;
• economic sector; and
• national.

At present, no collective bargaining agreement has been concluded at the national level.

Collective bargaining agreements can establish rights and obligations only within the limits and under the conditions provided by law.

If collective bargaining agreements are concluded and are applicable to an employer, individual employment contracts cannot contain clauses that provide for weaker rights than those set forth under the applicable collective bargaining agreements.

1.3 Are employment contracts commonly used at all levels? If so, what types of contracts are used and how are they created? Must they be in writing must they include specific information? Are implied clauses allowed?

Irrespective of the position held, individual employment contracts are mandatory. Mandate/management agreements may be concluded by directors or members of other corporate bodies and are not governed by employment law.

As a rule, individual employment contracts are concluded for an unlimited term; only in those cases that are expressly provided by law may an individual employment contract be concluded for a fixed-term period.

An individual employment contract must be concluded in writing, in Romanian, at least one day prior to the employee starting work.

The parties must sign the individual employment contract and any addenda thereto:

• by wet signature; or
• by electronic signature – either:
• • advanced electronic signature; or
  • qualified electronic signature.

The minimum content of the individual employment contract is expressly specified by law. However, the parties may negotiate and include additional clauses in the individual employment contract, to the extent that such clauses are in line with the applicable laws.

2 Employment rights and representations

2.1 What, if any, are the rights to parental leave, at either a national or local level?

The Romanian legal system recognises various rights for employees who are or will become parents, such as:

• maternity leave;
• paternal leave;
• childcare leave; and
• accommodation leave.

Such leave is:

• applicable at the national level; and
• granted by the state.

Employers must take the necessary measures to ensure that employees' legal rights are duly observed.

2.2 How long does it last and what benefits are given during this time?

The duration of each type of leave mentioned in question 2.1 is expressly specified by the relevant laws:

• Maternity leave lasts for 126 calendar days;
• Paternity leave is granted for 10 working days (with the possibility of an additional five working days where certain legal requirements are met);
• Childcare leave is granted until the child reaches the age of two (or three in the case of a child with disability); and
• Accommodation leave is for two years.

During the period of leave, the employee benefits from an allowance in the amount established under the law. Depending on the type and nature of the leave, this allowance will be paid by either the state or the employer.

2.3 Are trade unions recognised and what rights do they have?

Trade unions are recognised by law and, in their capacity as social dialogue partners, have various rights and prerogatives, such as:

• the right to participate in the negotiation and conclusion of collective bargaining agreements;
• the right to defend the rights of their members (including the right to submit a legal action in court);
• the right to submit legislative proposals to the competent public authorities;
• the right to participate in meetings of the board of directors or a similar body to discuss professional, economic and social issues with an impact on employees; and
• the right to participate in the information and consultation processes organised at the employer level on various topics (eg, business transfers, collective dismissals).

Trade unions are legal entities that are established and function in accordance with the law and may also establish themselves as federations and confederations.

Given that the establishment of a trade union implies the need to follow a more formal procedure (including before the court), at the company level, employees are usually represented by elected employees' representatives.

2.4 How are data protection rules applied in the workforce and how does this affect employees' privacy rights?

As in all other EU member states, the General Data Protection Regulation (GDPR) applies in Romania; hence, the obligations arising from the GDPR must be fully observed by employers, including those set out in the European Data Protection Board's guidelines and opinions on the matter. Among other things, these include:

• identifying the applicable legal ground for processing personal data in the workplace;
• complying with all processing principles;
• implementing adequate security measures against unlawful disclosure and access to employees' personal data;
• transferring employees' personal data outside the European Union/European Economic Area only based on adequate safeguards; and
• ensuring that employees can exercise their privacy rights.

In addition, in accordance with Law 190/2018 on the GDPR implementing measures, certain particularities must be observed by employers that install electronic communication monitoring systems and/or video surveillance systems in the workplace based on legitimate interests. In such cases, the employer must:

• be pursuing duly justified legitimate interests that prevail over the interests, rights and freedoms of the data subjects;
• inform employees in advance, thoroughly and clearly;
• consult with the trade union or employees' representatives in advance;
• ensure that other less intrusive measures have been proven ineffective to achieve its intended purpose; and
• ensure that the storage duration is proportionate to the purpose of processing; except in cases expressly regulated by law or duly justified ones, the storage duration should not exceed 30 days.

