Labour dispute conciliation and organization of the hr / payroll activity

On Saturday, 3 October 2020, Law 213/2020 amending and supplementing Law 53/2003 – Labour Code (“Law”) came into force and brought new elements in relation to the amicable settlement of individual labour disputes as well as in relation to the organization of the human resources and payroll activity.

I. WHAT DOES CONCILIATION ENTAIL?

The law regulates conciliation as a preliminary optional procedure that involves an attempt to amicably settle the disputes between employers and employees. Conciliation refers to individual labour disputes, while collective labour disputes remain subject to the settlement procedure stipulated by the Social Dialogue Law.

Thus, the parties will be able to include in the individual labour agreement (including in the addenda thereto) a clause establishing that any individual labour dispute is amicably settled by means of the conciliation procedure. Nevertheless, the parties may waive conciliation in case they do not reach a solution that accommodates the interests of both parties, case in which they have the possibility to resort to a claim before a court of law.

To whom will the parties resort?
Pursuant to the Law, any of the parties may resort to an external consultant specialised in labour law, i.e. a lawyer, an expert in labour law or, as the case may be, a mediator specialised in labour law.

What role does the external consultant play?

Pursuant to the Law, the external consultant will endeavour to determine the parties to act responsibly in order to terminate the dispute, observing at the same time the employees’ rights. Thus, the external consultant will try to reconcile the parties and to encourage them to find, by common agreement, a solution that is beneficial for each of them in view of settling the individual labour dispute.

Who is allowed to choose the external consultant?

The Parties will have the right to choose their external consultant freely, therefore it is necessary to have both parties’ consent in this respect. Upon concluding the individual labour agreement, the parties should establish the identity/identification criteria of the external consultant (e.g., a certain law firm) that will reconcile the parties in case of individual labour disputes, because it is difficult to assume that on the occurrence of the dispute the parties will be able to reach an agreement on this matter.

How to open the conciliation procedure? Effects on the statute of limitation

Once they agree on the external consultant that will settle the dispute, any of the parties is allowed to notify such consultant, and the latter will send the other party a written invitation using the means of communication indicated in the labour agreement. In no more than 5 business days as of receiving the invitation, the conciliation procedure will be opened. This moment is relevant because, as of the opening date of the procedure, the term within which the labour dispute may be submitted to a court of law for settlement, will be suspended.

What is the duration of a conciliation procedure?

The law does not stipulate a duration for the conciliation procedure, as it may last until the parties reach a solution on the disputed aspects or until such time that the conciliation fails.

Conducting the procedure

The conciliation procedure will be finalised with the elaboration of a conciliation protocol signed by the parties and by the external consultant, in the following circumstances:

a) when the parties reach an agreement;
b) when the consultant established that the conciliation has failed;
c) when one of the parties fails to appear on the date established in the invitation.

The parties can even reach a partial solution to be included in the protocol, while, for the rest of the dispute, they will have the choice to file a court claim.

After the completion of the conciliation procedure, the time limit within which the labour dispute may be submitted to court for resolution will begin to run again from the time when it was initially stopped.

Obligation to update internal regulations 

According to the Law, one of the elements that will necessarily have to be included in the Internal Regulation will be the procedure for amicable resolution of individual labour disputes and of employees’ individual requests or complaints.

Given that the parties are required to agree upon and include this procedure in the individual labour agreement, most probably the lawmaker only envisaged the description in the Internal Regulation of the steps to be taken, but such steps will be actually taken only if that special clause is included in the individual labour agreement (given the unilateral nature of the Internal Regulation).

II. OTHER DUTIES OF THE EXTERNAL LABOUR LAW CONSULTANTS

According to the Law, the external labour law consultants will be allowed to assist the employee in relation to the negotiation, conclusion or amendment of the individual labour agreement, during the preliminary disciplinary investigation or throughout the conciliation of an individual labour dispute. However, the employer may request them to sign a confidentiality agreement.

Furthermore, the employers will have the possibility to outsource the disciplinary investigation activity to an external labour law consultant whom they will empower in this respect.

III. DEVELOPMENTS REGARDING THE ORGANISATION OF THE HUMAN RESOURCES / PAYROLL ACTIVITY

The law now regulates certain aspects that have been happening in practice for a very long time, namely the fact that the employer can fulfil on its own the specific human resources/payroll duties or by contracting external human resources and payroll services.

The novelty element brought by the Law is that the external human resources and payroll services will be coordinated by a labour law expert. This new provision may pose difficulties for the providers of such services who currently do not have any employees qualified as labour law experts.

IV. CONCLUSIONS

The new provisions do not bring substantial changes in the field of labour relations. In essence, the objective was to enable employers to resort to labour law specialists, i.e. labour law experts, precisely in order to ensure a better management of the employer’s obligations (including the keeping of the General Register of Employees (REVISAL) and to avoid the application of fines by the authorities (according to the employment standard approved by the National Authority for Qualifications by decision no. 117/04.04.2013 and revised by decision no. 439/27.11.2015, the labour law expert has expertise on the employee-employer relations, work organisation and payroll, as well as on the out-of-court representation of employers in their relation with the labour and social security authorities).

As for the conciliation, the aim of the lawmaker was to relieve the courts and try to achieve an early resolution of the labour disputes before going to court. Therefore, the legislative amendment regulates a common practice among employers, namely the attempt to amicably settle a labour dispute before bringing it to court.

Moreover, the new regulation validates the employers’ classic approach to offer the employees severance packages or other positions within the company, when the employers take the initiative to terminate the employment relation, mainly for economic reasons not related to the employee’s person, fact which the employees sometimes interpret as an act of targeting on a personal level. Of course, it is not mandatory for the employer to resort to conciliation procedure in discussions about termination or modification of employment relations, but it remains optional.

Further on, employers should update their internal regulations and then consider whether it is appropriate to draft clauses to be inserted in the employees’ labour agreements, in order to ensure conciliation of any potential individual labour disputes.

This information is not legal assistance. For further details, please contact us.

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