Working life in North Macedonia

Source: Republic of North Macedonia State Statistical Office

Economic and labour market context

Overall, the political context for the development of industrial relations in North Macedonia has slightly improved since 2012, but it is not at the required level yet. The state’s political situation dictates the economic situation and the labour market. Economic and political difficulties have accelerated the emigration of young and professional personnel into EU countries. The reduction in unemployment is a result of the increase in foreign investment in industrial zones employing a large number of workers and of the emigration of young people into EU countries, which has also caused great turbulence in the labour market. According to a survey of 47 returnees from educational stays, 53.2% would like to move abroad again.

In 2012, the unemployment rate was 31.0%, while in 2017 it was 22.4%: a decrease of 8.6 percentage points. This trend continued in the next year: on 30 June 2018, the rate was 21.1%.

Since 2012, youth unemployment has been decreasing. However, according to the International Labour Organization, the 2014 level was still high, with over 50% of youth unemployed. In the second quarter of 2016, the youth unemployment rate fell below 50% (49.1%). In the third quarter, it decreased further to 46.4%.

After one year of recession (2012, with a drop in gross domestic product, or GDP of -0.5%), the North Macedonian economy began to grow, which resulted in real GDP growth of 2.9% in 2013, 3.5% in 2014, 3.7% in 2015 and 2% in the first quarter of 2016.

In April 2018 the European Commission adopted its annual Enlargement Package assessing the implementation of the European Union’s enlargement policy which is based on established criteria and fair and rigorous conditionality. The current enlargement agenda covers the partners of the Western Balkans and Turkey. Accession negotiations have been opened with candidate countries Montenegro (2012), Serbia (2014) and Turkey (2005). North Macedonia has been a candidate country since 2005 and Albania obtained candidate status in 2014. Bosnia and Herzegovina (application to join the EU submitted in February 2016) and Kosovo (Stabilisation and Association Agreement entered into force in April 2016) are potential candidates.

• European Commission: Enlargement package – press release
• European Commission: North Macedonia on its European path (PDF)
• European Commission: Key findings of the 2018 Report on North Macedonia

The social environment in North Macedonia has not been favourable for the development of industrial relations. The economic context was very bleak over the course of the transitional period, with low levels of economic growth, a very low level of both foreign direct investment and local investment, a high level of unemployment (constantly over 32%) and increasing poverty. Those most severely affected by the region’s political and economic transition expressed their dissatisfaction strongly throughout the 1990s through numerous strikes, street rallies and demonstrations. These protest actions, many of which were organised by trade unions, had little effect. Gradually the tensions subsided but, under the threat of company closures and massive layoffs, the employed workers renounced their solidarity and collective action, adopting a strategy of individual self-interest. This situation – in which workers feel threatened, disoriented and under permanent pressure – is still prevalent.

Legal context

Employment issues in North Macedonia are regulated by the constitution of North Macedonia and the labour law (2005). In the constitution of 1991, North Macedonia was proclaimed a social state with a high level of provision for social and economic rights. These basic values, promoted in the constitution, were then operationalised in many laws, most significantly in the labour law. Many laws were revised and new ones created to harmonise with EU standards. The labour law was extended significantly: since its adoption in 2005, it has been amended 17 times, with many new provisions concerning discrimination, harassment (sexual and gender harassment), collective bargaining, trade unions and strikes. Despite these additions, critics say that further laws are needed on trade unions, collective bargaining, strikes and mobbing to improve the situation of workers.

In 2013, amendments included the following:

• changes in the selection process for job candidates, including timeframe
• the duration of seasonal work (eight months during a calendar year) and working hours for seasonal work (not longer than 12 hours per day or 55 hours per week for a period of four months)
• protection from discrimination against female employees on the grounds of pregnancy, birth and motherhood
• Amendments in 2014 included a more detailed preview of the hiring procedure via public announcement and an increase in the working age (up to 67 for men and 65 for women) upon request of the employee.

The 2015 amendments changed and clarified:

• overtime work restrictions, with a maximum of 8 hours per week or 190 hours per year
• holiday allowance
• fines and conditions for not regulating the status of employees

The changes in 2016 were of a more technical character.

Industrial relations context

Traditionally, neo-liberal policies have been favoured in North Macedonia; these have had considerable influence on the structure of the economy and hence on industrial relations. The main actors emerged after some delay and relatively slowly. Until 2005, social dialogue was essentially dominated by one trade union: the Confederation of Trade Union Organisations of Macedonia (KSOM), the successor to the former socialist trade union. The sole employer organisation was the Chamber of Commerce (from the socialist period).

One of the main problems with the pluralisation of social dialogue (including the unions and employer organisations) was the question of representativeness. In 2009, after a delay of 19 years, the problem was solved through changes in the labour law: the qualifying level of membership was fixed at 10% for unions and 5% for employer organisations. However, during the transition period, trade unions were perceived by the public as unimportant actors, unable to promote and protect the interests of employees. Rather, they were seen as too close to the political elite; employer organisations were similarly perceived. In contrast, the state was seen to have considerable, and increasing, power. An asymmetry of power characterises relations between the main actors in the country’s social dialogue, with all the implications that such a distribution of power has for the industrial relations system.

Industrial relations between 2014 and 2017 featured limited bipartite social dialogue (collective bargaining) and slightly more tripartite social dialogue (which takes place within the framework of the Economic and Social Council). The process of decentralisation of the tripartite social dialogue at the level of local self-government continued over this period, with the number of Local Economic and Social Councils (LESCs) increasing from 9 to 15.

Also during this period, social conflicts in the form of strikes and protests were significantly fewer in number compared to the previous period. In 2012, employees in 13 companies with 5,242 participants were on strike for an average of five to six days. In 2017, employees in 7 enterprises were on strike with about 990 participants for an average of two days. In 2016, for the first time in North Macedonia, 59 conciliators and arbitrators were trained in the peaceful resolution of individual and collective labour disputes. No information is available on the number of individual and collective labour disputes that have since been resolved by licensed conciliators and arbitrators.