Moreover, Law 190/2018 expressly provides that employee training must be provided where a national identification number (eg, personal numerical code; series and number of an identity document; passport number; driver's licence number; social health insurance number) is processed for the purpose of fulfilling the legitimate interests of the data controller (or of the employer, in relation to a national identification number of its employee). In practice, employee training is one of the corrective measures that are usually imposed by the Romanian Data Protection Authority after investigating security breaches or other irregularities to ensure compliance with the data protection requirements.

In the case of violations of GDPR-related provisions, including Law 190/2018, employers may face fines of up to €20 million or 4% of their annual turnover. In practice, to date, the Romanian Data Protection Authority has applied lower sanctions than those imposed by other EU regulatory authorities, as it prioritises prevention over sanctioning.

2.5 Are contingent worker arrangements specifically regulated?

Contingent worker arrangements are not regulated as such under national law.

In accordance with the Labour Code, workers can be employed on a temporary basis under arrangements such as the following:

• Fixed-term individual employment contract: This may be concluded exceptionally in certain cases expressly provided by the law, such as:
• • to replace an employee where the employment contract has been suspended;
  • in case of an increase and/or temporary change in the employer's activity; or
  • for a specific project.
• Temporary employment contract: This implies the performance of work by a temporary employee pursuant to a temporary employment contract concluded with an authorised work agent, which sends the employee in question to another entity (the user) for a specific period, not to exceed 36 months. Thus, work through a temporary work agent implies two separate agreements, each of which has mandatory content:
• • one concluded between the temporary work agent and the user; and
  • the other concluded between the temporary work agent and the temporary employee.

Other mechanisms may be adopted by employers that have a temporary need for labour, such as:

• use of posted employees; and
• use of day workers (permitted solely in specific sectors of activity).

3 Employment benefits

3.1 Is there a national minimum wage that must be adhered to?

Under Romanian law, employers cannot negotiate and establish in individual employment contracts/collective bargaining agreements base salaries that are lower than the national minimum gross base salary.

The national minimum gross base salary guaranteed for payment is established annually under a government decision and applies from 1 January of the following year. It is updated annually following consultation with trade unions and employers' organisations that are representative at a national level. The level of the national minimum gross base salary guaranteed for payment is established and updated based on a specific procedure provided for by law.

An employee may receive a salary that is equal to the minimum gross base salary guaranteed for payment at the national level solely for a period of up to 24 months after the date of signing of the individual employment contract.

Currently, the national minimum gross base salary guaranteed for payment is RON 4,050.

Without prejudice to the above, the law also provides for a differentiated level of the national minimum gross base salary guaranteed for payment for employees working in the construction sector. The current national minimum gross base salary guaranteed for payment is RON 4,582.

3.2 Is there an entitlement to payment for overtime?

Overtime that is worked in accordance with the law (ie, at the employer's request and with the employee's consent) must be compensated by paid time off granted within the 90 days following performance of the work. If it is not possible to provide such time off within this 90-day period, overtime pay must be paid to the employee by adding extra pay to their salary according to the duration of the overtime. This extra pay:

• is established by negotiation under the collective bargaining agreement/individual employment contract; and
• cannot be lower than 75% of the base salary.

At times when an employer's activities are reduced, the employer can grant employees paid time off, from which overtime to be performed within the next 12 months can be compensated.

3.3 Is there an entitlement to annual leave? If so, what is the minimum that employees are entitled to receive?

One of the main legal rights of employees is the right to paid annual leave. This right cannot be subject to any assignment, waiver or limitation.

The minimum duration of annual leave is 20 working days (excluding public holidays and other paid days off granted to employees as per the law and the applicable collective bargaining agreement, where applicable). The actual duration of the annual leave is agreed upon by the parties and specified in the individual employment agreement.

Also, specific categories of employees (eg, persons with disability) are entitled to at least three supplementary working days of leave, although additional days of leave may be established under the collective bargaining agreement.

Annual leave must be taken each year. If an employee cannot take some or all of the annual leave to which they are entitled in the relevant calendar year due to justified reasons, employers must grant this leave within an 18-month timeframe starting from the year following that in which the right to annual leave arose.

3.4 Is there a requirement to provide sick leave? If so, what is the minimum that employees are entitled to receive?

In case of a temporary work incapacity, employees benefit from medical leave and a corresponding allowance, to be granted in accordance with the law.

The duration of medical leave must be established by a competent physician who establishes the need for medical leave. As a matter of principle, employees are entitled to medical leave for up to 183 days, provided that the legal requirements are met. In case of more severe or long-term illness, medical leave can be extended as long as mandatory authorisation is obtained.

