Labour law in Slovenia

1.1. Employment contracts

Written form

Employment contracts have to be concluded in writing and signed before or on the first day of work. Furthermore, a draft of the employment contract must be provided to the employee at least three days before the commencement of the employment. If – contrary to the statutory provisions - an employment contract is not duly signed, it is assumed that the employment relationship commenced on the first day of work and that it was concluded for an indefinite term. However, the written form is not a prerequisite for the validity of the employment relationship, meaning the employment relationship may also be concluded orally or by way of an implied agreement, which is however not common (or advisable) practice.

Fixed-term agreement

Employment contracts can be concluded for a definite (fixed term) period of time as well as for an indefinite term. As a rule, the employment contract should be concluded for an indefinite term. 

Employment contracts may only be concluded for a fixed period of time under specific statutory conditions which are explicitly listed in Article 54 of the Employment Relationship Act ( “ZDR-1”; e.g. work which by its nature is of a definite duration, substitution of a temporarily absent employee, temporary increased volume of work, work organised as project or seasonal work, work of management employees and proxy holders etc.) and for the period of time which is required for the realisation of work in the aforementioned cases. The statutory reason for the conclusion of a fixed term agreement shall be explicitly stated in the agreement. 

ZDR-1 also limits the use of employment contracts for a definite period of time by prohibiting the employer to conclude fixed term employment contracts for more than two years of time for the same work. This time limit of two years refers not only to a certain employee but to a certain type of work as well and is also relevant if several employment contracts are concluded consecutively with interruptions of no more than three months. The branch collective bargaining agreements may stipulate individual exceptions from this time limit.  

Employment contracts which are not concluded in written form are deemed to be concluded for an indefinite period. The same rule applies to employment agreements which have been concluded for a fixed term without a justified cause. 

According to the ZDR-1, the probationary period may last for a maximum of 6 months, if not determined otherwise in the applicable collective bargaining agreement. 

An employee whose fixed-term employment agreement has ended due to lapse of time is entitled to a severance payment (1/5 of the average monthly salary of the employee for employment contrasts of up to one year and an additional proportionate amount of 1/12 of the existing 1/5 for every further month). The employee is not entitled to such severance payment if the agreement was concluded: a) to replace a temporarily absent worker, b) perform seasonal work that lasts less than three months in one calendar year, c) perform public works, or d) for the purpose of integrating policy measures into active employment.

Choice of law

All employment relationships concluded on the territory of the Republic of Slovenia are governed by Slovenian law (with the exception of foreign diplomats). In the event of workers being posted to the RS by a foreign employer, Slovenian law shall be applicable in accordance with the provisions governing the position of posted workers.

Choice of legal venue

Pursuant to the provisions of ZDR-1, local jurisdiction over contractual or statutory rights and duties may not be excluded. Matters regarding employment law are settled before the competent Labour and Social Court. If the employee acts as a plaintiff, the court’s jurisdiction is based upon the employer’s/defendant’s registered offices or the place where the work has (should have) been performed or the place where the employment relationship was concluded. If the employer acts as a plaintiff, general jurisdiction according to the defendant’s residence is given.

The Labour and Social Court in Ljubljana has exclusive jurisdiction over intellectual property disputes deriving from the employment relationship.

1.2. Alternatives to the conclusion of an employment contract

Other independent relationships

Independent service providers are not subject to the provisions of the Employment Relationship Act. Such service agreements (usually named as “agreement for performance of work”, “contract for carriage”, “building contract”, “mandate contract” etc.) are concluded in the framework of the provisions of the Slovenian Code of Obligations. 

Economically dependent persons

If such an independent service provider who is a self-employed person (independent entrepreneur) on the basis of a civil law contract obtains at least 80% of his annual income from work for the same contractor (e.g. “economic dependence”), he is considered as an economically dependent person. The protection granted to such workers extends to the prohibition of discrimination, comparable liability for damages as applicable to employees, the right to proper payment (minimum salary), minimum notice periods, and the prohibition of termination of his civil law contract without substantiated grounds.

Elements of the employment relationship

Persons who voluntarily provide services: (i) in an organised work process with elements of subordination and under the employer’s control; (ii) against remuneration; (iii) personally; (iv) as well as uninterruptedly for a long time; are subject to a statutory presumption that an employment relationship is actually in place. 

