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Factsheet for measure RO-2011-21/2598 Updated – measures in Romania

Temporary reduction of activity

Reducerea temporară a activității

Country Romania , applies nationwide
Time period Open ended, started on 18 May 2011
Context COVID-19, Restructuring Support Instruments
Type Legislations or other statutory regulations
Category Employment protection and retention
– Income support for people in employment (e.g., short-time work)
Author Victoria Stoiciu (European Institute of Romania) and Eurofound
Measure added 23 June 2022 (updated 17 November 2022)

Background information

All employers can use the temporary reduction of activity is in cases of temporary business slowdown for economic, technological, structural or other similar reasons.

It has also been used during the COVID-19 crisis along with a governmental wage indemnity for suspended or reduced activity for companies suffering from a reduced turnover due to the COVID-19 crisis.

Content of measure

The employer has three possibilities of internal flexibility available to use:

  1. After consultation with the trade unions or worker representatives, the employer may reduce working time from five to four days per week, in case of business slowdown over periods exceeding 30 working days.
  2. During business slowdown and/or temporary interruption of operations, employers may suspend the employment contract of workers. In this case, the affected employees must receive a compensation.
  3. During periods of reduced activity, the employer has the possibility to grant paid holidays to compensate for the extra work to be done in the following 12 months.

It can be used by any type of enterprise, no subjects are excluded.

The governmental wage indemnity for suspended or reduced activity (hereafter, the indemnity) is eligible for companies suffering from at least 25% reduced turnover due to the COVID-19 crisis. For the indemnity to be paid, the employer must submit and affidavit concerning the registered decrease of indebtedness for the previous month. The decrease has to amount a minimum of 25% compared to the average of indebtedness registered in January to February 2020, and the company must not have the financial capacity to pay all the employees.

Updates

The following updates to this measure have been made after it came into effect.

02 April 2021

By derogation from certain provisions of the Labour Code in the case of temporary reduction of work due to state of emergency/alert/curfew, employers have the possibility of reducing the working time of employees for this period, as well as on for a period of up to 3 months from the date of the end of the last emergency/alert/curfew period. The reduction in working time applies for at least 5 working days per month that they need no longer be consecutive.

Employers have the possibility to reduce employees' working time by up to 50% of daily, weekly, monthly duration stipulated in the individual employment contract. The allowance for employees during the reduction of working time is borne by the employer from the personnel costs chapter of the revenue budget and expenses of the employer and will be settled within 5 days after the decision is issued. The law prohibited the accumulation of the allowance for reduced working time with other active support measures. The financial support for employers in the amount of RON 2,500 (approx. €505) has been extended to employees who teleworked for at least 15 working days during the state of alert.

Employers have the option of reducing employees' working time by up to 80% of the daily, weekly or monthly working time stipulated in the individual employment contract (as opposed to the previous limit of up to 50%). As before, the measure will be available both during the period of emergency/alert/standby and for up to 3 months after the end of the last period of emergency/alert/standby. The application of the measure will be subject to the agreement of the trade union or employee representatives, where they exist, and to the information of employees in units where there is no trade union or employee representative. The employer is required to submit a copy of the agreement or, where applicable, proof of employee information with the claim for payment of the allowance.

The calculation of the allowance for employees affected by the measure is clarified by the legislator, in the sense that the 75% is calculated by reference to the gross monthly basic salary for the hours of reduced working hours. If the budget for staff costs allows, the employer will be able to supplement the allowance by amounts representing the difference up to the level of the basic salary corresponding to the post occupied, but without this difference being settled.

Use of measure

By May 2020, 1,118,865 employees received indemnity for technical unemployment and the total amount paid by the state was RON 1.38 billion (€290 million). A total number of 129,149 employers were registered with valid applications by the National Employment Agency.

Target groups

Workers Businesses Citizens
Employees in standard employment
Applies to all businesses Does not apply to citizens

Actors and funding

Actors Funding
National government
Trade unions
Employees
Employer
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role Unknown Unknown
Form Not applicable Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

  • Unknown
  • Main level of involvement: Unknown

Involvement

There is no publicly available information about the social partners' involvement in designing, implementing and monitoring the measure.

Views and reactions

There is no publicly available information about the social partners' views or reaction on the measure.

Sources

  • 24 January 2003: Labour code (www.ilo.org)
  • 18 May 2011: Labour Code, Act 53/2003, republished in the Official Gazette of Romania No. 345 of 18 May 2011 (Codul muncii republicat) (www.medicinamunciisuceava.ro)
  • 30 April 2012: Clauwaert, S. and Schömann, I. (2013), The crisis and national labour law reforms: a mapping exercise. Country report: Romania, ETUI (Criza și reformele naționale ale legislației muncii: un exercițiu de cartografiere. Raport de țară: România, ETUI) (www.etui.org)
  • 18 March 2020: Government Emergency Ordinance no.30/2020 (Ordonanța de Urgență a Guvernului nr. 30/2020) (lege5.ro)
  • 21 March 2020: Official Gazette no. 230/21.03.2020 (Monitorul Oficial nr. 230/21.03.2020) (monitoruloficial.ro)
  • 26 March 2020: Government Emergency Ordinance no.32/2020 (Ordonanța de Urgență a Guvernului nr. 32/2020) (www.mmuncii.ro)
  • 16 May 2020: Labor Ministry press release on COVID-19 support measures (Comunicat de presă Bilanțul măsurilor luate de Ministerul Muncii și Protecției Sociale în perioada stării de urgență: plăți de peste 1,78 miliarde lei pentru aproape 1,3 milioane de beneficiari) (mmuncii.ro)
  • 27 May 2020: Government Emergency Ordinance no.90/27.05.2020 (Ordonața de Urgență a Guvernului nr. 90/27 mai 2020) (static.anaf.ro)
  • 28 May 2020: ILO overview of policy responses to COVID-19 (www.ilo.org)
  • 11 June 2020: Deloitte Tax & Legal Weekly Alert
  • 09 December 2020: Law no. 282/08.12.2020 (LEGE nr. 282 din 8 decembrie 2020) (legislatie.just.ro)
  • 24 December 2020: Deloitte Tax & Legal Weekly Alert (www2.deloitte.com)
  • 05 April 2021: Law no. 58/02.04.2021 (LEGE nr. 58 din 2 aprilie 2021) (legislatie.just.ro)
  • 22 April 2021: Deloitte Tax & Legal Weekly Alert (www2.deloitte.com)
  • 13 January 2022: Guidelines for employees and employer regarding the indemnity for suspended or reduced activity (Somaj tehnic 2022 pentru angajatori si angajati) (legislatiamuncii.manager.ro)
  • 21 April 2022: OECD overview of policy responses related to COVID-19 (www.oecd.org)

Citation

Eurofound (2022), Temporary reduction of activity, measure RO-2011-21/2598 (measures in Romania), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/RO-2011-21_2598.html

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