As the individual employment contract is suspended during the temporary work incapacity (and thus no salary rights are granted for this period), employees are entitled to a medical leave allowance that is based on the type of sickness for which the medical leave has been granted.

A payment mechanism is provided for by law for the medical leave allowance. Thus, in principle:

• the first five days of medical leave are paid by the employer; and
• thereafter, the medical leave allowance is paid by the employer but is reimbursed by the state.

3.5 Is there a statutory retirement age? If so, what is it?

In Romania, according to the Pension Law (Law 360/2023), the standard retirement age is 65, for both men and women. As far as women are concerned, the above statutory retirement age will be reached in time, depending on their month and year of birth.

Currently, the minimum retirement contribution in Romania is 15 years for both men and women.

4 Discrimination and harassment

4.1 What actions are classified as unlawfully discriminatory?

Discrimination is widely regulated under Romanian law. Pursuant to the Labour Code, several acts are deemed as discrimination, such as the following:

• Exclusion, distinction, restriction or preference based on one or several criteria (eg, sexual orientation, genetic characteristics, age, race, colour, political option, disability, family situation or responsibility) that has as its purpose or effect the non-granting, restriction or removal of recognition, use or exercise of the rights provided under the labour legislation constitutes direct discrimination.
• Any provision, action, criterion or practice that is apparently neutral but has as its effect the disadvantage of a person towards another person based on one of the above grounds constitutes indirect discrimination, except where:
• • the provision, action, criterion or practice is objectively justified through a legitimate purpose; and
  • the manner of achieving such purpose is proportionate, adequate and necessary.
• Any act or deed of discrimination committed against a person who, although not part of a category of persons identified according to the criteria above, is associated or presumed to be associated with one or more persons belonging to such category of persons constitutes discrimination by association.
• Any less favourable treatment applied to an employee on the grounds of requesting or exercising certain rights represents discrimination.

4.2 Are there specified groups or classifications entitled to protection?

Additional measures of protection are provided for certain employees, such as:

• pregnant employees/employees who have recently given birth to a child; and
• employees with a disability.

4.3 What protections are employed against discrimination in the workforce?

Employment relationships are governed by the principle of equal treatment for all employees and employers. Among other things, employees have the right to benefit from respect of dignity and conscience, without discrimination.

The applicable laws regulate:

• actions that are considered to constitute discrimination;
• the sanctions that may be applied where it is ascertained that an act of discrimination was committed; and
• the measures that may be taken against a person for committing an act of discrimination.

Specific obligations apply to employers, which must ensure that they:

• establish and maintain a working environment that is free from discrimination; and
• implement the necessary tools to:
• • promptly acknowledge and investigate a discrimination-related claim; and
  • take the necessary remedial actions.

Furthermore, the law recognises the employee's right:

• to make an internal complaint regarding a potential act of discrimination; and
• to submit a complaint to the competent authorities and/or with the courts.

4.4 How is a discrimination claim processed?

A discrimination claim made under an internal procedure must be processed by strictly following the relevant procedure.

If the procedure is pursued before the National Council for Combating Discrimination (NCCD) within the legal timeframe of one year as from the date on which the act was committed or the interested person became aware of its commission, the relevant legal steps must be followed. The complaint must thus be filed in strict observance these requirements (including the submission of specific information).

The NCCD will:

• issue a decision on the complaint within 90 days; and
• communicate its decision to the parties within 30 days (the decision is effective as from the date of its communication).

The NCCD's decision may be challenged in court within 15 days of its communication.

Without prejudice to the above, a person who feels that they have been discriminated against may also file a legal action in court. This legal action is exempt from stamp duty and is not conditional upon filing a complaint with NCCD, although it may be submitted within three years of the date on which the act was committed or the interested person became aware of its commission. The case will be judged through the mandatory summoning of the NCCD.

Any means of evidence may be invoked in court, including audio and video recordings, further to the strict observance of constitutional rights.

4.5 What remedies are available?

If, after pursing an investigation according to its internal rules and regulations, an employer ascertains that an act of discrimination has been committed by one of its employees, the employer may apply disciplinary sanctions accordingly (including the disciplinary termination of the individual employment contract).

If the NCCD ascertains that an act of discrimination was committed, it may order various remedial actions, including:

• the imposition of a fine on the employer;
• the imposition of a fine on the person responsible for the discrimination; and
• publication of a summary of its decision in the mass media.

If, following a legal dispute, the court ascertains the existence of discrimination, it may order various remedial actions, including:

• the award of moral or material damages to the person who experienced the discrimination for the prejudice caused due to the act of discrimination; and
• publication of a summary of the court's ruling in the mass media.

