Working life in Croatia

Notes: Values for real GDP per capita are chain-linked volumes (based on 2010 data; €). The unemployment rate for men and women is the annual average as a percentage of the active population aged 15–74 years, and the youth unemployment rate is the annual average as a percentage of people aged 15–24 years. The employment rate for men and women is the annual average as a percentage of the active population aged 15–64 years, and the youth employment rate is the annual average as a percentage of people aged 15–24 years. GDP, gross domestic product.

Source: Eurostat [sdg_08_10], for real GDP per capita and percentage change 2012–2022; [une_rt_a], for unemployment rate by sex and age; [lfsi_emp_a], for employment rate by sex and age.

Economic and labour market context

Between 2012 and 2022, gross domestic product (GDP) grew by 39.9% in Croatia, and this growth was significantly greater than the EU average growth rate of 15.3% for the same period. Total unemployment between 2012 and 2022 decreased significantly and stood at 7% in 2022, remaining close to the EU average of 6.2% for that year. Youth unemployment decreased by 24.1 percentage points from 2012 to 2022, while youth employment increased by 4.9 percentage points during this period. Female employment rates also improved and reached 65.6% in 2022. In 2020, due to the pandemic, unemployment rates increased, most significantly for young people (by 4.5 percentage points), reaching 21.1% in that year.

Legal context

On 15 July 2014, the Croatian parliament adopted the new Labour Act (Zakon o radu; OG 93/14). The act aims to increase the number of employed people and to create a legal framework that enables employers to develop more flexible business models and to adapt to market demands while maintaining employee protection. Some smaller amendments to the act were passed in 2017 and 2019 (OG 127/17 and 98/19) and these related mostly to the rights of worker representatives. In 2022, there were further amendments to the Labour Act (OG 151/22), which entered into force on 1 January 2023. Through these amendments, telework can be performed permanently, temporarily or occasionally if, based on a proposal of the employee or the employer, the employee and the employer agree on this type of work. However, it must be ensured that the nature of the work and the degree of risk are in accordance with the regulations on occupational safety. An employee who works on the employer’s premises can, in order to balance their work, family obligations and personal needs, propose to the employer an amendment to the employment contract to implement telework for a certain period of time, especially for (1) health protection due to a diagnosed illness or established disability, (2) pregnancy or parental obligations towards children until the child reaches the age of eight years old and (3) providing personal care to an immediate family member or a member of their household. In the event of extraordinary circumstances resulting from disease epidemics, earthquakes, floods and similar phenomena, the employer may, in order to continue business activities and protect the health and safety of the employees and other people, agree to employees working from home without changing the employment contract. If the extraordinary circumstances necessitating such work last longer than 30 days, the employer has to offer the employee an employment contract that details the scope and nature of the telework.

Regarding social partners’ representation, the Act on Representativeness of Employers’ Associations and Trade Unions (Zakon o reprezentativnosti udruga poslodavaca i sindikata) was adopted in 2014 (OG 93/14). It stipulates the procedure and criteria for establishing representativeness of higher-level employer and trade union associations for participation in tripartite bodies at national level. It also sets out the procedure and criteria for establishing representativeness of trade unions for collective bargaining. The act was amended slightly in 2015 (OG 26/15).

Industrial relations context

Bipartite social dialogue developed at company level, while sector-level bipartite negotiations mostly remained underdeveloped. The reasons for the inadequate spread of bipartite (especially sector-level) social dialogue are the generally weak tradition of social dialogue, the low degree of coverage of private sector employees in collective agreements, the fragmentation of trade unions, the unwillingness of the private sector to accept trade unions as partners, and trade unions’ and employer organisations’ inadequate capacities. There is no uniform system of industrial relations in Croatia and this has created a complicated precondition for establishing social partner representativeness. The first system of collective bargaining is the system of bargaining for civil and public servants and employees, whose wages are financed from the central budget; the second system is collective bargaining in public enterprises that are majority owned by the state; the third system of collective bargaining is seen in units of local and regional self-government and in public enterprises founded by them; the fourth type of collective bargaining is encountered in the private sector, which has a tradition and a system of sectoral collective agreements; finally, the fifth pattern of collective bargaining consists of in-house collective agreements in the private sector. The Croatian Employers’ Association (Hrvatska udruga poslodavaca, HUP) is the only voluntary association of employers in Croatia that participates in the bodies of tripartite social dialogue. Employer organisation density in terms of the number of employees covered was 31% in 2013 (according to the European Company Survey 2013), while, in terms of employee organisations, trade union density was 20% and works council density was 13% (European Company Survey 2013). Šeperić (2017) estimates that the general trade union density rate is around 26%, with a decreasing trend. According to the latest analysis by Schirmbeck and Šeperić (2022), there are around 280,000 trade union members in Croatia. This corresponds to approximately 20% of all employees in legal entities in Croatia.