1.3. Employment of foreign citizens 

Single permit

Foreign or third country workers must obtain a single permit (consent to work and residence permit) pursuant to the provisions of the Employment, Self-employment and Work of Foreigners Act.

This act and its derivative legislation establish that the basic condition for employment of a foreign citizen is the current labour market situation and a shortage of adequate domestic candidates. In this respect, the government may determine an annual quota of consents to work for single permits and permits for seasonal work.

Citizens of member states of the European Union, EEC member states and Switzerland are not required to obtain a single permit, but must register their residence within three months’ time after entry to the country. The certificate on registration of residence is issued for 5 years or for the period of intended stay in the Republic of Slovenia, if this is shorter than five years.

Highly qualified foreigners may also obtain a residence permit for the purposes of highly qualified employment (EU Blue Card).

1.4. Special provisions for representatives 

Single permit due to work or employment

If a foreigner represents a Slovenian branch of a foreign company or a legal entity established in accordance with the Companies Act and wishes to perform work or be an employee in such entity, said foreigner must have a single permit.  However, the procedure to obtain consent (part of the single permit) is simplified in this case, since no obligation exists to assess the Slovenian labour market beforehand (i.e. availability of eligible Slovenian candidates for this job position). 

Companies and Slovenian branches of foreign companies with up to 10 employees may apply for the single permit for only one foreign representative. Companies and Slovenian branches of foreign companies with more than 11 and up to 50 employees may apply for two single permits for foreign representatives. 

Short-term representation registration

A legal representative from a 3^rd country may perform representational work, conclude legal transactions, supervise, give instructions and perform similar works within that function based solely upon a registration of work. Note that said registration must be completed in addition to the legal representative being entered into the court register, as these are two separate legal institutes. However, work based on such registration may be carried out only up to 90 days in a calendar year. 

2.1. Minimum wage

The Minimum Wage is regulated in the Minimum Wage Act. The minimum wage represents payment for full-time work, whereby allowances for night work, Sunday work, work on public holidays and work on free days is explicitly excluded from the minimum wage. As of January 2023, the minimum wage amounts to EUR 1203.36 gross. The minimum wage is set at a level between 120% and 140% of the minimum cost of living, taking into account consumer price inflation, wage trends, economic conditions or economic growth and employment trends, with reference to tax rules that allow the gross amount of the minimum wage to be set. It is determined annually by the Ministry of Labour, Family, Social Affairs and Equal Opportunities.

2.2. Pay raises

Collective bargaining agreements

Pay raises occur as a result of periodical negotiations on collective bargaining agreement. They are recorded in the respective written collective bargaining agreement.

Pay raises may also be agreed individually between the employer and the employee based on the performance of the latter or can be determined by the employer on the basis of internal by-laws.

2.3 Pay reduction

Agreement

Remuneration may only be reduced by mutual agreement between the employee and the employer.

If the employer is temporarily unable to provide work due to business reasons (e.g. an economic crisis), then they may temporarily lay-off the affected employees via written notice for a maximum period of six months in one calendar year. For this time, the employee has a right to salary compensation to the amount of 80 % of his regular salary.

3.1. Daily and weekly regular working hours and breaks

Regular weekly working time amounts to 40 hours. Daily regular working time amounts to 8 hours, with a paid lunch break of 30 minutes included. For part-time employees working for at least four hours per day, the duration of this lunch break should be calculated in proportion to the working hours. 

3.2. Statutory periods of rest

Rest periods

Employees are entitled to a daily minimum rest period of at least 12 hours, as well as a weekly minimum rest period of at least 24 hours. If, however, working hours are unevenly distributed, the employee is entitled to a daily minimum rest period of at least 11 hours. 

Employment and collective bargaining agreements may stipulate other additional provisions for management (executive managers or proxy holders) employees.

3.3. Maximum permissible daily and weekly working hours

Full-time weekly working hours should not exceed 40 hours (in average). In the event of even distribution of working time the maximum permissible daily quota is 10 hours. In the event of uneven distribution of working time, the maximum permissible daily quota is 13 hours, whereas the weekly working hours must not exceed 56 hours, including overtime work

Employers cannot demand more than a maximum of 170 hours of overtime work per year, 20 hours per month and 8 hours per week. The annual limitation of 170 hours may be exceeded (up to 230 hours in total), whereby the employer has to gain the employee’s written consent in each case of required overtime work.