4.6 What protections and remedies are available against harassment, bullying and retaliation/victimisation?

Romanian law broadly regulates the situations that are deemed to constitute:

• harassment;
• psychological harassment;
• sexual harassment;
• harassment in the workplace; and
• victimisation.

Any such behaviour is strictly prohibited. Failure to observe the legal provisions is punishable by fines (the amount of which will depend on the nature and specifics of the committed act). Employees can also address their claims to the competent authorities and the courts of justice.

Apart from their general obligation to ensure the observance of their employees' legal rights, employers also have specific obligations to ensure that the principle of equal treatment is observed, including the obligation to:

• adopt anti-harassment policies and procedures and provide related training to employees;
• establish a channel through which employees can report any harmful acts that may constitute harassment (of any kind);
• promptly investigate such claims; and
• take the necessary measures to address the harassment.

Remedial actions may include, among other things:

• the imposition of disciplinary sanctions on the harasser;
• the imposition of fines on the harasser and/or the employer;
• the imposition of other measures on the employer (eg, to pay for the employee's psychological counselling); and
• payment of damages.

5 Dismissals and terminations

5.1 Must a valid reason be given to lawfully terminate an employment contract?

Under the Labour Code, an employee is entitled not to justify their decision to terminate the employment relationship when resigning from their job. However, if the employer is terminating the individual employment agreement – for reasons either imputable or not imputable to the employee – this decision must be:

• grounded on valid reasons; and
• made in strict observance of the law and the applicable procedures.

Reasons for which employees may be dismissed that are imputable to them may include:

• disciplinary reasons;
• professional suitability; or
• physical and/or mental incapacity which prevents them from discharging their duties.

In such cases, there must always be evidence underpinning such decision, such as:

• the commission of disciplinary misconducts;
• poor professional results; or
• a medical certificate confirming the employee's incapacity.

Similarly, the employer may decide to dismiss an employee for reasons that are not imputable to such employee – for example, due to the cancellation of their position (individual or collective layoffs). In such case, the dismissal is possible only if it has a real and serious cause.

During an employee's probation period, either the employer or the employee may decide to terminate the individual employment contract by serving written notice, with no justification.

5.2 Is a minimum notice period required?

Mandatory notice periods are regulated by the law and vary depending on the reason for termination of the employment relationship. Thus, if the individual employment contract is terminated by the employee through resignation, the notice period is:

• a maximum of 20 working days for employees in non-management positions; and
• a maximum of 45 working days for employees in management positions.

If the employment contract is terminated by the employer, the notice period is a minimum of 20 working days; although longer notice periods may be:

• specified under the law for specific categories of employees, such as disabled employees; or
• negotiated between the parties.

The notice period must be observed only in certain cases of dismissal – that is:

• for reasons that are not imputable to the employee; or
• due to the employee's professional unsuitability or physical/mental incapacity.

No prior notice is required in case of:

• disciplinary dismissals; or
• dismissals due to the employee being taken into preventive custody or arrested at their domicile for a period exceeding 30 days under the Criminal Code.

Moreover, during the probation period, either the employer or the employee may decide to terminate the individual employment contract by serving written notice without any need to observe the notice period.

5.3 What rights do employees have when arguing unfair dismissal?

Under the Labour Code, the dismissal of an employee without observing the applicable legal provisions is null and void. However, the nullity of the dismissal must be determined by the court.

If an employee considers that their dismissal was unlawful, they may:

• challenge the dismissal decision in court; and
• request reinstatement in their previous position.

If the court determines that the dismissal was unjustified or illegal, it will:

• order the cancellation of the dismissal; and
• order the employer to:
• • pay the employee indemnification equal to their indexed, increased and readjusted salaries;
  • grant them all other rights to which they would have been entitled; and
  • reinstate them in their previous position (at the employee's request).

If the employee does not request reinstatement, the individual employment contract will terminate de jure on the date of the final court decision.

5.4 What rights, if any, are there to statutory severance pay?

No severance payments are mandatory for dismissal under the law. However, under the Labour Code, employees dismissed for reasons that are not imputable to them (ie, due to cancellation of the job position) may benefit from compensation under the terms of the law or the applicable collective bargaining agreement.

Without prejudice to the above, provisions on dismissal-related severance payments may also be included in the individual employment contracts or the employer's internal regulation, which should be checked and applied accordingly.