Trade unions, employer 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 European, national, sectoral, regional (provincial or local) and company levels. This section looks at the key players and institutions and their role in Croatia.

Public authorities involved in regulating working life

The Service for Social Partnership of the Ministry of Labour, Pension System, Family and Social Policy (Ministarstvo rada, mirovinskoga sustava, obitelji i socijalne politike) is the successor of the former Government Office for Social Partnership (Ured za socijalno partnerstvo u Republici Hrvatskoj), which was later incorporated within the Ministry of Labour, Pension System, Family and Social Policy.

The body responsible for social dialogue and working conditions is the Ministry of Labour, Pension System, Family and Social Policy, while all bodies of state administration are responsible for bipartite social dialogue in their field of activities.

The Service for Social Partnership supports a wide range of activities for the advancement of communication between responsible central and local government institutions, social partners and international organisations to help them achieve their aims jointly and efficiently in the field of labour, social and economic policy. Social partnership has proven to be a stabiliser of social relationships, a model for consultation, a key information- and opinion-sharing platform, and critical in achieving wider social consensus on all relevant issues.

In accordance with the Labour Inspectorate Act (Zakon o Inspektoratu rada - OG 19/14) that was in force until 31 March 2019, the Labour Inspectorate (Inspektorat rada) operated as a part of the Ministry of Labour and Pension System. Since 1 April 2019, the new Labour Inspectorate Act (OG 115/18 and 117/21) has been in force. The Ministry of Labour, Pension System, Family and Social Policy is responsible for drafting and monitoring regulations on safety at work and for suggesting measures and encouraging activities to promote health and safety at work. The Labour Inspectorate of the Ministry of Labour, Pension System, Family and Social Policy performs inspections and other professional tasks in the field of labour and occupational health and safety, unless otherwise prescribed by a special law, that is, it inspects the implementation of laws and other regulations governing labour relations and occupational health and safety. The Labour Inspectorate is authorised to initiate administrative procedures, eliminate identified deficiencies and prohibit employers’ practices that jeopardise the lives and health of the workers.

Representativeness

The Act on the Criteria for Participation in Tripartite Bodies and Representativeness for Collective Negotiation (Zakon o kriterijima za sudjelovanje u tripartitnim tijelima i reprezentativnosti za kolektivno pregovaranje, OG 82/12 and 88/12) introduced new criteria for representativeness of the social partner organisations for tripartite consultations. For employees, the legislation on the representativeness of unions introduced detailed provisions on which unions are entitled to conclude collective agreements. The new Act on Representativeness of Employers’ Associations and Trade Unions adopted in 2014 (OG 93/14) and amended in 2015 (OG 26/15) regulates the criteria and procedures for establishing the representativeness of employer associations and higher-level trade unions for their participation in tripartite bodies at national level. It also sets out criteria and procedures for the representativeness of trade unions for collective bargaining and the entitlements of representative associations/trade unions.

Trade unions

About trade union representation

Freedom of association and the right to organise is set by the Constitution (Articles 43 and 60), the Labour Act, International Labour Organization (ILO) Conventions No. 98 and 87 and other international treaties to which the Republic of Croatia is a party. All employees, except active military staff, have the right to establish and join trade unions. According to the Labour Act (OG 93/14, 127/17, 98/19 and 151/22), Article 165, workers have the right, according to their own free choice, to establish and join a trade union, subject to only those requirements that may be prescribed by the statute or internal rules of this trade union.

