The National Assembly of the Republic of Serbia adopted amendments to the Law on Agency Employment

On 06. December 2019, the National Assembly of the Republic of the Serbia adopted the Law on Agency Employment (the “Law”), published in the Official Gazette No. 86/2019 dated 06 December, 2019, effective eight days after publishing in the Official Gazette on 14 December 2019. The application of the Law shall begin on March 1, 2020, while the application of certain provisions shall begin on January 1, 2020.

This Law regulates the rights and obligations of employees, employed at the Agency for Temporary Employment for the purpose of assigning a temporary employee to a beneficiary employer. The Agency for Temporary Employment (“Agency”) is defined as a company or entrepreneur registered with the competent authority, which employs an employee for his / her temporary assignment to a beneficiary employer, in the territory of Serbia, and for the purpose of performing tasks under beneficiary employer supervision and management. The Agency may only perform the work of assigning of employees if it has obtained a work permit (“Permit”) issued by the Ministry responsible for labor affairs. The Law prescribes conditions that the Agency must meet in order to secure a Permit. Supervision in the procedure for obtaining the Permit, regarding the fulfillment of the conditions by the Agency, is performed by the labor inspection. The Permit is issued for a period of five years, and upon expiration can be renewed. The Law also regulates the revocation and termination of the Agency’s Permit. An Agency with a temporary employee may conclude an employment contract for an indefinite or definite period of time. The definite period of time is equal to the time of the transfer to the beneficiary employer. If an Agency concludes an agreement with an employee for an indefinite period of time in addition to the elements prescribed by the Labor Law, the agreement must also contain the type of work for which the employee will be assigned, as well as that the employee accepts to perform work for the beneficiary employer. The elements of the contract concluded by the Agency with the beneficiary employer are also prescribed in detail. The Law limits the number of assigned employees at the beneficiary employer to 10% of the total number of employees directly employed by the beneficiary employer. These 10% do not include persons who have an employment contract for indefinite period of time with the Agency. If the employer has fewer than 50 employees, the Law prescribes how many assigned employees are to be hired. The Law explicitly revokes the effect of a potential provision in a contract of employment with the Agency or a contract of assignment that prohibits the direct hiring of assigned employee by the beneficiary employer. The duration of the assignment is limited and it is the same as employment for definite period of time prescribed by the Employment Act. The Law prescribes the same working conditions for assigned employees as for employees directly employed by the beneficiary employer. The Law prohibits the Agency from charging an assigned employee for a temporary assignment service with the beneficiary employer. If an assigned employee concludes an employment agreement for indefinite period of time with the Agency, such employee has the right to salary between the two assignments to the beneficiary employer. Both the Agency and the beneficiary employer are obliged to ensure the protection of personal data in accordance with the provisions of the Law on Personal Data Protection. The Law also provides for the collective rights of assigned employees in accordance with international standards of the International Labor Organization and the European Union. The Labor Inspectorate supervises the implementation of the Law.

The Law was adopted to align the field of labor legislation with the standards of the International Labor Organization and the European Union. Although until now there was no law governing the work through Temporary Employment Agencies, such agencies existed in practice. The Law was adopted for this reason, in order to provide, for persons employed by the Temporary Employment Agencies, equal pay, working hours, Holiday, and other conditions provided for persons directly employed by the employer.