6 Employment tribunals

6.1 How are employment-related complaints dealt with?

The Romanian legal system sets out various processes that should be followed when addressing employment-related complaints. For example, under the Labour Code, the employer's internal regulation must specify the procedure for the amicable settlement of labour disputes and employees' individual requests or claims. Also, specific procedures for investigating complaints relating to discrimination, harassment in the workplace or similar must be implemented by the employer.

Furthermore, upon the conclusion of an individual employment contract or during its performance, the parties may agree to include in the contract a clause stating that any individual labour dispute will be amicably resolved through conciliation. Specific rules regarding the conciliation procedure should be specified in the individual employment contract.

Collective labour disputes may also arise between the employer and employees. In case of a collective labour dispute, the law specifies the stages that must be followed in order to settle the dispute.

Also, employees may submit complaints to various authorities that are competent to supervise different employment-related aspects, such as:

• the Labour Inspection; and
• the National Council for Combating Discrimination.

These authorities may enforce corrective actions against the employer if breaches of the applicable laws are ascertained, such as:

• the imposition of measures; and
• the application of fines.

Notwithstanding the above, employees have the right to lodge a legal action in court in order to protect their employment-related legal rights.

6.2 What are the procedures and timeframes for employment-related tribunals actions?

Due to the specifics of employment relationships, particular rules apply to employment-related legal actions, such as the following:

• Parties: As per the law, apart from employees and employers, other persons may also be parties to a labour dispute, such as a trade union (established and functioning in accordance with the law), which can defend the rights of its members.
• Applicable deadlines: Specific statutes of limitation are applicable to employment-related claims, ranging between 30 calendar days and three years, depending on the subject matter of the dispute.
• Competent courts: Labour disputes are judged pursuant to a two-tier system:
• • first-instance court (tribunals); and
  • courts of appeal.
• The territorial jurisdiction of the court is established by reference to the place of the plaintiff's domicile/residence/headquarters.
• Stamp duty: Although under the Romanian laws, the person initiating a legal action usually owes stamp duty (representing payment for the services performed by the courts), labour disputes are exempted from such duties.
• Burden of proof: As opposed to a regular litigation file, where the plaintiff has the burden of proof, in a labour dispute the burden of proof rests upon the employer (even where it does not act as a plaintiff in the dispute).
• Specific procedural aspects: The labour disputes are characterised by celerity, the courts having the obligation to examine the legal actions with urgency. For this purpose, no more than 15 days are to lapse between the court hearings, that are public. In practice, this legal deadline is not observed.

The rulings of the first-instance court are enforceable, even though the parties can lodge an appeal against such rulings.

In practice, rulings of the first instance court on challenged dismissals are granted within a 10–12-month period.

7 Trends and predictions

7.1 How would you describe the current employment landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

The Romanian labour market is facing various transformations, primarily triggered by economic factors and technological progress. Hot topics include:

• teleworking;
• electronic signature of individual employment contracts and other employment-related documents;
• digitalisation of processes;
• AI integration;
• labour force shortage;
• integrating non-EU workers;
• the need for workforce upskilling.

While some sectors (eg, automotive) seem to struggle to remain competitive given the international context, other remain on the ascendent (eg, energy), and all such aspects are likely to significantly impact the labour market.

In 2024, the scope of application of the first collective bargaining agreement in Romania was extended to all employees in the banking sector. Moreover, as far as collective negotiation is concerned, the Labour Code was amended in 2024 to provide for an action plan to promote collective negotiation, to be approved by government decision, providing for measures and deadlines that will support a progressive increase in the number of employees covered by collective bargaining agreements.

The Romanian employment legislative framework is dynamic and various legislative changes are envisaged, including:

amendment of the anti-harassment regulations; and

revisions aimed at achieving alignment with EU law – for instance, the EU Pay Transparency Directive (2023/970) must be transposed into the national legislation by June 2026.

8 Tips and traps

8.1 What are your top tips for navigating the employment regime and what potential sticking points would you highlight?

Compliance with employment regulations may prove challenging and often requires efforts from employers (including from a financial perspective); but it may prevent employers from:

• being fined;
• being subject to measures imposed by the authorities; and
• incurring a liability (including criminal liability – for example, due to failure to observe a first-instance court ruling on the annulment of a dismissal).

Employers should ensure that:

• they have in place policies and procedures that are duly communicated to their employees; and
• appropriate means of enforcing these policies and procedures are implemented.

Also, it is recommended that employers involve specialised consultants to:

• assist with the preparation of:
• • the various mandatory policies and procedures; and
  • the template employment documentation; and
• to audit existing ones to identify any potential gaps that may trigger the employer's liability.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.