Trade unions, employers’ organisations and public institutions play a key role in the governance of the employment relationship, working conditions and industrial relations structures. They are interlocking parts in a multilevel system of governance that includes the European, national, sectoral, regional (provincial or local) and company levels. This section looks into the main actors and institutions and their role in North Macedonia.

Public authorities involved in regulating working life

The most important institution that has jurisdiction over the issue of social dialogue and working conditions in North Macedonia is the Ministry of Labour and Social Policy. The ministry facilitates social dialogue, maintains a register of trade unions and employers’ associations and keeps records of the general and branch collective agreements concluded in the country.

The Economic and Social Council is also included in social dialogue as a tripartite consultative body. First established on 30 December 1996 and reconstituted in September 2010, it is composed of 12 members:

• four from representative trade unions (two from the Federation of Trade Unions of Macedonia (SSM) and two from the Confederation of Free Trade Unions of Macedonia (KSS)
• four from the representative associations of employers (all four are from the Organisation of Employers of Macedonia – OEM)
• four from the government

The Commission for the Establishment of Representativeness, established in 2009, is comprised of nine members (three from representative trade unions, three from representative employers’ associations and three from the government) and has an important role in the development of social dialogue.

The main state institutions and mechanisms that protect and fulfil employees’ rights are:

• basic courts that have a department for labour disputes
• the Commission for Protection against Discrimination
• the Commission for Equal Opportunities
• labour inspectors
• conciliators and arbitrators for solving individual and collective labour disputes

Mediators working in accordance with the law on mediation play an important role in the resolution of individual labour disputes. Article 1 determines the field of application of mediation in the sphere of labour disputes as well.

The main institutions that monitor and improve health and safety at work are:

• the National Council for Safety and Health at Work
• the Occupational Safety and Health Inspection
• the Safety and Health Association
• the Employees’ Representative for Safety and Health in enterprises

The National Council for Occupational Safety and Health is an advisory and consultative body of the government and is composed of 15 members.

Trade unions

About trade union representation

The right to organise and associate in trade unions in North Macedonia is guaranteed by the constitution (Article 37, paragraph 1). According to the constitution, this right can be restricted by law in the armed forces, the police and administrative bodies (Article 37, paragraph 2). However, this right is not limited in any law. In the labour law, the right to trade union organisation is regulated in Chapter XVIII of Articles 184–202.

The most important trade union confederations in North Macedonia are:

• the Federation of Trade Unions of Macedonia
• the Confederation of Free Trade Unions of Macedonia
• the Union of Independent and Autonomous Trade Unions of Macedonia
• the Confederation of Trade Union Organisations of Macedonia

The Federation of Trade Unions of Macedonia (SSM) has 17 branch unions and is a member of the European Trade Union Confederation (ETUC). It has 37,792 members in the public sector, or 23.7% of the total number of employees in the sector, and 28,594 members in the private sector, or 9.1%. It has representative status at the national level in the private and in the public sector.

The Confederation of Free Trade Unions of Macedonia (KSS) has 10 branch unions with 43,391 members, or 30% of the total number of employees, in the public sector. KSS is a member of ETUC.

The Union of Independent and Autonomous Trade Unions of Macedonia (UNASM) has six branch trade unions. It is a member of ETUC, but it does not have representative status. There are no data about the number of members.

The Confederation of Trade Union Organisations of Macedonia (KSOM) has two branch trade unions and does not have representative status.

The most important branch trade unions in North Macedonia are:

• Trade Union of Education, Science and Culture (SONK) (27,000 members)
• Autonomous Trade Union of Health, Pharmacy and Social Care of the Republic of Macedonia (SSZF) (9,212 members)
• Macedonian Police Trade Union (МPS) (6,882 members)
• Trade Union of the Workers in Catering, Tourism, Communal and Housing Economy, Handicraft and Protecting Associations of Macedonia (SUTKOZ) (6,974 members)
• Union of Financial Organisations (SFO) (4,229 members)
• Trade Union of Civil Engineering, Industry and Design of Macedonia (SGIP) (3,547 members)
• Trade Union of Workers in Traffic and Communications of Macedonia (SRSVM) (2,780 members)

On 30 April 2013, the Solidarity Charter of Trade Unions and all Friends of Workers in Macedonia was signed by:

• the Trade Union of Administration, Judicial Bodies and Citizens’ Associations (UPOZ)
• the Independent Syndicate of Clinical Centres (SSKC)
• the Union of Macedonian Diplomatic Services (SMDS)
• the Independent Syndicate of Journalists and Media Workers (SSNM)
• LENKA (social justice movement)

In 2015, two branch trade unions joined the Charter:

• the Macedonian Culture Syndicate
• the Multi-ethnic Union of Education (MESO)

In December 2014, a number of employees from several cultural institutions in the country (for example, theatres, ballet companies and orchestras) left SONK and formed the Union of Trade Unions for Culture, which is registered in accordance with the law. Several trade union organisations left SONK in response to its unsuccessfully organised strike during January and February 2015. In September 2015, the SSM Council decided to exclude MESO, but it rejoined in 2017.

As of 31 December 2017, according to the Ministry of Labour and Social Policy, 58 trade unions are registered in North Macedonia.

Main trade union confederations and federations

Trade union membership, by branch

Employer organisations

About employers’ representation

According to the data in the employers’ registry maintained by the Ministry of Labour and Social Policy until 31 December 2017, 10 employer associations were registered at the national level. The biggest employer organisation (as of December 2018) is the Organisation of Employers of Macedonia (OEM).

