Changes in Croatian labour law

The Croatian Government presented a new draft of the Employment Act last week.

• Claims arising out of employment shall henceforth fall under the statute of limitation after five years (currently: three years).
• Employees can be transferred to an affiliated company for up to six months, on the basis of an agreement entered into between the affiliated companies, which requires a written consent of the employee. Until now this was not possible, even with the employee’s consent; in order to effect this, it was necessary to terminate an existing employment contract and enter into a new one. This will make things easier, at least for group organisations.
• Allowed overtime work has been increased from eight to ten hours a week. On the annual basis, it is still allowed to work altogether 180 overtime hours (250 hours, if agreed so by the virtue of a collective bargaining agreement).
• Notice periods: in case the notice period is interrupted due to sick leave, the employment shall terminate in any case, six months after the termination notice was handed over to the employee. In case the employee is granted garden leave during a notice period, notice period shall run during annual vacation, as well as during sick leave.
• The fact that a company employs employees should no longer hinder the liquidation of a company.
• After cessation of a collective bargaining agreement, its provisions regarding entering, content and termination of employment will still be applicable within a period of three months after cessation thereof.

Social partners already expressed their further disagreement with the final proposition of the Act. It will be interesting to see which of the proposed amendments will indeed be accepted by the Parliament.