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Hiring in Romania
Background checks in Romania
Hire employees in Romania
Language used in Romania
Payroll set up in Romania
Global expansion made easy
Employer of Record (EoR) in Romania
With its well-educated workforce and competitive costs, Romania has become an attractive market for companies looking to build a highly skilled pool of talent. The country is producing a steady stream of skilled professionals in areas like software development, engineering, and IT services. As one of the prominent tech talent hubs in Europe, Romania is a prime destination to source highly skilled talent.
If you are planning to hire workers in Romania, you need to set up a legal entity in order to conduct business in the country. However, setting up an entity can be costly and time-consuming, which can slow down your momentum. Fortunately, there are other approaches you can take aside from setting up an entity to hire talent in Romania. One approach is through an employer of record (EoR).
What is an employer of record (EoR)?
An employer of record or EoR is a third-party service provider that enables companies like yours to hire talent in different countries or regions where you do not have a local entity. If you want to hire talent in Romania, the employer of record can handle the formal employment responsibilities on your behalf.
That means the EoR in Romania will take on responsibilities of administrative and HR tasks such as taxes, payroll, benefits, and compliance, while you manage the day-to-day tasks and performance of the employee.
This allows your company to compliantly expand into new markets, reducing administrative burdens and minimising legal risks associated with international hiring. As an employer, ensure that you partner with a reliable employer of record service provider, such as CXC.
With the help of an EoR service provider, you can hire talent in Romania and other countries without worrying about administrative burdens that come with hiring international talent. You’ll also have access to their in-depth expertise, which may help you, especially if you are unfamiliar with the local market.
In this guide, we will provide everything you need to know to compliantly hire talent in Romania, including how to conduct an employee background check, your hiring options, language requirements, payroll setup and more. In this way, you can confidently expand your presence and establish a strong local team in Romania.
Hiring in Romania
There are various employment laws and regulations you need to keep in mind when hiring in Romania. From employment contracts to working hours, you must understand the regulations around them to ensure compliance.
Hiring laws in Romania
- Romanian Labour Code (Legea nr. 53/2003): This covers a wide range of regulations, including terms and conditions of employment, employment rights, and employer obligations. As an employer, it is your responsibility to ensure that your employment contract, benefits, and working conditions are aligned with the Labour Code.
- Fiscal Code (Law No. 227/2015): It provides guidelines on taxation aspects related to employment, such as income tax and mandatory deductions. Understanding your tax obligations as a company can ensure correct and timely payroll and avoid hefty penalties that could derail your growth.
- Non-discrimination: The labour law in Romania also prohibits anti-discrimination. This means that during the hiring process, decisions cannot be based on race, gender, age, nationality, religion, sexual orientation, or any other personal characteristics not directly related to the job requirements.
- Law no. 16/2017 or special contracts for foreign workers: For companies hiring foreign workers or sending employees to work abroad temporarily, specific contractual arrangements and registrations might be necessary under law no. 16/2017, which covers the movement of employees as part of international service agreements.
Hiring employees in Romania
When it comes to hiring employees in Romania, it is mandatory for employers to draft written contracts in the Romanian language. These contracts must also be registered with the Employees’ General Register. Typically, employment contracts in Romania are open-ended to offer employees stability and security in their roles.
Aside from regulations on written contracts, you should familiarise yourself with the local labour code, which states that a standard working week in Romania is 40 hours or eight (8) hours per day. Employees are also entitled to a minimum of 20 days of paid annual leave. As an employer, you are responsible for ensuring a safe and healthy working environment for your workforce.
Hiring contractors in Romania
In Romania, the Labour Code governs employees, while civil law and commercial contracts govern independent contractors.
To be considered an independent contractor, the individual should retain control over how, when, and where they complete their work. They should also have autonomy over the tools and methods used to complete tasks and should not be subject to direct supervision.
Employers must understand the difference between employees and independent contractors to avoid misclassification risk. For example, setting a fixed work schedule, requiring a worker to be at the company’s office, or closely managing work processes could lead to reclassification as an employee. It is best to avoid such practices to remain compliant with the local labour laws and regulations.
Other key factors you need to know when engaging with independent contractors are:
- Written service agreements: Independent contractors should have a clearly written service agreement (in Romanian or bilingually), specifying project scope, deliverables, compensation, and contract duration. Clearly outline the contractor’s responsibilities, milestones, and payment terms. This reduces ambiguity and helps differentiate contractors from employees.
- Tax obligations: Independent contractors are responsible for handling their own tax obligations, including income tax (10% flat rate), social contributions (usually around 25%), and health insurance contributions. Employers are not required to withhold income tax or social security for contractors, which reduces administrative burdens. However, contractors are expected to report and pay these themselves.