According to data from North Macedonia’s Official Gazette, the OEM has a membership of 1,012 individual firms, with 51,346 employees. This amounts to 18.1% of the employees in the private sector of North Macedonia. Before OEM was established, the Economic Chamber of Macedonia played a dominant role in industrial relations representing employers. The Business Confederation Macedonia (BCM) also has significant membership.

Other employers’ associations enrolled in the register of employers, but without representative status, include the following:

• Employers’ Association of Transport and Communications of Macedonia
• the National Federation of Temporary Employment Agencies
• the National Association of Operators for Public Communication Networks (Naojkm)
• the Employers’ Association of Water Management (ZRV)
• the Union of Employers’ Organisations of Macedonia
• the Macedonian E-Commerce Association

Main employer organisations and confederations

The OEM was established in 2004 in accordance with the law on citizen associations and foundations. In the same year, the OEM separated from the Economic Chamber of Macedonia (ECM) and started to act as a separate entity.

In June 2006, the OEM signed the general collective agreement for the North Macedonian economy on behalf of employers, with the SSM signing on behalf of workers.

By August 2010, 12 branch (industry) employers’ associations were formed within the OEM, including the employers’ associations for the following:

• textile industry
• leather and shoe industry
• Construction industry
• tobacco industry
• agriculture
• food and drink industry
• paper, publishing, printing industry
• chemical, plastics, artificial yarns industry
• public utility services
• hotel and catering industry
• association of Employers of the company with disability employees
• association of Regulatory bodies

Employers’ associations within the OEM have signed eight branch collective agreements, four of which determined the minimum wage for textiles, the leather and shoe industry, agriculture and the food industry. The OEM became representative with Resolution No. 08-2226/5 signed on 14 July 2010.

The BCM was registered in 2001 as a citizens’ association under the name of the Confederation of Employers of Macedonia (KRM). In 2006, it was registered in the employers’ registry at the Ministry of Labour and Social Policy. By August 2010, KRM had a total of 8,500 members, employing over 40,000 workers. In 2006, the Chamber of Craftsmen, which represents more than 1,500 companies, became a member of KRM. This confederation signed five branch collective agreements covering about 22,000 workers, which translates to about 55% coverage. KRM had four regional offices. On 21 December 2009, it was reregistered under the name ‘the Business Confederation Macedonia’ (BCM) or Business Macedonia. This organisation did not obtain representative status, and it has raised a complaint with the commission responsible for assessing representativeness.

Unlike trade unions, employers’ associations – with minor exceptions – tend not to fragment. The representative status at national level is possessed by the OEM alone. In the private sector, there is little interest in establishing new boards of employers and obtaining representative status according to the national classification of activities (NCA), which hinders the process of collective bargaining in certain industries (metal industry, construction, metallurgy, mining, trade and forest industry). Instead of taking place at branch level, bargaining is carried out at employer level.

Tripartite and bipartite bodies and concertation

The most important North Macedonian tripartite bodies at the national level are the Economic and Social Council, the Commission for Determining Representativeness and the National Council for Safety and Health at Work.

The Economic and Social Council (ESC) has an advisory-consultative role and is responsible for issues related to:

• employment
• wage policy
• economic development
• healthcare
• collective bargaining
• safety and health at work
• peaceful resolution of labour disputes
• macroeconomic policy
• tax policy
• education
• vocational training

The Commission for Determining Representativeness is a tripartite body that has the authority to conduct a procedure for determining the representativeness of trade unions and employers’ associations.

The National Council for Safety and Health at Work is an advisory and consultative body of the government, responsible for occupational health and safety.

At the local level, 15 LESCs have been established as a form of decentralisation of the social dialogue from national to local level.

Main tripartite and bipartite bodies

The central concern of employment relations is the collective governance of work and employment. This section looks into collective bargaining in North Macedonia.

Bargaining system

In North Macedonia, a collective agreement is a legal instrument that regulates the rights and obligations of employment, while the bargaining persons negotiate in good faith for the conclusion of a collective agreement. There are three levels of collective bargaining in North Macedonia: national, branch level and company level (Article 203 of the labour law).

In accordance with Article 205 of the labour law, a general collective agreement for the private sector and a general collective agreement for the public sector are directly applied and are mandatory for all employers and employees in the private or public sector. Hence, the rate of coverage of employees in North Macedonia is 100%.

A collective agreement at branch or department level is directly applied, and it is mandatory only for the employers that are members of the employers’ association that signed the collective agreement or those that join the association subsequently. At this level, the rate of coverage of employees with a collective agreement was 70% in 1998, falling to just 35% in 2010, although in 2011 the percentage rose again to over 40%.

A collective agreement at employer level (company level) also covers employers and workers who are not members of the collective agreement signatory union. Figures from the Ministry of Labour and Social Policy indicate that the rate of coverage of employees with a collective agreement at employer level in 2017 was 24.6%. In 2016 and 2017, 17 branch collective agreements were concluded.

There is no legal framework for the extension of collective agreements in North Macedonian labour legislation. Tripartite and bipartite social dialogue is the basic institutional mechanism for coordinating wage bargaining. At the national level, wage negotiations are coordinated by the Economic and Social Council. At branch and department level, the main mechanisms for coordinating wage bargaining are the negotiating teams and working groups of the negotiating parties (boards, committees and councils), while for the monitoring, application and interpretation of the collective agreement, the parties are required to form a commission on a parity basis.

On 14 September 2010, the Ministry for Interior Affairs established the Economic and Social Council. This body has broad responsibilities for economic and social issues, as well as for issues related to wages within and outside the ministry. The council consists of six members: the State Secretary of the Interior, the General Union Secretary of the Interior and two representatives from both the ministry and the union. The main characteristic of collective bargaining in North Macedonia is its decentralisation. There is strong emphasis on collective agreement at the branch and employer level, especially in terms of wages, including the minimum wage. However, the national level remains strong, especially in the public sector. In 2017, the Independent Trade Union of the Police of Macedonia and the Trade Union of the Employees of Macedonian Railways organised strikes; demands included greater participation and signing a collective agreement.