In Croatia, there are no databases and/or reliable sources on trade union membership. According to Milićević Pezelj (2013), there were 320,000 trade union members in Croatia in 2012, equating to trade union coverage of around 17%. Bagić (2014) assessed the workforce covered by collective agreements per sector using the list of applicable collective agreements registered with the Ministry of Labour, Pension System, Family and Social Policy (collective agreements implemented in two or more counties) and collective agreements registered with state administration offices in counties (collective agreements implemented in one county). The study found that, of the 570 collective agreements in place, the majority (about 64%) concerned the private sector, while the rest were related to national and local government and services (13%) or public enterprises (23%). The coverage ratio was directly proportional to the number of collective agreements. The largest bargaining coverage was recorded for employees in administration and public services, followed by public enterprises, while coverage was considerably lower in private companies. About 88% of employees in bodies that avail of the state budget (both central and local government) have their rights regulated by collective agreements. The rights of around three-quarters of employees in public enterprises are regulated by collective agreements, compared with only 35% of employees in private companies. Thus, according to Bagić’s estimation, the total rate of coverage of collective agreements in Croatia in 2013 was 52.8%. This coverage rate was about eight percentage points lower than that at the beginning of the economic crisis in Croatia in 2009, when it was 61%. According to data from 2018 (SSSH, 2018), trade union density in terms of active employees was around 21%, while trade unions affiliated to representative trade union federations had 263,000 members. Schirmbeck and Šeperić (2022) estimated that, in 2021, trade union density in terms of active employees was around 20%, while Glas radnika (2023) found that, in Croatia, there are about 580 collective agreements that cover about 670,000 workers, namely about 47% of all employees. As a rule, companies established after 1990 are significantly less likely to be unionised (Schirmbeck and Šeperić, 2022).

Trade union membership and density, 2011–2021

Notes: * Proportion of employees who are members of a trade union. ** Slight changes in the methodology. *** Only members of trade unions affiliated with representative trade union federations, not including members of the Croatian Association of Trade Unions (Hrvatska udruga radnickih sindikata, HUS). **** Trade (labour) union membership of employees derived for the total (labour) union membership and adjusted, if necessary, for trade (labour) union members outside the active, dependent and employed labour force (i.e. retired workers, self-employed workers, students and unemployed people). ***** Also including members of the HUS, which merged with the Union of Autonomous Trade Unions of Croatia (Savez samostalnih sindikata Hrvatske). n.a., not applicable. No data is available for 2020.

Main trade union confederations and federations

Sources: SSSH (2018, p. 28) and Schirmbeck and Šeperić (2022)

With the new Act on Representativeness of Employers’ Associations and Trade Unions introduced in 2014 (OG 93/14 and 26/15), the government wanted the process of representativeness to be based on precise and objective criteria, in order to avoid any possibility of bias or abuse. Regarding trends in membership and representativeness, the proportion of public sector employees among total membership is on the increase (or is at least stable), while membership in trade unions in the private sector is steadily decreasing. The Act on Representativeness of Employers’ Associations and Trade Unions stipulates that a higher-level representative trade union organisation participating in tripartite bodies at national level should fulfil the following conditions in a cumulative manner. Firstly, it must have been in the register of trade union organisations of a higher level for at least six months prior to applying for recognition of representative status. Secondly, its member trade unions must represent at least 50,000 unionised employees. Thirdly, it must have at least five trade unions as its members and it must be active in various areas of activities as set out in the National Classification of Activities (Nacionalna klasifikacija aktivnosti). Fourthly, the higher-level representative trade union organisation or its member unions must have regional offices in at least four counties (of the 21 counties in Croatia). Fifthly, it must have the premises and other material conditions necessary to carry out its activities and it must employ at least five employees with a full-time employment contract, concluded for an indefinite duration.

Until 2018, four representative trade union confederations had been associated, with 367,000 members. All confederations compete for members, as none of them is specialised in particular sectors of the economy or professions (Samardžija et al, 2017). In the summer of 2018, the Committee for the Determinacy of Representation (Povjerenstvo za utvrđivanje reprezentativnosti) passed a decision on the representativeness of the higher level of trade unions (OG 59/18). According to this decision, the representative unions are the Independent Trade Unions of Croatia (Nezavisni hrvatski sindikati, NHS), the Union of Autonomous Trade Unions of Croatia (Savez samostalnih sindikata Hrvatske, SSSH) and the Association of Croatian Trade Unions (Matica hrvatskih sindikata, Matica), while the Croatian Association of Trade Unions (Hrvatske udruge radničkih sindikata, HUS) lost this status because it did not fulfil the legal requirements. The HUS merged with the SSSH in February 2020 (SSSH, 2022). On 15 July 2022, Preporod (the union of employees in the Croatian education system) became a member of the SSSH. Preporod in 2022, has almost 10,000 members from 419 primary and secondary schools throughout Croatia. In addition, new unions were established in two previously completely unorganised sectors. First, the Trade Union of Digital Platform Workers’ (Sindikat radnika digitalnih platformi Hrvatske, SRDP) was set up as a union for Uber drivers, but it aspires to organise all those working for digital platforms, no matter their formal employment status. Second, the trade union SKUPA (meaning ‘Together’), is focused on the non-profit sector but, in the long term, aspires to also represent different atypical and precarious workers.

