Revolutionary Changes in Fixed-term Employment Contracts

K&L Gates LLP
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The President has signed an amendment to the Labor Code, which modifies the rules for concluding fixed-term contracts. The limits introduced do not only affect the number of contracts that can be entered into, but also their duration. The statutory notice period has also been extended.

Below are more details about the most important new regulations:

  • the total duration of employment under a fixed-term contract or contracts with an employee may not exceed 33 months
  • a maximum of 3 fixed-term contracts can be concluded with one employee
  • if the total period of employment under a fixed-term contract exceeds 33 months, or consists of more than 3 temporary contracts, the contract is deemed to be permanent
  • there are exceptions when these limits will not apply (i.e. contracts to replace an absent employee, to carry out seasonal work, or in the case of employment for a company function e.g. on the management board of the company)
  • the notice period for a fixed-term contract will depend on the period of employment with the employer and is similar to contracts for an indefinite period:
    • 2 weeks, if the employee has been employed for less than 6 months
    • 1 month, if the employee has been employed for at least 6 months
    • 3 months, if the employee has been employed for at least 3 years
  • the changes do not apply to the remaining rules of terminating fixed-term contracts – no obligations regarding: indication of reasons for the termination and consultation regarding the termination with a trade union
  • the issue of the renewal of the contract for a trial period with the same employee will be regulated - this will be possible if the employee is to be hired to carry out other work or if at least 3 years have passed following the termination of the previous ‘trial’ contract
  • the possibility of releasing an employee from work during the notice period - currently functioning only in practice - will be regulated by the Labour Code
  • a specific task contract and contract for substitution will no longer constitute distinct types of employment contracts

In principle the new regulations will come into force six months from the date of publication, i.e. on February 22, 2016. The amendments contain a number of interim provisions concerning in particular the rules applicable to fixed-term contracts in effect on the date the regulations will enter into force.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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