Employees transfer in Romania to a new employer: Rights and obligations during the process

Rights and obligations during the process of employees transfer in Romania

According to the applicable legal provisions, the takeover of employees is possible in the event of a transfer of the undertaking, the unit, or parts thereof, in accordance with Article 173 of Law No. 53/2003 – the Labor Code, republished with subsequent amendments and completions, as well as the provisions of Law No. 67/2006 on the protection of employees’ rights in the event of a transfer of an undertaking, a unit, or parts thereof.

Taking into account the provisions of Article 173 paragraph (2) of the Labor Code, in conjunction with Article 5 paragraph (1) of Law No. 67/2006, all rights and obligations of the transferor (the person who ceases to be the employer of the employees) arising from the individual employment contracts and from the collective labor agreement in force at the time of the transfer shall be fully transferred to the transferee (the person who becomes the employer of the employees).

The employees transfer in Romania cannot constitute grounds for individual or collective dismissal of employees by either the transferor or the transferee, as provided in Article 173 paragraph (3) of the Labor Code and Article 7 of Law No. 67/2006.

As a result of the assignment/merger, the transfer of employees also occurs implicitly. Therefore, the rights and obligations of employees arising from existing employment contracts are fully transferred to the transferee.

In the case of employees transfer in Romania, individual employment contracts continue to produce legal effects, being taken over by the new employer. The transfer implies a modification of the individual employment contract regarding the employer and possibly the place of work. This modification occurs on the date of the transfer of the undertaking, unit, or parts thereof, being expressly provided by law and not representing the willful agreement of the parties (employee – employer).

Individual employment contracts and the employees transfer process

Individual employment contracts are not terminated; instead, they are transferred to the transferee, who becomes the new employer under the terms of the merger/assignment contract concluded between the two companies, which must also include provisions regarding the transferred employees. Prior to the date of the transfer, both the transferor and the transferee are obligated to inform in writing the employees’ representatives or, if such representatives have not been established or appointed, their own employees, at least 30 days before the transfer date, regarding:

a) the date of the transfer or the proposed date of the transfer;
b) the reasons for the transfer;
c) the legal, economic, and social consequences of the transfer for the employees;
d) any measures envisaged in relation to the employees;
e) the working and employment conditions.

Additionally, pursuant to Article 174 of the Labor Code, the transferor and the transferee are required to inform and consult, prior to the transfer, the trade union or, as the case may be, the employees’ representatives regarding the legal, economic, and social implications of the transfer of ownership on the employees.

Furthermore, according to the provisions of Article 9 of Law No. 67/2006, the transferee is obligated to comply with the provisions of the collective labor agreement applicable at the time of the transfer, until its termination or expiration.

By mutual agreement between the transferee and the employees’ representatives, the clauses of the collective labor agreement in effect at the time of the transfer may be renegotiated, but not earlier than one year from the date of the transfer. According to Directive 2001/23/EC, in conjunction with Article 8 of Law No. 67/2006, if the transfer results in a substantial modification of the working conditions to the detriment of the employee, the employer is held responsible for the termination of the individual employment contract.

Thus, if the employment contract is terminated, the employer is considered liable only to the extent that the employee has suffered damage as a result.

However, if the contract termination occurs at the employee’s own initiative, through resignation, without any negative impact on their rights or working conditions, the employer is no longer considered responsible for the termination of the employment relationship.

Nevertheless, it should be noted that the employees transfer in Romania must be recorded in the General Register of Employees – REGES-ONLINE, taking into account the fact that the employees will be working for a new employer.

Denisa Toboșaru

Payroll Legal Counsel | Accace Romania

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