AMENDMENT TO THE LABOUR CODE – KEY CHANGES FROM 1 AUGUST 2024

On 18 June 2024, the National Council of the Slovak Republic approved an amendment to Act No. 311/2001 Coll., the Labour Code, which will take effect on 1 August 2024. This amendment brings several changes to labour law, including the possibility of wages being paid by the service contractor in the Slovak Republic and adjustments to work performed by minor employees. The amendment reflects the European Commission’s opinion that Slovak measures were not in line with Directive 2014/67/EU of the European Parliament and of the Council.

WHAT IS SUBCONTRACTING LIABILITY? I POST EMPLOYEES – DOES IT CONCERN ME?

SUBCONTRACTING LIABILITY

The amendment to the Labour Code introduces rules on subcontracting liability, which aim to ensure that posted employees can be certain their wages will be paid properly. This change is a response to criticism from the European Commission that Slovak legislation does not sufficiently reflect the principle of subcontracting liability.

WHO IS A POSTED EMPLOYEE?

• Guest employee: An employee who normally works in another EU member state but is posted to work in Slovakia.
• Domestic employee: An employee who normally works in Slovakia but is posted to work in another EU member state.

CURRENT LEGISLATION (SECTION 5(11) OF THE LABOUR CODE)

A guest employee who has not been paid the wages due by their guest employer has the right to claim payment from the individual or legal entity that is the service contractor in the Slovak Republic and of which the guest employer is a direct subcontractor.

EXAMPLE:

An employee from the Czech Republic is posted by their employer to work for a Slovak company. If the Czech employer does not pay the employee their wages, the employee can claim them from the Slovak company that uses their services.

NEW LEGISLATION FROM 1 AUGUST 2024 (SECTION 130A)

Employees will be able to claim unpaid wages not only in the case of cross-border posting, but also in domestic subcontracting relationships. An employee may ask the service contractor in the Slovak Republic of which their employer is a direct subcontractor to pay the wages due, provided that:

• The wages are due and unpaid for work listed in Annex 1aa to the Labour Code (e.g. construction work).
• The employee requests payment within six months of the date on which the wages fell due.

What the request must contain:

• Identification details of the employee and the employer.
• The amount of the unpaid wages and information on when they fell due.
• The period and type of work performed within the subcontracting relationship.
• The method of payment of the wages (in cash or to a bank account).

Amount of the wage claim:

The employee may claim wage compensation up to a maximum of the minimum wage applicable at the time the work was performed. If the employer has paid part of the wages, the service contractor will pay only the difference up to the minimum wage.

Obligations and rights of the service contractor:

• To pay the wages within 30 days of receiving the employee’s request.
• To inform the employee and the subcontractor that the wages have been paid or of the reasons for not paying them.
• The contractor may refuse to pay the wages if, when selecting the subcontractor, it could not have foreseen that the subcontractor would not pay wages.

WORK BY MINOR EMPLOYEES

The amendment to the Labour Code also regulates work by minor employees. Until now, there was a ban on starting work before the end of compulsory school attendance. From 1 August 2024, it will be possible to employ pupils who have reached the age of 15 as early as the summer holidays after lessons end in the last school year of compulsory school attendance. The consent of the competent labour inspectorate will not be required for this purpose either.

CONCLUSION

The amendment to the Labour Code brings significant changes aimed at better protecting employees’ rights, particularly with regard to the payment of wages in subcontracting relationships, and at allowing minors who have reached the age of 15 to be employed during the summer holidays. These changes have a fundamental impact on labour law and will require increased attention from employers and employees alike. For more detailed information and advice, we recommend contacting your accounting firm.