07.06.2023

SOCIAL PROTECTION WHEN WORKING WITHOUT AN EMPLOYMENT CONTRACT AND IN CIVIL CONTRACT

It is a known practice for some employers to appoint their employees instead of a labor contract, on a civil contract, actually requiring the worker and the employee to observe the working hours, to be actively present in the labor process and in absolutely all elements of the obligations that are characteristic of the employment relationship.

What are the practices regarding the conclusion of civil contracts and is it always aimed to conceal legal requirements when forming the employee-employer relationship?

In essence, such a practice is a circumvention of the law, because it aims to achieve an impermissible result with in principle permitted legal means, and in this case everything is at the expense of the employee. The impermissible result consists in the reduction of the social protection which the labor law gives to the worker or employee.

By paying in the form of a "honorarium" under a civil contract, the worker does not benefit from the guarantees provided for labor remuneration. This means that, unlike an employment contract, a civil contract can generally be terminated much more easily by the employer and the worker can be left without legal protection "on the street", because the insurance under a civil contract does not cover all insurance risks, etc.

This is also the reason why such a practice is defined as vicious and it is highly recommended that the worker or employee does not agree to such a payment scheme, even though it seems tempting and in the interest of both parties at first sight.

Of course, not in all cases the conclusion of parallel labor and civil contracts is a matter of choice for the employee. More often, this situation is the result of a kind of pressure exerted by the employer.

In these cases, the control bodies for compliance with labor legislation, and more specifically - the Labor Inspectorate, should exercise their powers and declare the concluded civil contracts as labor contracts, because they involve labor and they violate the rule of relations in the provision of workforce to be regulated only as employment relationships.

According to the law, when such a violation is found, the existence of the employment relationship is announced by a decree of the Labor Inspectorate. It also defines the starting date of the employment relationship.

Fairness requires noting that civil contracts with the employer are not always illegal. It is not uncommon for the parties to an employment relationship to agree that the worker or employee will provide the employer with a service that is outside the scope of his employment obligations. In these situations, the subject of the civil contract is described by the specific result - making an object, delivering a lecture, filming an event, etc.

An example of a lawful civil contract accompanying the employment relationship is, for example, the provision of a service by the employee, which is not related to the fulfillment of the obligations under the employment contract.

Reference:

Art. 1, para. 2 of the Labor Code

Art. 405a, para. 1 of the Labor Code