Employer organisations

About employer representation

Freedom of association and the right to organise is set by the Constitution (Articles 43 and 60), the Labour Act, ILO Conventions No. 98 and 87 and other international treaties to which the Republic of Croatia is a party. Employers have the right, without any distinction whatsoever and according to their own free choice, to establish and join employer associations. Employers may freely decide on their membership of an association and on leaving such an association. Associations may create federations or other forms of associations in order to pursue their interests together at a higher level. Higher-level associations enjoy all the rights and freedoms granted to associations. They all have the right to freely join federations. The Act on Representativeness of Employers’ Associations and Trade Unions, Article 2, states that, to be recognised as representative for participation in tripartite bodies at national level, an employer organisation must (1) have been on the register of higher-level employer associations for at least six months, (2) represent at least 3,000 employers or have affiliated employers employing at least 100,000 workers, (3) represent at least five employer associations operating in different areas (4) have regional offices in at least four counties (5) have premises and other necessary material working conditions and (6) employ at least five employees on full-time permanent employment contracts. Since 1993, there has in fact been only one association of employers, the HUP, which represents both sectoral and employer organisation interests. The HUP has slightly fewer than 6,000 members, which employ around 400,000 workers, that is, approximately 46% of employees in companies in Croatia. Its number of members and membership density have been stable over the past 10 years. The HUP, as an employer confederation, unites 30 sector associations. Membership is not compulsory.

Employer organisation membership and density, 2012–2019

Note: * Percentage of employees working in an establishment that is a member of any employer organisation that is involved in collective bargaining.

Main employer organisations

According to the decision on the representativeness of employer associations in Croatia, from July 2007 only the HUP fulfilled the representativeness criteria, while the Confederation of Croatian Industry and Entrepreneurs (Konfederacija hrvatske industrije i poduzetnika) did not. The 2014 act on representativeness sets out, in Article 2, the employer association representativeness requirements. Thus, currently, the HUP is the only employer representative within the national Economic and Social Council (Gospodarsko-socijalno vijeće, GSV), the highest tripartite social body for social dialogue in Croatia. The HUP has four regional offices, while 30 sector associations of the HUP advocate for the specific economic interests of different sectors. The HUP is a voluntary, independent and legitimate association with the legitimate right to negotiate in the process of collective bargaining and to sign collective agreements. The HUP’s members may also actively participate in all local and/or regional economic and social councils (ESCs) in order to improve the conditions of their businesses.

Main employer organisations and confederations

Source: HUP, 2016

Tripartite and bipartite bodies and concentration

Main tripartite and bipartite bodies

Croatia has established an institutional framework for promoting social dialogue, comprising the tripartite GSV and its working bodies, which together serve as an advisory body to the Croatian government. The GSV started its work in January 1994 and consists of an equal number of representatives of the government, trade union confederations and employer associations. The GSV committees deal with the issues of wage policy, the tax system, social policy, employment, education, and legislation pertinent to the issues of labour, employment and industry. The tripartite social dialogue that began at national level has since progressed to be developed at regional level by the establishment of regional ESCs at the level of each county. The criteria for participating in a regional ESC are the same as those for the GSV.

The proposed social partnership at regional level was designed to engage and support the regional business environment by improving communication and cooperation between the government, regional and local administration, business and labour. However, there are considerable differences in their levels of activity and effectiveness. At the level of companies, institutions and particular sectors and industries, bipartite social dialogue is developed through the activities of the trade unions and employer associations that conclude collective agreements and facilitate trade union activities in companies, works councils and supervisory boards. In addition, social partners are represented in working bodies within the Croatian parliament, the National Council for Protection at Work (Nacionalno vijeće za zaštitu na radu), the National Council for Competitiveness (Nacionalno vijeće za konkurentnost), the National Committee for Monitoring the Negotiations with the EU (Nacionalni odbor za praćenje pregovora o pristupanju RH Europskoj uniji), governing boards of the Croatian Pension Insurance Institute (Hrvatsko zavod za mirovinsko osiguranje) and other public institutions.

The GSV was inactive for a long period, namely from its 221st meeting on 26 June 2018 to its 222nd meeting on 27 March 2020. The reasons for this were some serious disputes between the trade unions and the government about the functioning of the GSV, along with other issues related to its role in the pension reform, which resulted in trade unions’ cancellation of their participation in the GSV. With the intention to revive the GSV, the government and social partners signed, on 11 March 2020, an agreement for establishing the GSV. This body represents the highest (institutional) form of tripartite social dialogue at national level and it provides an opportunity for social partners to play an important and active role in creating and implementing public policies. Since then, the GSV has regularly held meetings and discussed various topics, ranging from reforms of the tertiary education system to the government’s measure for lessening the energy prices and inflation pressure.