3.4. Performance and remuneration of overtime

Overtime work is only exceptionally allowed

Overtime work may only be allowed due to exceptional business needs or where public interest is involved (e.g. exceptionally increased amount of work, if overtime work is needed to prevent material damage, a threat to life, to ensure the safety of people and property etc.). Overtime work may not be imposed if the work could be distributed within regular working hours via a suitable organisation and distribution of work, distribution of working time, introduction of new shifts or by employing new workers. Also, certain groups of employees such as the elderly, young employees, pregnant women, employees with health risk etc., may not be ordered to work overtime.

Written form is required

In general, overtime work should be ordered by the employer in writing prior to commencement. If overtime work is performed without the order of the employer, the employee is not entitled to extra pay for such work. However, if the employer does not give a written order but knows that the employee has to work overtime for the requested task, this should not result in negative consequences for the employee in terms of the overtime not being acknowledged. 

Branch collective bargaining agreements

The individual branch collective bargaining agreements provide provisions with regards to the performance and amount of remuneration of overtime. No general statutory provisions apply in this regard.  

3.5. Work at night, Sundays and holidays

Pursuant to ZDR-1, employees are not only entitled to additional compensation (allowances) for overtime work, but also for night work, work on Sundays and work on public holidays and work-free days. 

Work undertaken over Saturdays is qualified as overtime work and remunerated under the conditions in and according to the amount stipulated in the relevant collective bargaining agreement. 

3.6. Bonuses for work done on holidays and at night 

Collective bargaining agreements

Allowances for work on holidays and at night are governed by the applicable branch collective bargaining agreements.

Definition of night work

Night work is work between 11 pm and 6 am of the following day. However, if a distribution of working time involves a night shift, night work shall mean eight uninterrupted hours between 22.00 pm and 7.00 am on the following day.

Special protection for overtime and work at night

Particular groups of employees may not be instructed to perform overtime work and work at night at all (e.g. pregnant employees) or without the permission of such affected employee (e.g. parents with young children, elderly employees) .

An employee has a right to a special protection if he daily works at least three hours at night and/or does night work for at least one third of his full annual working time.

In a period of four months, the working time of a night employee may not exceed eight hours a day on average. Night work for under-aged employees is forbidden. The employer may not order an elderly employee to do night work without the latter’s consent.

3.7. Special provisions for certain employees

Certain employees such as management (executive managers or proxy holders) employees, middle-management (leading) employees and employees who perform work from home may agree with the employer in their employment agreements on a different regime with regard to working hours, night work and breaks, as well as daily and weekly rest. 

4.1. Statutory holiday entitlement

Minimum amount of annual leave days

Pursuant to ZDR-1, every employee is entitled to at least 4 weeks of paid annual leave (20 days for a five-day week, 24 days for a six-day week etc.), of which at least two weeks shall be consumed together. 

The following persons are entitled to extra leave of at least three additional days: elderly employees, disabled employees, employees with an at least 60% physical impairment, as well as employees nursing a disabled child. Employees taking care of children are entitled to one additional day of annual leave for every child under the age of 15 years. 

In addition, collective bargaining agreements stipulate additional days of annual leave (e.g. for seniority) and additional days of paid absence for particular events (e.g. weddings, relocations, death of near relatives etc.). 

Proportionate annual leave

The employee whose agreement is terminated prior to the end of the calendar year is only entitled to 1/12 of the annual leave for each month of employment in the respective year and as a consequence is only entitled to proportionate holiday allowance.

4.2. Expiry of holiday entitlement

Holiday consumption

As a rule, the employees must consume their entire holiday allowance before the end of a calendar year. The employer may request that the employee uses at least two weeks of annual leave for the current calendar year. 

Transferral to the following year

Should an employee not use his entire annual leave (with the exception of special additional holidays), the remaining holidays are carried forward to the next calendar year but must be used before 30^th of June of the following year. If the employee was not able to use the entire annual leave in a calendar year due to illness or injury, maternity leave or leave to take care of a child, the employee may use it by up to 31 December of the following year.

Prohibition of repayment

Unused annual leave may only be paid in lieu if an employee was objectively unable to use it before the end of the employment relationship. 

