All employment relationships come to an end — and Bosnia and Herzegovina has specific legal frameworks that govern how that happens. These rules vary between the country’s two main entities: the Federation of Bosnia and Herzegovina (FBiH) and Republika Srpska (RS). For instance, both entities permit termination of employment for economic or performance-related reasons, but procedures and notice periods differ.
In this section, we’ll guide you through the statutory notice periods for both employers and employees in Bosnia and Herzegovina, as well as the procedures that must be followed when ending an employment relationship. We’ll also cover probationary periods, severance pay entitlements, and the rules around dismissals. Finally, we’ll explain what happens when a business or part of a business changes hands and how employee rights are affected in such transfers of undertakings.
Both employers and employees need to give a certain amount of notice to end their employment relationship. Statutory notice periods are usually defined by labour laws, though collective bargaining agreements and individual policies and contracts can also have an impact.
In Bosnia and Herzegovina, statutory notice periods for terminating employment contracts vary across its administrative regions: the Federation of Bosnia and Herzegovina (FBiH), Republika Srpska (RS), and Brčko District. (BD). They are also different for employers and employees. Read on for what employers need to know about notice periods in Bosnia and Herzegovina.
In the Federation of Bosnia and Herzegovina (FBiH), employees must give at least seven days’ notice to terminate their employment agreement. This period can be extended by collective agreements or internal regulations but cannot exceed one month. In both Republika Srpska (RS) and the Brčko District (BD), the minimum notice period for employees is 15 days.
The statutory minimum notice period for employers is also different in each region, as follows:
It’s important to keep in mind that these are just the statutory minimums. Actual notice periods may be influenced by collective agreements, internal regulations, or individual employment contracts, provided they adhere to the legal limits established in each region. For example, in the FBiH, notice periods for employers can be extended to a maximum of three months.
Many employers in Bosnia and Herzegovina include probationary periods in their employment contracts. These are permissible for a maximum of six months. During the probationary period, either the employer or the employee can terminate the employment relationship by giving the other party at least seven days’ notice.
Employees in Bosnia and Herzegovina are generally entitled to severance pay if their contract is terminated for economic, technical, or business-related reasons and they have been working for their employer for at least two years. The minimum severance pay is one-third of the employee’s average salary for each full year of service.
Every country has specific rules that apply to the termination of employment to protect employees. In Bosnia and Herzegovina, termination is governed by distinct labour laws in its two primary entities: the Federation of Bosnia and Herzegovina (FBiH) and Republika Srpska (RS). We’ll go into both of them below.
Termination of employment in the Federation of Bosnia and Herzegovina (FBiH)
In the Federation of Bosnia and Herzegovina, employers can terminate an employee’s contract for the following reasons:
If the termination is due to economic, technical, or organisational reasons or if it is because the employee is not capable of performing their duties, the employer must attempt to find the employee an alternative position before proceeding with termination. If it is due to a minor violation of work obligations under the employment contract, the employee must be given a written warning before dismissal can be considered.
In Republika Srpska, the following are acceptable reasons to terminate an employment contract:
In both FBiH and RS, the employer must notify the employee in writing of their intention to terminate their contract, respecting the statutory notice period defined by local labour laws. The dismissal notice must include the reasons for dismissal and must be delivered to the employee. If it can’t be delivered, the employer can publish the dismissal notice on a bulletin board on the employee’s premises.
Labour laws in Bosnia and Herzegovina also contain provisions to protect employees from unfair dismissal. If a court determines that a dismissal was unlawful, they may require that the employer reinstate the employee in their former position or pay redundancy pay them in accordance with the law, any collective agreements that apply, and the employee’s written employment contract.
Post-termination restraints are restrictions that employers can put on their employees after their employment contract is over. They are designed to protect the employer’s interests by preventing the employee from engaging in any activity that competes with the primary business of the employer. Post-termination restraints are sometimes called post-termination restrictions or restrictive covenants.
Employment law in both the Federation of Bosnia and Herzegovina (FBiH) and Republika Srpska (RS) provides for a statutory non-competition clause that prevents employees from contracting or performing work within the business activities of their employer without their prior approval. This applies only during the employment contract.
In addition, employers and employees in FBiH can agree on an additional restrictive contractual covenant to prevent employees from working for or forming a competing business after the termination of their employment contract. The term of a restrictive covenant can’t exceed two years, and the employer must compensate the employee with at least 50% of their average salary during the restricted period for it to be valid.
The rules in RS are very similar, apart from the following differences:
Non-solicitation clauses are another type of post-termination restraint. They are designed to prevent employees from soliciting or ‘poaching’ employees or clients from their former employers. Non-solicitation clauses are not specifically regulated by labour laws in Bosnia and Herzegovina. However, they do exist in practice.
In some countries, employees can waive certain employment rights as part of a settlement agreement. In Bosnia and Herzegovina, employees may be able to waive acquired rights, but a waiver of future rights is unlikely to be legally enforceable. Employers in Bosnia and Herzegovina should seek expert legal advice before asking an employee to sign a waiver to ensure it is legally binding.
A transfer of undertakings is when a business or part of it is transferred from one employer to another, for example due to the sale of the company. In these circumstances, the employees of the transferred company typically have certain rights under employment law. Read on to learn about the rules concerning transfers of undertakings in Bosnia and Herzegovina.
In Republika Srpska (RS), the law states that after a transfer of undertakings, the new employer is obliged to assume all existing employment agreements and general regulations that were in effect on the date of the transfer. This means that terms and conditions of employment, including tenure, salary, and other benefits, must be preserved under the new employer. Currently, no such provisions exist in the law of the Federation of Bosnia and Herzegovina (FBiH).
There are many different ways an employment contract can come to an end. But whatever the situation, you need to understand the rules that cover the end of employment in Bosnia and Herzegovina — or you could end up facing legal issues.
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