Bargaining levels

The most important level of collective bargaining around wages and working hours is the national level – that is, the general collective agreement. Next in importance are branch collective agreements, followed by employer-level collective agreements. This order is due to the power of the unions at national level and the possibility of imposing these issues through the Economic and Social Council at state level.

Levels of collective bargaining, 2017

Timing of the bargaining rounds

The labour law does not specify a set time for negotiation. A collective agreement may be concluded after a period of two years, with the possibility of extension based on the written consent of the parties. When the validity of the collective agreement continues with the agreement of the parties, an agreement shall be concluded no later than 30 days before the expiration of the validity of the collective agreement.

Coordination

The coordination of collective bargaining at national level is carried out by the Ministry of Labour and Social Policy and the Economic and Social Council. The coordination of collective bargaining at the branch or department level is carried out by the trade union and employer boards of individual branches, while the coordination of collective bargaining is carried out by the bodies of the trade unions and the employers’ associations.

Extension mechanism

There are no provisions in the law on expanding the collective agreements.

Expiry of collective agreements

Collective agreements are concluded after a period of two years.

Peace clauses

In general collective agreements and all branch collective agreements, there are provisions for the peaceful resolution of both individual and collective labour disputes.

Other aspects of working life addressed in collective agreements

The labour law regulates a number of issues regarding discrimination, including the prohibition of discrimination, direct and indirect discrimination, exceptions to the prohibition of discrimination, harassment and sexual harassment, psychological harassment at work (mobbing), compensation for discrimination and burden of proof.

The general collective agreement for the private sector in the economy, the general collective agreement for the public sector and the branch collective agreements explicitly regulate the issue of protection in cases of discrimination. For example, the agreements for the leather and shoe industry, textile industry, tobacco industry, agriculture and food industry, primary and secondary education and forestry industry stipulate the amount of compensation an employee who is subject to such discrimination is entitled to.

In April 2010, on the initiative of the SSM, a special law was adopted on prevention of and protection against discrimination; according to the provisions of the law, a non-discrimination committee was formed in 2011. At all levels, collective agreements contain provisions concerning the procedure and criteria for declaring employees redundant; here, unions play a very important role. Accordingly, when an employer introduces economic, technological and structural changes, there is an obligation to notify the union for consultation, particularly regarding the prevention and mitigation of harmful situations and consequences. When declaring employees redundant, the starting point is the criteria for such actions set out in the relevant collective agreement. Almost all collective agreements confirm that, all other things being equal, preference should be given to certain employees, for example those who have five years until retirement, single parents, parents with a handicapped child and workers with occupational diseases.

The general collective agreements include provisions concerning vocational training and education of workers, leaving specific details to be settled at branch and employer level. According to these agreements, the employee has the right and duty to undergo continuous education and further education and training, in accordance with the needs of the working process, in order to maintain or enhance their ability to work in the workplace, as well as to keep the workplace safe. The issue of gender equality in the collective agreements is not clearly specified at any level of collective bargaining. From a legal perspective, the question of non-discrimination and, in that context, gender equality, is regulated by the labour law: Directive 75/117/EEC concerning the principle of equal salaries for women and men. 

Legal aspects

There is no definition of a strike in the labour law. In Article 236 it is regulated that ‘the trade union and its associations on a higher level have the right to call a strike and to bring it in order to protect the economic and social rights of its members from employment, in accordance with the law’. The strike may not start before the conciliation procedure is completed in accordance with the labour law.

In North Macedonia, there are three legal types of industrial actions: a strike (strike of solidarity), a removal of workers from work and a social protest. Strikes are explained above. For the removal of workers from work, the following conditions apply.

• The employer may remove workers from the work process only in response to a strike that has already started.
• The number of workers removed from work must not exceed 2% of the number of workers participating in the strike.
• The employer can remove from the working process only those workers who, with their behaviour, encourage violent and undemocratic behaviour, thus preventing negotiations between the workers and the employer.
• The right to protest (social protest) is guaranteed by the constitution of North Macedonia, without prior registration and permission, and can be restricted only in a military state of emergency (Article 21).

Between 1990 and 2005, there were many strikes in North Macedonia for various reasons. Generally, the main motivation was the poor material and social position of employees, or violation of employee rights. During this period, strikes lasted on average 10–15 days.

Between 2006 and 2010, the frequency of strikes reduced dramatically and they lasted two or three days on average. In 2009, 12 strikes were recorded at the national level, of which 11 were at the employer level; the other was a general warning strike of public administration organised by the public administration trade union.

In 2010, there were 10 strikes, as well as 22 trade union protests, according to the SSM. In 2013, there were 13 strikes, while in 2017 there were 7. The organisers of the strikes and protests were trade union organisations within the enterprises concerned. The strikes were mainly organised in the private sector (textile, metal, food and construction industries), but they also occurred in the public sector (public administration, education, healthcare and utility services).

The main reasons for the strikes between 2014 and 2017 were such issues as failure to sign the collective agreement, low wages, non-payment of fees for food, non-payment of contributions for health insurance and pension insurance and declaration of redundancies. Although a legal opportunity was established under the labour law for the general collective agreements and the branch collective agreements to resolve collective labour disputes (strikes) through the Peace Council and arbitration, there is no evidence that these legal mechanisms have been applied in practice. There is an intention to establish a separate body at the national level for arbitration and mediation in labour disputes, but such a body is not yet operating.