Continued remuneration/sickness pay

In case of sickness the employer shall provide minimum wage compensation for the first 20 working days of each sick leave but only up to 80 working days in a calendar year. If the absence from work is caused due to an accident at work or occupational disease, the employer shall provide minimum wage compensation for the first 30 working days of each sick leave. I.e.: (i) 100% wage compensation in cases of accidents at work or occupational disease; (ii) 90% wage compensation for cases where living tissue and organs are transplanted for the benefit of another person, for the effects of donating blood and in cases where isolation is ordered by the doctor; (iii) 80% wage compensation in case of disease and if the employee stays at home to nurse and assist a family member if so prescribed by the doctor; and (iv) 70% for accident outside of work. Collective bargaining agreements may however prescribe sick pay that is more favourable to the employee. Sick pay is paid by the responsible social insurance institution for the subsequent time.

Annual entitlement to sickness pay

In cases of non-occupational illness, wage compensation is only provided by the employer for a maximum of 20 working days for each case of illness. In case of an accident at work or occupational illness, wage compensation is provided by the employer for a maximum of 30 working days for each case of illness. Nevertheless, a maximum of 80 days per year applies in cases of non-occupational diseases, irrespective of the number of sick leaves per year.

Medical confirmation

The employee is obliged to notify the employer about his absence on the first day of absence. However, a medical certificate or verification may be presented at a later stage and is uploaded to the online system by the doctor. 

General information

Employment may end upon ordinary or extraordinary termination by either party, by mutual agreement, by court verdict, by law, by lapse of time (in case of fixed-term employment) or through the death of the employee.

Termination by mutual agreement

Employment contracts may be mutually terminated at any time. However, such an agreement must be in writing and must include instructions as to the legal remedies (such as that the employee loses all rights/benefits from unemployment insurance in cases of mutual termination).

Probationary period

Probationary periods may last up to six months, while the exact duration depends on the category of employment. The employee or the employer may (due to unsatisfactory work in the probationary period) terminate the employment relationship during the probationary period, with a notice period of 7 days. 

Termination without notice 

Termination without notice is only admissible in cases of extraordinary termination. 

An employment contract may only be extraordinarily terminated if the termination notice was delivered to the employee within 30 days since the employer discovered the violation and within 6 months at the latest since the violation occurred. 

Termination due to lapse of time

Fixed-term employment agreement ends automatically upon completion of the stipulated term. Implied continuation of the employment constitutes employment for an unlimited period of time.

6.1. Formal requirements for termination by the employer 

Written form

The termination of the employment relationship must be in writing and the reasons for termination must be stated. Termination of the employment agreement not made in writing is invalid.

Prior notification

In certain cases, the employer must communicate its intention to terminate the employment relationship to the affected employees in advance and allow them to defend themselves in a pre-termination interview (e.g. in case of termination due to reasons of incapacity, culpability as well as extraordinary termination). Collective bargaining agreements may further stipulate preliminary as well as ordinary procedure for terminations.

Mass redundancies

The collective dismissal of 10 employees out of at least 20 employees, 10 % of all employees in companies with 100 to 300 employees or 30 employees in companies employing more than 300 employees in a period of 30 days requires the employer to apply collective redundancy rules. 

No authorisation required

Regarding the termination of the employment relationship, no general formal permission from a particular governmental agency is required (except in specific cases such as if the employment contracts of employees on parental leave are terminated because the company is being wound up). Protection through the trade unions is provided in the form of participation rights. Nevertheless, such an involvement cannot impede the termination, but merely delay the process.

6.2. Reasons for dismissal

Ordinary termination

The employer may terminate the employment contract only if a justified reason for ordinary termination exists. The reason for a dismissal may be either personal (the employee´s conduct) or business (operational reasons).

• Business reasons
  • re-organisation of work processes,
  • economic circumstances, and/or
  • technological, structural or similar reasons
• Personal reasons
  • incapability,
  • violation of contractual obligations by the employee (culpable behaviour),
  • inability to perform work due to a disability, and/or
  • an unsuccessful probationary period.

Notice periods

If the employer terminates the employment contract due to business reasons or due to the employee's incompetence, the notice period varies between 15 and 80 days, depending on the employee's years of service with the employer. In case of employment up to one year, the notice period of 15 days applies, whereas for employment for one to two years, a 30-day notice period applies. For every consequent year of service, the notice period gradually extends for two days until a maximum of 60 days. For the period of service above 25 years, the notice period of 80 days is applicable.