- GDPR compliance: If the contractor handles personal data, ensure compliance with GDPR by specifying data protection protocols in the contract and obtaining any necessary consents.
Background checks in Romania
Conducting employee background checks in Romania must be done with care and in compliance with local labour laws and regulations.
Before initiating any background checks, you must obtain written consent from the candidate to comply with data protection regulations and the General Data Protection Regulation (GDPR).
All employers must ensure their background check processes are in full compliance with the GDPR. Pay close attention to the legal grounds for processing personal data, implement data protection measures, and respect candidates’ data protection rights.
Employee background checks in Romania
When conducting a background check in Romania, you should focus only on information that is directly relevant to the job, such as employment history and education verification. Avoid collecting extra personal details that do not relate to the requirements of the job position.
In addition, the background check process must be free from discriminatory practices. This means using the information gathered without bias and ensuring that candidates aren’t treated differently based on race, colour, sex, religion, political opinion, national or social origin, or other protected characteristics.
What are the common types of background check conducted in Romania?
The common types of background checks include verifying the candidate’s employment history and education qualifications. This allows the company to verify the candidate’s previous employment, including roles, date of employment, and in some cases, reasons for leaving, educational degrees and relevant qualifications to ensure accuracy and that the candidate meet job requirements.
If relevant to the job role, an employer may request a criminal record check. Each of these background checks requires the candidate’s consent and must be directly related to the job requirements.
Criminal background checks in Romania
While criminal background checks are not universally required for all types of employment in Romania, they may be necessary for positions that entail a certain level of trust or security clearance.
Some specific industries, such as finance, education, and healthcare, may require criminal background checks by law. Employers in these fields often need to verify that candidates have a clean record.
Before conducting a criminal background check, you must obtain written consent from the candidate due to privacy laws and GDPR requirements. Conducting background checks without consent are not permitted.
The main way to verify a criminal record is by asking the candidate to provide an official Certificate of Criminal Record (Cazier Judiciar). This document can be obtained from police stations or online through Romanian government portals and shows whether the candidate has a criminal history in Romania.
In certain cases, employers may request the certificate directly, but this typically requires specific legal justification and the candidate’s consent.
Romanian requirements for criminal background checks for immigrants
As with all background checks in Romania, you must first obtain written consent from the immigrant candidate. This consent is essential due to GDPR and Romanian privacy laws, as personal information must be handled carefully and with transparency.
Aside from providing Certificate of Criminal Record from Romanian authorities, immigrants are often required to present a similar criminal record certificate from their country of origin or any country they’ve resided in for an extended period. Many countries have embassies or consulates in Romania where this document can be requested, or it may be accessible through a police authority in the home country.
Immigration status alone isn’t a valid reason to conduct a criminal background check. Requirements should be the same for Romanian citizens and foreign nationals unless a specific law mandates otherwise.
If a criminal record is presented in a language other than Romanian, employers may require an officially translated and notarised version. This ensures that all information is accurately understood. Some employers may also need to verify the authenticity of foreign criminal records through apostille certification or embassy/consulate verification, depending on the origin country’s regulations.
Employers must use the information responsibly, without discriminating based on nationality or unrelated criminal history.
Immigration compliance in Romania
European, European Economic Area, and Swiss nationals have the right to live and work in Romania, but they must follow the local regulations. For example, they need to get a registration certificate if they stay for more than three months.
On the other hand, other nationals, must meet specific immigration-specific requirements for entry, stay, and work requirements in Romania. Employers engaging with foreign nationals have legal responsibilities and must ensure adherence to the local labour laws and regulations.
Other pre-hire check requirements in Romania
Employers can only request a medical certificate or check to confirm that a candidate is physically fit to do the job. Typically, the employer is responsible for covering the cost of this check.
Hire employees in Romania
Employee in Romania
An employee in Romania is an individual who carries out work for an employer, under their authority, and receives compensation for their labour. This type of employment is regulated by the country’s Labour Code (Law No. 53/2003) and includes specific rights and obligations.
Employees in Romania are entitled to various labour protections, such as paid annual leave, sick leave, maternity/paternity leave, health and safety protections, and social security benefits.
Typically, they have an indefinite contract, and they can also be on a full-time or part-time basis. Fixed-term and part-time employees have the right to be treated equally and should not face discrimination based on their employment status. This means they should have access to the same working conditions, benefits, and protections as full-time and permanent employees, proportionate to their hours or contract duration.
Employers are expected to ensure that part-time and fixed-term workers are provided with fair pay, access to training, career development opportunities, and other employment rights similar to those of regular employees.
Independent contractor in Romania
An independent contractor, often referred to as a freelancer or self-employed individual, provides services or completes projects for client based on a civil contract rather than an employment contract.