Dispute resolution mechanisms

Collective dispute resolution mechanisms

The most important institutions responsible for the peaceful resolution of labour disputes are the Ministry of Labour and Social Policy, the Economic and Social Council and the Commission for Determining Representativeness. The first two institutions encourage a peaceful resolution of collective labour disputes. The Economic and Social Council is competent in the selection of conciliators and arbitrators, and the Ministry of Labour and Social Policy has the authority to perform the following tasks: keep the registry of conciliators and arbitrators; train and develop conciliators and arbitrators professionally; exempt conciliators and arbitrators; conduct procedures for the peaceful settlement of labour disputes; and keep records of procedures.

In 2017, the Ministry of Labour and Social Policy registered 59 conciliators and arbitrators. Peaceful resolution of labour disputes (collective and individual) is legally regulated by the law on labour relations, the law on peaceful resolution of labour disputes and collective agreements.

A collective labour dispute, according to law, is considered a dispute on the occasion of concluding, amending, supplementing or applying a collective agreement, exercising the trade union’s rights to organise and strike. The parties to the collective dispute may submit a proposal to the ministry for the participation of a conciliator to help to resolve the dispute. In the event of a strike or a dispute in activities of general interest, it shall be preceded by a conciliation board composed of an equal number of representatives from the parties to the dispute.

In the conciliation procedure, the conciliator is obliged to schedule a hearing within three days of receipt of the proposal and conclude the hearing within 20 days from the day of commencement of the hearing, making a recommendation for resolving the dispute. If the parties to the dispute accept the recommendation, they conclude an agreement to resolve the dispute. If the subject of the dispute is the collective agreement, the new agreement becomes an integral part of the collective; if the dispute is not a collective, the agreement has the force of judicial settlement (Article 25, paragraphs 3 and 4).

Individual dispute resolution mechanisms

The subject of an individual labour dispute is the cancellation of the employment contract or an unpaid salary. This type of dispute is settled before an arbitrator. If a court proceeding arises between the parties in the individual labour dispute, these parties are obliged to submit jointly to the court a request for termination of the procedure. The arbitrator is obliged to schedule a hearing within three days from the day of the receipt of the proposal. The arbitrator runs the hearing, takes statements from the parties to the dispute, gives evidence and takes care of the course of the proceedings. Based on statements, facts, arguments of the parties to the dispute and other summoned persons, the arbitrator shall reach a decision on the subject of the dispute within 30 days from the day of the opening of the hearing. No appeal is allowed against the arbitrator’s decision. The parties to the dispute are obliged to notify the court about the decision of the arbitrator if the procedure before the court is terminated.

Use of alternative dispute resolution mechanisms

Alternative methods of resolving labour disputes are very rarely used. The parties in labour disputes prefer to resolve disputes in court. Parties in disputes try to resolve individual and collective labour disputes through reconciliation and arbitration but, for now, there are no major successes. The basic problem is that citizens are not sufficiently informed about this way of resolving disputes. There are no concrete data on the number of cases of labour disputes resolved by conciliators and arbitrators.

Individual employment relations are the relationship between the individual worker and their employer. This relationship is shaped by legal regulation and by the outcomes of social partner negotiations over the terms and conditions governing the employment relationship. This section looks into the start and termination of the employment relationship and entitlements and obligations in North Macedonia.

Start and termination of the employment relationship

Requirements regarding an employment contract

The law on labour relations specifies general and special conditions for employment. General conditions for employment are that the candidate must be at least 15 years of age and generally be in good health. Special conditions for employment include professional training, working abilities, work experience, vocational qualifications, knowledge of a foreign language and special medical abilities. Job vacancies must be published in the mass media for three working days. Any interested party can apply by submitting all the requested documents.

When selecting candidates, the employer should be guided by the principle of non-discrimination. Having advertised publicly, the employer may conduct interviews to select candidates. In accordance with the provisions of the labour law, the employer has the freedom to decide with which candidate to settle an employment agreement.

Next, the employer is obliged to register the new employee for mandatory social insurance with the state Employment Service Agency (ESA) within three days of signing the employment agreement; the employee cannot start work before the employer registers them in this way.

For urgent and pressing matters, a working relationship can be established without advertising the vacancy publicly, but only for up to 30 days and with the mediation of the ESA.

Dismissal and termination procedures

The employment agreement can be cancelled by either the employer or the employee, with a notice period or without one. A cancellation by the employer may be due to the following reasons:

• personal reasons (e.g. due to the employee’s behaviour or lack of knowledge)
• the employee’s violation of their contractual obligations
• business reasons (economic, organisational, technological or structural changes)

The employee has the right to appeal against their dismissal to the management body within eight days of receiving the decision. The appeal is then decided within eight days from the employee’s objection being filed. An employee who is not satisfied with the decision made upon the appeal has the right to initiate a dispute before the competent court in the next 15 days. At the request of the employee, a trade union can represent the employee during the appeal process (Article 93 of the labour law).

Entitlements and obligations

Statutory leave arrangements

Sick leave

A worker is entitled to sick leave. The right to salary compensation due to employee illness is regulated by the law on labour relations and the law on health insurance.

The employee is entitled to salary compensation for the whole absence in the cases and for the duration determined by law. The employer pays salary compensation for up to 30 days if the worker is incapacitated due to their illness or injuries; beyond 30 days, it is paid through health insurance.

In accordance with the provisions of the general collective agreement in the private sector, during a period of incapacity for work (sick leave) of up to seven days, an employee is entitled to salary compensation up to 70% of the base salary. The base salary represents the average monthly net salary per worker in North Macedonia paid in the previous three months (Article 35-b of the general collective agreement for economy in the private sector). For up to 15 days, this increases to 80% and beyond 15 days, 90% is paid, as determined by law. When an employee takes uninterrupted sick leave for more than six months due to work injury or occupational disease, according to the collective agreement at activity level or employer level, compensation is paid at the full base salary.

If the worker can no longer work due to the severity of the injury or illness, they can get a disability pension, which is 80% of the base pension.

The employee must not be dismissed during pregnancy and maternity leave.