If the employment contract is terminated by way of ordinary termination and the employee is at fault, the notice period is 15 days, unless the respective collective bargaining agreement or the employment contract provide for a longer period.

Collective bargaining agreements or individual employment agreements may provide for longer notice period (nevertheless, if the period of service is over 25 years, the notice period cannot be shorter than 60 days).

Severance payment

In case of ordinary termination for business reasons as well as termination for reasons of incapacity, the employer must make a severance payment. The amount of the payment depends on the number of working years (the period of employment with the employer shall also include work done for the employer's legal predecessors) and the employee’s average monthly salary. The minimum period of continuous employment required for acquiring severance payment is one year. The base for the calculation is the average monthly salary, which the employee received or would have received if the employee had worked during the last 3 months prior to the termination The severance payment amounts to (i) 1/5 of the base for each year of employment with the employer if the employee has been employed from one to ten years; (ii) 1/4 of the base for each year of employment with the employer if the employee has been employed for over ten and up to twenty years; and (iii) 1/3 of the base for each year of employment with the employer if the employee has been employed for more than twenty years. 

Unless the respective collective bargaining agreement states otherwise, the maximum severance payment amounts to ten times the employee’s average monthly salary. 

Extraordinary termination

An employment contract may also be terminated by way of an extraordinary termination – i.e. termination without a notice period which takes effect when served to the other party. It may be given by any of the contracting parties, provided that grounds for termination exist and that the continuation of the employment relationship between the parties is no longer possible.

An employment contract may also be terminated by way of an extraordinary termination – i.e. termination without a notice period which takes effect when served to the other party. It may be given by any of the contracting parties, provided that grounds for termination exist and that the continuation of the employment relationship between the parties is no longer possible. 

An employer may dismiss the employee without notice on the following grounds: 

• gross or intentional negligence which violates the contractual or other employment obligations; 
• perpetration of a criminal offence; 
• presentation of false information and false proof of eligibility for the job position by the candidate; 
• the employee fails to come to work for at least 5 consecutive days and fails to inform the employer of the reasons for the absence, even though the employee should and could have done so; 
• the employee is prohibited by final judgement from performing certain work or is not able to perform it for more than 6 months due to educational or safety measures; 
• refusal of the employee to be transferred and to perform work for the transferee; 
• absence from work for more than 5 days after the suspension of the contract has been lifted; and/or 
• the employee does not follow the doctor’s instructions during absence from work caused by illness or injury. 

The employer must communicate its intention to terminate the employment contract to the affected employee in advance and allow the employee to defend himself at a special pre-termination interview, unless conditions exist which mean the employer cannot be expected to grant the employee such interview (e.g. if the employee has assaulted the employer).

Termination by employee

An employee may terminate the employment relationship without giving any reasons to the employer. In case of ordinary termination of the employment relationship, the notice period is 15 days if the person is employed for up to 1 year and 30 days in cases of longer employment. The maximum notice period which can be agreed in the individual or collective agreement is 60 days. 

An employee may extraordinarily terminate the employment contract within 30 days after having previously given the employer a reminder that the employer should fulfil its obligations (the employer has 3 working days to fulfil said obligations) and after notifying the labour inspectorate that the contractual obligations have been violated. If the employee terminates the employment relation without notice due to a decisive breach of contractual obligations by the employer (e.g. unpaid salaries, non-payment of social contributions, sexual harassment etc.), the employee is entitled to severance pay and damages at least to the amount of salaries that the employee would have received if the regular notice period had been taken into consideration. 

6.3. General protection from dismissal

Trade unions

If mass redundancies are intended, the employer must inform and consult the respective trade unions in advance. 

In the event of individual terminations, upon request of the employee, the employer must inform in writing the trade union the employee belongs to when termination begins about the intended ordinary or extraordinary termination of the employment contract. 

Employee statement

The employer must provide the affected employee with the opportunity to comment on termination and state his position. This does not apply in cases of termination due to business reasons.

