ROMANIA – Employers to Obtain Labour Market Approval Before Hiring Foreign Workers
A new ordinance has been adopted by the Romanian Government, which will enter into force on 28 November 2014. The ordinance establishes the need for a labour market approval in some cases and emphasises the need for compliance with the labour code and reporting responsibilities. It is important to note that details of the practical implementation of the changes are as yet unconfirmed, and further significant changes may be announced in the coming weeks. The ordinance states that a new employment approval for a foreign national employed locally in Romania must be issued by the General Inspectorate for Immigration.
New Employment Approval Dependent on State of Labour Market
The new employment approval will only be issued if the Romanian entity has first attempted to fill any vacancy with a Romanian national, EU/EFTA national or a Romanian permanent resident. So far, no clear conditions or guidelines for how this labour market search must be conducted have been issued.
The new labour market search does not replace the quota system already in place (see Peregrine alert on Romania’s 2014 quotas here).
Exemptions to the Labour Market Test
The labour market testing condition need not be met if:
- the vacancy is for a trading company director and the employer in question does not have another foreign employee occupying such a position;
- the intended employee is a highly qualified worker (however, there is no definition of “highly qualified”, to date);
- the employee is on home payroll and on secondment in Romania ( a similar approval for secondment will be required instead);
- the intended employee is from a State bordering Romania, and lives in a designated border area (an approval for cross-border workers will be issued instead);
- the position in question is for professional athletes, and the employer’s main field of activity is sporting activities.
Compliance with Regulations
Additionally, the following conditions must be met, in order for approval to be granted:
- The Romanian entity must not have been recently sanctioned or convicted for offences under the Labour Code
- The Romanian entity must not be behind in its tax contributions;
- The Romanian entity must not have been sanctioned, in the past three years, for hiring foreign workers without the correct work permit, or for engaging up to five workers without concluding individual employment contracts;
- The Romanian entity must not have been sanctioned for failing to submit correct employment notifications to the inspectorate for foreign workers (such notifications must be submitted no later than the last working day prior to commencement of the employee’s work).
Fees, Fines and Penalties
The new employment approval carries a fee in Romanian Ley (RON) equivalent to EUR200 (with a reduced fee equivalent to EUR50 applicable to some categories, including foreign nationals who have been employed in Romania on a Blue Card).
Any failure to meet the legal obligations regarding the employment or secondment of foreigners is punishable by fines of between RON700 and RON3000 (EUR150 to EUR650). Furthermore, depending on the gravity of offences committed, employers can also be punished by prohibition of certain rights, total or partial recovery of benefits, aids or subsidies, including EU funds, and/or the temporary or permanent closure of the unit or units where the offence was committed.
- Note that the new requirement for labour market testing will add some time to processing, although it is yet to be determined how this will work in practice.
- Note the greater emphasis on reporting responsibilities and compliance with labour laws.
- Be aware that there will be likely delays, in the processing of employment authorisations from 28 November 2014 when this ordinance takes effect.