Retirement age

According to the law on labour relations, a worker retires at the age of 64 (men) or 62 (women), having completed at least 15 years of service. However, the law allows for employment to continue up to 67 years for men and 65 years for women, if the employee submits a request by 31 August the year before the extension of the employment would apply.

For workers, the reward for work and main source of income; for employers, a cost of production and focus of bargaining and legislation. This section looks into minimum wage setting in North Macedonia and guides the reader to further material on collective wage bargaining.

The average net monthly salary paid per employee in the period 2014–2017 in North Macedonia was MKD 22,142 (€357.28 as at 8 May 2019).

Through this period, the index of the nominal net salary increased continuously. In 2012, the index of the nominal net salary was 143.3; by 2017 it was 157.2.

The index of the cost of living in 2012 was 117.2, while in 2017 it was 121.1.

The real net salary index in 2012 was 122.3; by 2017 it was 129.8 (a 7.5-index point increase).

• Publication: Statistical yearbook of the Republic of Macedonia 2018

Minimum wages

The law on the minimum wage was introduced in 2012 after long negotiations between social partners. The SSM and the KSS were at the forefront of the move to adopt this law. In October 2011, the social partners announced that the monthly minimum wage would be MKD 8,050 (€129.89 as at 8 May 2019), which was 39.6% of the average gross wage.

In most branch collective agreements, the basic salary represents the lowest salary for the lowest degree of work complexity. Salaries are then determined by multiplying the ratio of the level of complexity for the type of work. With respect to gender equality, the tendency is for wages of men and women to be equal for equally demanding work.

According to Article 2 of the law on the minimum wage, the minimum wage is the lowest monthly amount of the basic salary that the employer is obliged to pay to the employee for work performed for full-time work. The gross minimum wage is announced by the Minister of Labour and Social Policy based on information from the Economic and Social Council. Changes are aligned with three factors:

• the national average salary increase (one-third)
• the living costs index increase (one-third)
• the real GDP growth (one-third)

These factors are considered for the previous year, according to data from the State Statistical Office.

Amendments to the law on the minimum wage in 2016 departed from the rule that the minimum wage in the low accumulative industrial branches (the textile, leather and shoe industries) should be lower. The minimum wage in these branches is now levelled with the other industrial branches.

The gross minimum wage to be paid for July 2018 to March 2019 inclusive is MKD 17,370 (€280.28 as at 8 May 2019).

Adult rates for minimum wage, 2013–2018

Note: MKD = Macedonian denar

Working time: ‘Any period during which the worker is working, at the employer’s disposal and carrying out his activities or duties, in accordance with national laws and/or practice’ (Directive 2003/88/EC). This section briefly summarises regulation and issues regarding working time, overtime, part-time work as well as working time flexibility in North Macedonia.

Working time regulation

Working hours in North Macedonia are regulated by the law on labour relations, collective agreements and individual employment contracts.

A standard working week is five working days or 40 hours, although in labour laws and collective agreements it can be defined as shorter than 40 hours but at least 36 hours per week. By company-level collective agreement, full-time employment can be less than 36 hours per week for certain types of hazardous jobs (involving radiation, high temperature, altitude and working underground). In practice, the rules on working hours are sometimes ignored. There are instances in the textile industry, for example, where the maximum weekly working time is exceeded by more than 8 hours, with some employees working 10–12 hours per day.

The labour law stipulates 20 working days’ annual leave for full-time work. According to general collective agreements, the leave can be extended to 26 working days and should be determined on the basis of certain criteria, such as experience, age, complexity of the job, working conditions and health.

Overtime regulation

Full-time working is 8 hours per day or 40 hours per week. Working hours beyond full time are called overtime. This type of work is regulated by the law on labour relations and cannot last more than 8 hours a week, up to 190 hours a year.

For employees of the Ministry of Interior, who perform special duties and authorisation in accordance with a special law, overtime work may last longer than 190 hours per year for the execution of urgent and pressing matters, upon previously given written consent of the employee (Article 117, paragraph 3). When an employee works more than 150 hours overtime at the same employer and is not absent from work for more than 21 days during the year (not counting annual leave), the employer is obliged to pay not only a salary supplement but also a bonus, amounting to one national average salary (Article 117, paragraph 4).

For overtime work, the employer is obliged to pay the worker appropriate overtime allowance in accordance with the law and collective agreements. This allowance is not determined by law, but is regulated by collective agreement, which stipulates that a full-time worker has the right to overtime allowance of 35%. In some specific activities and professions, a higher overtime allowance (for example 38%, 40% or more) can be established in accordance with the principle in favorem laboratoris (interpreting legal rules in favour of the employee).

An employer with over 25 employees with work carried out at one or more locations is obliged to keep an electronic record of full-time and overtime work at each location (Article 116, paragraph 7).

Part-time work

Part-time work is regulated by the law on labour relations and collective agreements. A worker who works in particularly difficult or strenuous circumstances or in conditions that are harmful to their health (that is, working ability) that cannot be eliminated with protective measures, has reduced working hours in proportion to the harmful effect on their health. In exercising the right to salary and other employment rights, part-time working hours are equated with full-time working hours (law on labour relations, Article 122-a). A part-time work permit is issued by the minister responsible for labour matters at the request of the trade union, in consultation with the health institution carrying out occupational medicine and the Labour Inspectorate.

The following jobs are considered particularly difficult, strenuous and harmful to health:

• especially hard physical work
• working under increased atmospheric pressure
• working in noisy environments increased noise
• working in water or exposed to moisture
• exposed to ionising radiation
• working with infectious diseases and infectious materials
• surgical interventions in operating rooms
• the field of psychiatry
• working with people with the most severe impediments to psychological development
• forensic medicine and pathological anatomy
• working with corrosive materials
• working as flying personnel
• performing in ballet performers
• playing musical wind instruments
• folk dancing and solo opera performance
• working in the vicinity of high voltages
• working at great height or depth

Employer-level collective agreements determine extremely difficult working conditions according to which working hours shorter than 40 hours (but not shorter than 36 hours) per week will be considered full time.