6.4. Special dismissals protection

Requirement of approval

The following occupational groups enjoy particular statutory protection against termination:

• member of a workers’ council, a works’ representative, other employees representatives and an appointed or elected trade union representative;
• if an employee is 58 years of age or older or lacks no more than 5 years until he reaches the minimum requirements for retirement (elderly employees), then written approval is necessary for the termination of the affected employee’s contract for business reasons;
• disabled persons (category II and III): only upon fulfilment of the conditions laid down in the regulations governing pension and disability insurance or in the regulations governing employment rehabilitation and the employment of disabled persons; and
• pregnant women, women breastfeeding a child of up to one year of age and parents while on a parental leave in the form of a full absence from work as well as one month succeeding such a leave: only for reasons of extraordinary termination or if the employer’s company is being wound up. Preliminary consent from the labour inspector is necessary here.

6.5. Involvement of trade union representatives

Intervention of the trade union in advance

If so requested by the employee, the employer must inform in writing the trade union the employee belongs to when termination begins about the intended ordinary or extraordinary termination of the employment contract. The trade union may give its opinion within six days and may oppose the termination if it considers that there are no substantiated reasons or that the procedure was not implemented in accordance with the ZDR-1. Irrespective of its opinion, the employer may terminate the employment contract of the employee.

6.6. Termination with an offer of a new employment agreement

Termination with offer of new employment

According to Article 91 of ZDR-1 the employer may, when terminating an employment contract for business reasons or because of the employee’s incompetence, also offer the employee a new employment contract for another job position. The new job position can be either appropriate or inappropriate for the employee. Employment is deemed appropriate if the same type and level of education is required for the new employment as was required for the performance of work under the employee’s previous employment, whereby the same working time as under the previous agreement must be agreed upon. In addition, the journey from the employee’s place of residence to the place of work must not take more than three hours in both directions by means of public transport or via the transport organised by the employer.

The employee has to conclude a new employment contract within 15 days of such offer being made. If the employee accepts the offer for an appropriate job position with an indefinite term contract, the employee is not entitled to a severance payment (this right will transfer until/if the employment relationship is terminated in the future). The employee’s right to judicial protection is not affected by acceptance. If the employee does not accept the offer for an appropriate job position with an indefinite term contract, the employee loses his right to severance payment.

If the employee is offered an inappropriate job position and does not accept it, the employee is entitled to a full severance payment. If the employee accepts such an offer, the employee is entitled to a proportionate severance payment to the amount agreed with the employer (not stipulated by law).

Legal basis 

The transfer of an undertaking or a part of the undertaking is regulated under ZDR-1.

Automatic transfer of employment relationships

If an undertaking is transferred, all rights and duties from the employment relationship which exist on the day of the transfer between the transferring employer (transferor) and the employees are assumed by the receiving company (transferee).

The transfer of an undertaking may not negatively affect the employees. The transferee must observe all rights pursuant to the collective bargaining agreement applicable to the transferor for the duration of one year after the transfer of the undertaking, unless the collective bargaining agreement expires or a new one is concluded prior to this.

If an employee terminates the employment contract as a result of an objective deterioration in his rights and within two years of the transfer whilst employed by the transferee, such employee is entitled to the same rights that he would have been granted if the employer had terminated the employment relationship for business reasons (among others, severance payment). The contract of the employee should be taken into account by both employers with regards to the duration of the notice period, the amount of severance payment and other rights.

If, after the transfer of employees, the transferee terminates the employees’ employment contracts due to the liquidation of the company, the transferor who is the predominant owner (holding more than 25% or more of the share capital) of the transferee is jointly liable to employees for their claims against the transferee arising no later than two years after the transfer. If the employers are not connected companies, the transferor is only subsidiarily liable (i.e. if the transferee fails to pay them).

Notification of union and workers’ council

The former employer as well as the future employer must notify the competent union representative or the workers’ council of a transfer of business and provide the information in this regard at least 30 days in advance.

Furthermore, efforts must be made to reach a mutual agreement with the union or workers’ council at least 15 days before the transfer on all the legal, economic and social consequences of the transfer of business. If there is no trade union at the employer’s undertaking, the employees must be adequately informed about the transfer.

8.1. Unions and business management

Management of the company 

According to the Workers Participation in Management Act, the employees can participate in the management of the company as employees’ representatives. Said representatives shall sit:

• in the supervisory board or in the management board (company with two-tier system of management), or
• in the management board (company with one-tier system of management).