Independent contractors typically work under a service provision agreement (contract de prestări servicii) or another civil contract that outlines the scope of work, deliverables, deadlines, and payment terms. They do not have the same rights or obligations as those under an employment contract.
Unlike employees, independent contractors work autonomously and are not under the employer’s direct supervision or control. They are responsible for managing their own taxes and social contributions. Many independent contractors in Romania register themselves as self-employed individuals (PFA, or Persoană Fizică Autorizată) or through other legal entities to issue invoices and handle their own tax obligations.
As an employer, you must establish a contractual agreement with an independent contract to avoid confusion between a civil professional relationship and an employment relationship. This ensures protection from potential misclassification risk.
Since independent contractors are not employees, they are not entitled to benefits such as paid leave, unemployment benefits, health insurance, or other protections offered under the Labour Code.
Agency worker in Romania
An agency worker is an individual employed by a temporary work agency but assigned to work temporarily for a client company (also called the “user enterprise”). The relationship and rights of agency workers are governed by Romanian labour laws, particularly Law No. 53/2003 (the Labour Code) and Law No. 16/2017, which specifically addresses temporary agency work.
The agency worker has an employment contract with the temporary work agency, which is legally responsible for paying their wages, handling social contributions, and managing other employment-related obligations.
Romanian law requires that agency workers receive the same basic working conditions and pay as the client company’s regular employees performing similar tasks. This includes comparable wages, working hours, overtime rates, and access to workplace amenities and benefits.
While agency workers perform tasks under the supervision of the client company, they do not have a direct employment contract with it. The user enterprise does not hold direct employer responsibilities but must ensure fair treatment and workplace safety.
Language used in Romania
Generally, the language used in employment contracts and the workplace is Romanian, the country’s official language. The local labour law also mandates that employment agreements and official employment documents, such as job descriptions and safety instructions, must be in Romanian. Employers can also choose to provide a bilingual version (including Romanian and another language), but the Romanian version will be the legally binding one.
Any legally required training materials, safety information, or manuals should be available in Romanian to ensure all employees can comprehend essential health and safety guidelines.
While it’s not mandatory for internal policies or regulations to be in Romanian, it is recommended to do so to ensure that all employees can clearly understand company rules, which can be especially important for health and safety guidelines and other workplace standards.
For foreign employees who don’t speak Romanian, companies may offer materials in another language (e.g., English), but this does not replace the need for Romanian versions in official documentation.
Payroll set up in Romania
To set up payroll in Romania, you must first register your business as a legal entity. This involves choosing the appropriate legal structure, such as a limited liability company (SRL) or a joint-stock company (SA) and registering with the Romanian Trade Registry. Once registered, you must also obtain a tax identification number (CIF) from the National Agency for Fiscal Administration (ANAF).
You can then decide whether to use payroll software or outsource payroll processing to a third-party provider. However, taking the route of setting up a legal entity is often costly and time-consuming. This could slow down your growth momentum, and you may possibly lose the highly skilled talent from competition.
The good news is that there are other alternative ways to establishing an entity, such as using employer of record (EoR) services. You can partner with a reliable employer of record provider, such as CXC, to handle the hiring, payroll, and compliance aspects on your behalf while you manage the employees’ day-to-day tasks. This way, you don’t have to worry about administrative burdens that come with hiring internationally.
Corporate setup in Romania
While the Romanian Labour Code primarily expects companies to have a formal Romanian entity for hiring employees, it does not explicitly forbid foreign companies from directly entering into individual employment agreements with Romanian residents. This means that a foreign business can legally hire staff in Romania, but doing so may come with certain challenges, especially related to payroll and taxes.
For instance, foreign companies might face difficulties in managing payroll taxes or ensuring compliance with Romanian labour laws without a registered entity. This can lead to complications in withholding the correct amount of taxes from employees’ salaries or understanding local regulations regarding employee rights and benefits.
Therefore, while hiring directly is possible, foreign entities must carefully consider the implications of such arrangements, including business registration, tax responsibilities, and the legal framework for employment. Consulting with local legal and tax experts can help navigate these complexities and ensure that all regulations are met, making the process smoother for both the company and its employees.
Global expansion made easy
Hiring employees in Romania usually means setting up a legal entity, which can be costly and time-consuming. Employers can avoid this hassle by working with an Employer of Record (EoR), like CXC.
Through our EoR solution, you can confidently hire employees in Romania, without worrying about compliance issues. We’ll handle everything from payroll to benefits to employment contracts on your behalf — so all you have to think about is finding the right person for the job.
Speak to our team and learn how we can support your global expansion journey in more than 100 countries worldwide.
Compliantly hire workers anywhere with CXC
With our EoR solution, you can engage workers anywhere in the world, without putting your business at risk. No more worrying about local labour laws, tax legislation or payroll customs — we’ve got you covered.
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