For workplaces where there is a greater risk of injury or health damage, full-time work can be less than 36 hours per week, as regulated through collective agreement at employer level.

Extent of part-time work

In 2013, 21,244 persons were employed part time. In 2014, this figure reduced to 18,338 persons. There are no data for 2015, 2016 or 2017.

Night work

Night work is defined as ‘work that is performed during night time between 22:00 and 6:00 the next day’ (labour law, Article 127). The employer who uses workers for night work on a regular basis is obliged to inform the Labour Inspectorate.

The employer is obliged, at their expense, to provide night workers with:

• a longer rest
• appropriate food
• expert management of the work (that is, of the production process)
• medical examinations before engaging them in night work and at regular intervals determined by law

Shift work

Shift work means any method of organising work in shifts where workers are replaced by each other at the same workplace in accordance with a particular plan and which can be continuous or interrupted, including the need for workers to work at different times in a given period of days or weeks (Article 5, paragraph 1, line 10). A shift worker is any worker whose schedule of work is part of shift work. The employer can arrange work in shifts.

The plan of shift work must be submitted to the trade union organisation at least 10 working days before the implementation of the plan. Employees working in shifts have the right to a shift allowance in accordance with the law and collective agreement. The size of this allowance is determined by a branch-level collective agreement.

Weekend work

Work performed on Saturday or Sunday is defined as work during the weekly rest or weekend work. This kind of work is paid higher compared to work on other days. The collective agreement regulates the amount of compensation for weekend work and it is increased by 50% (General collective agreement, Article 24).

Rest and breaks

Rests represent an interruption in the working (physical and intellectual) activities and functions of employees during working hours. According to the labour legislation of North Macedonia, an employee is entitled to daily, weekly and annual rest.

The daily rest (or break) of an employee who works for six hours and longer is 30 minutes. A worker who works between four and six hours has the right to a 15-minute break. The break must take place after the first two hours and before the last three hours of work. The break is paid time.

The employee is entitled to a daily rest period of at least 12 uninterrupted hours between two consecutive working days (Article 133). The employee is also entitled to a weekly rest period of at least 24 hours uninterrupted, in addition to the 12 hours of daily rest between two consecutive working days.

Working time flexibility

On 1 September 2017, the government introduced flexible working hours in public and state administration. Work may begin between 7:30 and 8:30 and finish between 15:30 and 16:30, with a total working day of 8 hours.

Following this decision, employees in public institutions and administrative bodies will work in two shifts, with working hours of 7:00–14:30 and 14:00–21:30. Also, certain institutions will operate on the first Saturday of the month, with a single shift of 8:00–16:00. Flexible working time has been introduced in the following institutions:

• Public Revenue Office
• Customs Administration
• Office for Management of Registers of Births, Marriages and Deaths
• Ministry of the Interior
• Regional Offices in the Department for Administrative and Supervisory Matters
• Civil Affairs Department
• Ministry of Defence (departments of defence of regions with cities and municipalities)

The government has announced that this list will be expanded.

Maintaining health and well-being should be a high priority for workers and employers alike. Health is an asset closely associated with a person’s quality of life and longevity, as well as their ability to work. A healthy economy depends on a healthy workforce: organisations can experience loss of productivity through the ill-health of their workers. This section looks into health and safety and psychosocial risks in North Macedonia.

Health and safety at work

In North Macedonia, there have been only two forms of workplace representation thus far: union representatives (elected representatives) and representatives for health and safety at work. The number of safety and health representatives in a company depends on the number of employees.

The responsibilities of these representatives are regulated by law. Representatives of a trade union provide legal assistance to its members and represent the employees in front of managers, governing bodies, labour inspection and courts (see SSM, 2006, 2010). Between 1994 and 2009, SSM received 176,770 requests for advocacy and legal assistance. Most of these cases related to wages (50,230) and dismissals (17,500). The majority of the workers concerned were employed in industry, energy and mining (38,630), and the textiles, leather and shoe industries (34,550). According to the labour law and relevant collective agreements, trade union representatives have special immunity during their mandate and for two years afterwards.

Health and safety representatives within companies are chosen by the employees from among their ranks, at the representative trade union gathering or at an assembly of employees. The numbers of representatives are as follows:

• one representative should be elected for companies with 10–100 employees
• two representatives should be elected for companies with 101–500 employees
• three representatives should be elected for companies with 501 employees or more

The Council for Occupational Safety and Health (15 members) operates nationwide; it was formed by the government on a tripartite basis to serve as an expert advisory body.

The major institutional mechanisms that help workers to realise their rights are the trade unions, the Labour Inspectorate and the regular courts. There is as yet no special court for labour disputes, but regular courts have units dealing with labour disputes. The Labour Inspectorate acts throughout the country via an established network of inspectors, of which 61 focused on labour relations and 32 on safety and health in 2011. Between 2003 and 2009, the Labour Inspectorate received 3,092 requests for assistance from employees via their trade unions. These related mainly to overtime work and work during national holidays in the textiles sector.

Accidents at work

In North Macedonia, there are 118 inspectors in total, with 81 for labour relations and 37 for safety and health at work. In 2017, the Labour Inspectorate in the field of labour relations conducted a total of 20,355 inspection surveys; in response, 13,255 regular supervisions, 3,834 control supervisions and 3,206 inspection supervisions took place. The State Labour Inspectorate in the field of safety and health at work conducted 12,980 inspection surveys: 7,141 regular surveys, 3,577 control surveys and 2,262 special surveys.

The 2017 State Labour Inspectorate report does not provide data on injuries and deaths at work and the reports for 2013–2016 are not available. For these reasons, data are taken from the Macedonian Occupational Safety and Health Association reports.

