If you want to hire talent in Romania compliantly, you need to understand the laws and regulations around employment contracts. The country has strict employment regulations, and a written contract can help protect both your business and the employee.
The employment contract must establish terms and clauses, such as the employee’s job responsibilities, salary, working hours, and benefits, to reduce the risk of legal disputes.
Legal requirements for employment contract in Romania
Without a formal employment contract, you may face legal challenges as an employer, as this is legally mandated by the local labour laws. Under the Labour Code (Law 53/2003), an employment contract is legally required and must be signed in writing before the employee starts working. The contract must be in Romanian, though a bilingual version may be provided if the employee or employer is foreign.
A permanent intermittent employment contract allows employees to work on an “as-needed” basis with variable hours yet maintain a long-term employment relationship. This type of contract is particularly useful for businesses with fluctuating workloads, such as seasonal industries or project-based work, where the need for labour is not constant.
Under this contract, the employer and employee agree on a minimum number of guaranteed working hours, but the employee may only be called in to work when there is a demand. Though intermittent, the contract is indefinite, so the employee remains on the employer’s roster. Employers must specify a minimum number of hours per month or year.
Moreover, employees under intermittent contracts still qualify for social security, health insurance, and other mandatory benefits under Romanian law. They are also entitled to similar protections as full-time employees, such as the minimum wage and protection from unjust termination.
Typically, individual employment contracts in Romania are established as an open-ended (unlimited) term contract. This means that there is no fixed date for when it will end. However, you still have the option to set it for a fixed term.
Another option is a part-time agreement, which can be either open-ended or fixed term. These employment contracts must be executed in writing in Romanian, and they need to be registered with the General Register of Employees (REVISAL). The said registry is an electronic system maintained by each employer using a platform provided by the authorities and must be periodically communicated to the relevant labour authorities.
All employment contracts must be registered in Romania’s REVISAL no later than the day before the employee starts date. REVISAL ensures legal compliance and tracks employment history for tax and social security purposes.
The duration of the probationary period varies with the type of job position and what is stipulated by law. For non-managerial positions, the maximum probationary period is 90 calendar days. On the other hand, for managerial positions, the probationary period can extend up to 120 calendar days.
During the probationary period, either party can terminate the contract without notice or compensation unless otherwise agreed. It should be noted that an employee cannot be subjected to a new probationary period within a period of 12 months for the same position with the same job responsibilities if rehired by the same employer. That means an employer cannot repeatedly place an employee on probation within the same role.
Employees under a probationary period have the same rights as regular employees, including receiving a salary and social security contributions.
Employers in Romania are required to create internal regulations, often referred to as an employee handbook, which they must develop in cooperation with employee representatives. This handbook must cover basic topics, including guidelines on health and safety in the workplace, rules on discipline, procedures for raising complaints, and criteria for evaluating employee performance.
Aside from this, employers can add other job-related rules on their own, such as dress code requirements or specific duties for certain roles, either in the main handbook or as separate policies. Since May 2019, employers must also include specific policies on equal treatment and anti-harassment at work. This means they need to have a clear, zero-tolerance stance on harassment, along with actions for preventing it. They must also establish steps for quickly reporting any violations of equal treatment laws to the relevant public authorities.
In Romania, employers do not need to file their employment policies with any external organisations or outside authorities before implementing these policies.
When putting internal regulations in place, employers are required only to consult with the relevant employee representatives, such as a union or employee committee. This consultation is intended to ensure that employee feedback is considered, but employers are not obligated to come to a formal agreement or get permission from these representatives.
To ensure compliance, an employment contract in Romania must cover specific terms and details that provide clarity between the employee and employer, such as:
The express terms of an employment contract are those specifically stated within the written agreement between the employer and employee. These terms detail the rights, obligations, and conditions under which employment will occur. Express terms typically include job description, compensation, work hours, and conditions related to termination.
When it comes to contract extension, a fixed-term contract can be renewed, but it cannot exceed a cumulative total of 36 months from the start of the initial contract, including all renewals. Employers can only extend a fixed-term contract up to three times within this period.
If a fixed-term contract surpasses the 36-month limit, the law automatically considers the employment relationship as indefinite, giving the employee rights associated with permanent employment. Employers also have the option to offer indefinite contracts directly after the initial fixed term ends.
Each contract extension must be documented through a written amendment signed by both the employer and the employee, outlining the new end date and any other agreed-upon terms. The amendment should be completed before the initial contract expires.
Unlike some other jurisdictions, Romania does not allow fixed-term contracts to renew automatically. If a fixed-term contract reaches its end date without a signed renewal, the employment relationship officially ends.
The contract of an independent contractor (often referred to as a service contract or “”contract de prestări servicii””) is more flexible than employment contracts.
When extending a contract, there should be a mutual agreement between the contractor and the client. This extension should be documented in writing, typically through an addendum or amendment that specifies the new duration, terms, and any changes to the scope of work or fees.
Unlike fixed-term employment contracts, there is no legal limit on the number of times an independent contractor’s contract can be renewed. It can be extended indefinitely, if both parties agree.
To avoid misclassification, organisations must ensure the relationship remains genuinely independent even after contract extensions. Romanian labour authorities may reclassify an independent contractor relationship as an employment relationship if certain conditions are met (such as the contractor being under direct control and supervision, working exclusively for one client, or fulfilling core functions within the organisation). This can have tax and legal implications, as reclassified contracts would be subject to employment law protections and requirements.