The number of employees’ representatives in the supervisory board shall not be less than 1/3 of all the members and not more than ½ of all members of the supervisory board.

The number of employees’ representatives in the management board is determined by the following formula: one employees’ representative for every 3 members of the management board.

8.2. Union influence, employer associations

In practice, representation by unions is more widely spread than representation by workers’ representatives.

The interests of the employers are in generally represented by the Slovenian Chamber of Commerce. Besides this, several other associations represent the interest of the employers: the Association of Employers of Slovenia, the Chamber of Craft and Small Business of Slovenia etc.

8.3. The establishment of workers’ representation entities

The establishment of employee representation entities (such as workers’ councils in larger companies or individual works’ representatives in smaller companies) is not mandatory. Pursuant to the ZSDU, employees are free to organise and establish their own representation entities. A large number of companies, particularly small ones, do not have any workers’ representation entities in place.

Workers’ councils may be formed in companies with more than 20 employees who have active voting rights upon the employees’ request. In smaller companies, the function of the workers’ councils is performed by an individual worker’s representative, known as a worker’s trustee.

8.4. Rights of workers’ representation entities

Right to notification and access to relevant information

Workers’ representation entities are entitled to notification (particularly to study the relevant documents) regarding any modifications of the work process, the economic situation of the company, progress with regards to company goals, annual reports and modification of the company objectives.

Consultancy obligation

If new developments occur with regards to human resources issues, the health and safety of employees and the statutory legal position of the company (such as a modification of the internal acts, sale of the whole or a large portion of company, liquidation of the company as well as any change in its ownership) then, prior to adopting a resolution, the employer must consult workers’ representation organisations. 

Right to co-decision

In certain cases, the employer is only authorised to adopt a measure/decision with the agreement of representational organisations or after having already been granted consent (e.g. regarding the measures for the evaluation of the performance of employees or promotions, measures on decisions about the annual leave etc.). The workers’ council has to take a position on the proposals for the decisions/measurements of the employer within a period of eight days. If a decision is not taken, it is assumed that the workers’ council agrees with the proposal.

Veto and arbitration

Workers’ representatives have the power to veto employer’s resolutions (but must initiate arbitration) if the employer violates the employees’ rights to notification or does not consult workers’ representatives, even if the employer is obliged to do so pursuant to the provisions of the ZSDU.

If conflicts arise, the arbitration procedure shall be defined by the relevant provisions of the ZSDU.

Termination of employment relationship

Pursuant to the provisions of the ZDR-1, workers’ representatives enjoy special protection from termination of their employment relationship for the period of their representational activity as well as for the duration of one year thereafter. Representatives may only be dismissed with the consent of the relevant union or the organisation that elected them.

8.5. Garden leave 

Right to garden leave

The institute of garden leave is not specifically regulated in Slovenia. During the notice period, the employer and employee have the same rights and obligations as before notice was served, meaning that work continues as usual. However, ZDR-1 provides for an exception to this rule if termination is due to behaviour which fulfils the legal elements of a criminal offence. In this case, the employer may prohibit the employee from performing work during the period, in exchange for compensation amounting to 50% of the average monthly salary in the last 3 months before termination. 

Please note that in practice some employers enable employees to stay at home during the notice period if the employer is no longer able to provide work to the employee after the termination notice was served due to business reasons or incapacity. In such cases, the employee is entitled to 100% salary compensation.

8.6 Provision to provide material conditions for work

Working space

The employer is not statutorily obliged to provide unions or workers’ representation organisations with any equipment or resources in order to pursue their functions. However, the employer must provide sufficient working space for these organisations.

8.7. Adoption of internal acts

Before adopting an internal act that regulates the organisation of working process and the rights and duties of the employees, the employer is obliged to notify the unions and/or the workers’ council, which have 8 days to state their opinion. The employer is obliged to consider their opinion, but is not obliged to consider this when making a final decision.

If neither a workers’ council nor a union exist at the employer’s undertaking, the latter shall notify the employees in a manner which is common practice in the company.

Courts

Disputes resulting from employment relationships are settled in front of the Labour and Social Courts, which consist of one professional judge and two lay-judges. Specific matters may however also be decided by a single judge. An appeal to the Labour and Social Court can be lodged with the Higher Labour and Social Court in Ljubljana. Finally, parties may seek legal remedies against the decisions made by the Higher Court in front of the Slovenian Supreme Court. 