Between 2013 and 2017, there were 643 accidents at work, of which 491 were injuries at work and 152 were deaths. By activity, most accidents at work happened in the defence sector, with 262 cases (245 injuries and 17 deaths). The next highest figures were recorded in households (family businesses) with 118 accidents (62 injuries and 56 deaths), followed by the construction sector with a total of 88 accidents at the workplace (58 injuries and 30 deaths). The figures indicate that the occupational safety and health system needs to be improved, above all in terms of increased control of the employers’ compliance with security measures at the workplace. Education of employees in terms of raising awareness about the importance of workplace safety should also be improved. 

Skills are the passport to employment; the better skilled an individual, the more employable they are. Good skills also tend to secure better-quality jobs and better earnings. This section briefly summarises North Macedonia’s system for ensuring skills and employability and looks into the extent of training.

National system for ensuring skills and employability

The national institutions responsible for identifying, developing and improving skills at work are:

• the Ministry of Labour and Social Policy
• the Employment Service Agency
• the Economic Chamber
• the Organisation of Employers of Macedonia
• universities
• vocational schools
• other public institutions in which the training of students is carried out

Their focus is on how to address the shortage of skilled labour most quickly and effectively through measures specially designed according to the demands and expectations of employers. The national system for ensuring skills and employability is based on the operational plan for active programmes and measures for employment and services on the labour market adopted by the government. The entities that are interested in a particular type of training for acquiring appropriate skills and professional qualifications are invited to take part in the training through a public call.

Training

The following public institutions are responsible for the regulation and development of training:

• the Ministry of Labour and Social Policy
• the Ministry of Education
• the Employment Service Agency
• universities
• secondary vocational schools
• local self-government

Work organisation underpins economic and business development and has important consequences for productivity, innovation and working conditions. Eurofound research finds that some types of work organisation are associated with a better quality of work and employment. Therefore, developing or introducing different forms of work organisation are of particular interest because of the expected effects on productivity, efficiency and competitiveness of companies, as well as on workers’ working conditions. Ongoing research by Eurofound, the European Working Conditions Survey and the European Company Survey, monitors developments in work organisation.

What is the legal basis for ensuring equality and non-discrimination at work?

The principle of equal treatment requires that all people, and in the context of the workplace all workers, have the right to receive the same treatment, and will not be discriminated against on the basis of criteria such as age, disability, nationality, sex, race and religion.

In the last few years, the state has created an anti-discriminatory legal framework that can be taken as a relatively good basis for future judicial practice. These acts are:

• the constitution
• the law on labour relations
• the law on prevention and protection against discrimination
• the law on protection from harassment at the workplace
• the law on equal opportunities between men and women

Article 9 of the constitution of North Macedonia contains a general equality clause that stipulates that citizens are equal in freedoms and rights, regardless of their gender, race, colour or national or social origin.

The law on labour relations is the key legislation in this area. In Article 6, it explicitly prohibits discrimination (direct and indirect) and harassment of a candidate for employment and of an employee. The weakness of the law is that Article 24, paragraph 1 does not explicitly prohibit discriminatory advertisements or statements based solely on the basis of gender, stating that the employer must not advertise a vacancy to men or women only, unless the specified gender is a necessary condition for performing that role.

National bodies responsible for ensuring equality between citizens (that is, those entrusted with the role of protection against discrimination) are:

• the Commission for Protection against Discrimination
• the ombudsman
• the Commission for Equality between Men and Women
• the legal agent for determining unequal treatment of women and men

The judicial authorities for protection against discrimination are:

• the Constitutional Court
• the Administrative Court (administrative procedure)
• the basic courts (civil legal protection)

Equal pay and gender pay gap

The law on labour relations is the main legislation that provides equal pay for equal work. It stipulates that ‘the employer is obliged for equal work with equal requirements at the workplace to pay equal pay to the workers regardless of their gender’ (Article 108) and that, if the provisions of the employment agreement, the collective agreement or the employer’s general actions are discriminatory, such provisions are null and void.

According to the World Economic Forum’s global gender gap report for 2012, North Macedonia is ranked 61st among 135 countries, with a gender gap of 0.6968. In 2013, equality slightly improved, and the gender gap was 0.7013, but in 2014, the gender gap dipped to 0.6943, ranking North Macedonia 70th out of 142 countries.

Official data on the gender pay gap in North Macedonia do not exist, but some data do indirectly point to it. According to the Ministry of Labour and Social Policy and the State Statistical Office, the gender gap in the rate of employment in 2011 was 16.1%; in 2013 it was 19%. The employment rate in 2014 was 35.4% for women and 47% for men. Analyses made in 68 municipalities indicate that the number of employed men in public enterprises and in municipal administration is almost twice the number of women, while in managerial positions, the number of men is almost three times the number of women.

According to the State Statistical Office, women make up 27.8% of members of legislative and executive bodies, state officials, senior civil servants, diplomats and executives.

The latest survey of wages in North Macedonia shows that the 2017gender pay gap was 12.5%. In North Macedonia, women on average earn 12.5% less than men. When taking into account characteristics such as education, years of service, age and occupation profile, this gap increases to 17.3%. Considering primary education, this gap reaches 28%.

Quota regulations

In order to reduce the gender gap between women and men in the 2006 election code, a 30% quota is planned for women’s representation in parliament and the municipal councils.

Employers

BCM – Business Confederation Macedonia

OEM – Organisation of Employers of Macedonia

Trade Unions

KSS – Macedonian Confederation of Free Trade Unions

SSM – Federation of Trade Unions of Macedonia

Government

Economic and Social Council (in Macedonian)

Ministry of Labour and Social Policy (in Macedonian)

State Labour Inspectorate (in Macedonian)

State Statistical Office

Other links

Macedonian Occupational Safety and Health Association

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