Fixed-term contracts in Romania are allowed, but they are subject to specific legal regulations and must be justified by legitimate reasons as outlined in the local Labour Code.
It can be used under certain circumstances where an indefinite contract may not be suitable. Some of the justified reasons for using a fixed-term contract in Romania are:
While fixed-term contracts are allowed for these reasons, they cannot exceed a total duration of 36 months, including any renewals (up to three renewals within this period). After this time, the role should either transition to an indefinite contract or the employment relationship should end.
Using fixed-term contracts outside these justified reasons or exceeding the maximum term could expose employers to legal risks, as such contracts could be reclassified as indefinite, granting the employee the rights and protections of a permanent position.
The maximum legal working hours in Romania are set at 40 hours per week, distributed typically across 5 days, which translates to 8 hours per day. However, in certain conditions, the working hours can extend up to 48 hours a week, including overtime. This extension is subject to specific rules and must not breach the legal framework intended to protect workers’ health and well-being.
In Romania, full-time employees work an average of about 1,838 hours per year. This estimate assumes no unpaid leave or extra overtime, though some jobs may require additional hours based on specific needs.
If overtime is needed, it must follow Romanian labour laws, which state that total hours, including overtime, should not exceed an average of 48 hours per week over a four-month period.
International or foreign students are allowed to work while studying. Foreign students from non-EU countries must obtain a work permit to work in Romania. However, EU/EEA students do not need a work permit and can work freely.
Non-EU students need a work permit, while students from the EU/EEA do not and can work freely.
During the academic term, foreign students can work up to 4 hours per day, so their studies are not disrupted. During breaks (like summer vacations or holidays), they can work up to 8 hours per day.
Students can take on different jobs, such as part-time roles, internships, or work related to their studies, which can help with living costs and offer valuable experience. Work hours are regulated by Romania’s Labor Code to support employee well-being and work-life balance.
Employees are allowed to work a limited amount of overtime. The total working time, including overtime, should not exceed 48 hours per week on average over a reference period, which is typically set at 4 months. However, this reference period may be extended to 6 or even 12 months in specific cases defined by collective labour agreements.
The calculation of overtime pay in Romania varies based on the employee’s compensation structure. For hourly employees, overtime pay is typically calculated at a rate of 1.5 times the regular hourly rate for any hours worked beyond the standard 40-hour workweek.
Alternatively, employers can offer equivalent time off instead of additional pay, which must be taken within 60 calendar days following the overtime worked.
Certain categories of workers, such as those working in health care, emergency services, or in other critical roles, may have different regulations or additional provisions regarding overtime work.
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Law No. 81/2018 on Telework Activity defines telework, also known as remote work, as a type of work that occurs regularly outside the employer’s premises, utilising information, and communication technology. This includes both full-time telework and hybrid arrangements where employees split their time between remote work and on-site work.
Telework or remote work arrangements must be formalised through a written agreement between the employer and employee. This agreement should outline the conditions under which telework will occur, including working hours, tasks, and the necessary equipment.
Employees who work remotely should have the same rights and responsibilities as regular workers. This includes rights related to remuneration, professional development, and access to training opportunities. Employers cannot discriminate against teleworkers compared to their on-site counterparts.
Employers are responsible for ensuring that teleworkers have a safe working environment. This includes providing information on health and safety practices and conducting risk assessments for remote work environments.
When it comes to equipment necessary for remote work, the law outlines the employer’s obligation, such as providing computer and software, and includes provisions for covering expenses related to telework, such as internet costs.
While employers can monitor telework performance, any monitoring must comply with data protection laws and respect employee privacy. Clear communication regarding performance expectations and evaluation criteria is also essential.
Romania introduced the Digital Nomad Visa to cater to international remote workers who wish to live and work within the country. To qualify for this visa, applicants need to prove that their average earnings are at least three times the gross average salary in Romania for each of the six months preceding the application.
The process for obtaining a Romanian Digital Nomad Visa involves an application fee of approximately €100 (490 RON or $110 USD). Once in Romania, applicants are required to apply for a residence permit, which comes with its own set of fees. The processing time for a Romanian visa currently averages between 10 to 14 working days, though it can vary based on individual circumstances.
With the introduction of the digital nomad visa, working remotely in Romania is within reach. Under Law No. 22/2022 or the Law on the Regime of Teleworking and the Work of Digital Nomads, it defines digital nomads as individuals who work remotely using digital technologies and can perform their jobs from anywhere, including from Romania, provided their employer or client is based outside the country.
The law establishes a specific temporary residence permit for digital nomads, allowing them to stay in Romania for up to 12 months, with the possibility of extension. Applicants must demonstrate that they have the means to support themselves during their stay, such as proof of sufficient financial resources and health insurance.
Digital nomads who work remotely from Romania but are employed by foreign companies will be subject to the Romanian tax system if they stay for more than 183 days within a year.
Like other countries, Romania has its own rules and regulations when it comes to employment contracts — and non-compliance could to legal disputes and hefty fines.
Thankfully, our team of experts specialises in drawing up tailored, compliant contracts in Romania (and more than 100 countries worldwide). That means that, when you work with us, you won’t have to spend time worrying about whether you’ve got it right. Instead, you can focus on what truly matters: growing your business.
Get in touch with us today and start building your global teams.
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