Arbitration

ZDR-1 promotes a peaceful settlement of labour disputes by providing for procedures prior to a court dispute such as arbitration and/or mediation by an independent third party or by a labour inspector.

Parties to the employment contract may decide to settle their dispute by means of mediation. If the latter is not successfully completed within 90 days, the employee then has 30 days to file a lawsuit before the competent court.

Employers and employees may arbitrate any other disputes resulting from the employment relationship, if agreed upon in writing. All provisions relevant to the arbitration procedure are stipulated in ZArbit.

Thus, an individual labour dispute may also be settled in an arbitration procedure, if so prescribed in the applicable collective bargaining agreement.

According to the Collective Agreements Act, the procedure for settling collective labour dispute should be first agreed upon in negotiations. The collective labour dispute should only be settled by mediation or arbitration if this fails. Pursuant to ZSDU, arbitration in a collective labour dispute between the employer and the workers’ council is a prerequisite for any further proceedings in a court of law. Any party may initiate arbitration by suggesting this procedure to the counterparty (by naming the first member of the arbitration board). The second member of the board must be nominated by the counterparty, whereas the third member shall be mutually nominated. Such an arbitral award is final.

General

Slovenian social insurance covers illness (after the 21st day of a non-occupational illness and after the 31st day of an occupational illness), unemployment and disability. 

10.1. Social insurance charges

Social insurance

Currently, employers must pay social security contributions amounting to 16.1 % of gross monthly salary and the employee must pay 22.1 % of gross monthly salary.

Health insurance

Currently, health insurance contributions amount to 6.56 % of the gross monthly salary for the employer and 6.36 % for the employee. 

10.2. Statutory retirement age

Pursuant to the Pension and Disability Insurance Act, the statutory retirement age is 65 with 15 years of insurance coverage for men and for women or the age of 60 with 40 years of pensionable service without supplementation. 

The right to a pension may only be acquired at a lower age in certain very limited cases. The age required for retirement can be decreased if an employee has, for instance, cared for his/her children, served in the army, worked before his 18th birthday and thus begun into the insurance scheme, etc.

10.3. Pension calculation

The employee´s exact pension depends on the employees’ income over a certain period of time (the average salary of the best 24 consecutive years after the year of 1970 is taken into consideration) and the total amount of months the employee has contributed to the pension fund.

Average pension amount

Currently, the average net pension amounts to EUR 820.74 (May 2023). 

Maximum pension amount

Currently, the maximum net pension amounts to EUR 3,790.70 (May 2023). 

10.4. Private retirement pension schemes

Pension fund

Aside from the statutory retirement pension, employees may also conclude pension plans with private retirement pension insurance providers.

Both individual and collective pension schemes are possible. However, a prerequisite for an additional collective pension is that the employer subscribes to an already existing retirement insurance fund or establishes such a fund himself. The employer is obliged to insure all employees who decide to join the additional retirement insurance plan.

Deductibility 

Employers who pursue the option of establishing a private pension fund may, pursuant to certain conditions, claim a reduction on their corporate income tax basis for up to 24% of the obligatory pension and disability contributions paid per insured employee, but no more than EUR 2,390 per year. Amounts equal or lower than the latter limits are not considered income from employment from the employee’s perspective.

10.5. Unemployment benefit schemes

Entitlement to unemployment allowance

An employee who has lost his job and is registered with the Employment Service of Slovenia is entitled to unemployment allowance if he was employed for at least 10 (or 6 months, should an individual be below the age of 30) months in the last 24 months. Unemployment allowance is granted for a maximum of 25 months.

Amount of unemployment allowance

The amount of unemployment allowance is calculated based on the average salary the employee received in the 8 months prior to the month when his employment was terminated. 

In the first three months of unemployment, the employee is entitled to 80% of the established average salary, 60% in the next nine months of unemployment and 50% after the first year of unemployment. 

The unemployment allowance may in any case not be lower than EUR 530.19 or higher than EUR 892.50. 

Financing of unemployment insurance 

Contributions to unemployment insurance are paid by the employer as well as by the employee. 

The employee pays unemployment insurance at a rate of 0.14 % of the gross salary, whilst the employer pays unemployment insurance at a rate of 0.06 % of the employee´s gross monthly salary.