Main tripartite and bipartite bodies

Workplace-level employee representation

According to the Labour Act, trade unions are the only actors entitled to conclude collective agreements in the Republic of Croatia on behalf of workers, whereas, on the employer side, a party to a collective agreement can be an individual employer or an employer association. Works councils also have the right to make certain agreements with the employer, but those agreements must not regulate matters related to wages, the duration of working time or other issues that the Labour Act stipulates may be regulated by a collective agreement. In that way, apart from the freedom of association and activity, trade unions are ensured collective bargaining monopoly. Works councils in Croatia are relatively rare and they are mostly strongly influenced by trade unions.

Regulation, composition and competencies of the representative bodies

The central concern of employment relations is the collective governance of work and employment. This section looks at collective bargaining in Croatia.

Bargaining system

The Act on Representativeness of Employers’ Associations and Trade Unions set out the representativeness criteria for the conclusion of collective agreements in Croatia. If only one union represents an organisation’s employees, then that union must be recognised as the representative union for collective bargaining. This is regardless of the number of union members and the proportion of employees with union membership. If more than one trade union represents the employees at an organisation, then all of these unions must agree which union (or unions) is (are) the representative(s). The law stipulates that a collective agreement is valid only if it is signed by the representative trade union(s) that represent(s) at least 50% of the members of the representative trade union(s). The agreement on the representativeness has to state the number of members of each representative trade union. If the trade unions cannot agree on the trade union representativeness, then it is decided by the Commission for Determining Representativeness (Povjerenstvo za utvrđivanje reprezentativnosti). Collective agreements are legally binding. Collective bargaining in Croatia is decentralised in the private sector and is mostly centralised in the public sector. It is still possible to collectively negotiate on every level – that is, on the conclusion of the collective agreement that will apply to employees of a single employer, several employers or an employer association.

Patterns and features of collective bargaining in the private sector and the public sector (that is, civil and public services and public enterprises) differ significantly; therefore, there is no single and uniform system of collective bargaining with a similar hierarchical structure and dynamics.

Collective wage bargaining coverage of employees, all levels

Note: * Percentage of employees working in local units where more than 50% of the employees are covered under a collective pay agreement against the total number of employees who participated in the survey.

Sources: Eurofound, European Company Survey 2013 and 2019 (including private sector companies with establishments with >10 employees (Nomenclature of Economic Activities (NACE) codes B–S), with multiple answers possible); Eurostat [earn_ses10_01], [earn_ses14_01], [earn_ses18_01], Structure of Earnings Survey 2010, 2014 and 2018 (including companies with >10 employees (NACE codes B–S, excluding O), with a single answer for each local unit)

Collective wage bargaining coverage is about eight percentage points lower than it was at the beginning of the economic crisis in Croatia in 2009, when it was 61%. The adverse impact of the economic crisis had a particularly negative effect on the overall level of bargaining coverage on employment in civil construction and in tourism and hospitality, two important sectors in which sectoral collective agreements were extended by the Minister of Labour’s decision to all employees in these sectors. In 2009, the construction sector employed about 100,000 workers, namely around 8.3% of all employees, while, by the end of 2013, that number had fallen to about 70,000 and a proportion of 6.4% of employees. The construction sector has recovered since then and, in March 2022, it employed 105,000 workers, that is, around 7.8% of total employment in Croatia. A similar trend was recorded in the tourism and hospitality industry.

The most common type of collective bargaining encountered in the private sector is a traditional system of sectoral collective agreements. Such a system has been established in only a small number of activities, with slightly different forms of collective bargaining. There are relatively narrow categories of activities in which collective agreements are signed for a definite period in regular cycles, but those that do include private healthcare practice, humanitarian demining and maritime transportation of freight and passengers. In these activities, as a rule, collective agreements have not been extended by an administrative decision of the Minister of Labour and are applied only by employers that are members of the relevant association, meaning that the collective agreement provisions are probably widely applied. Another type of sectoral collective agreement consists of the agreements for the construction industry, the hotel and catering industry, travel agencies and the wood and paper industry, which were concluded a relatively long time ago for an indefinite period and apply to all employees and employers in these sectors thanks to administrative extension. These agreements are responsible for most of the collective bargaining coverage, although the number of employees that they actually apply to in practice in unclear. A considerable number of employers have no instruments to control their application. Some of these agreements are very dynamic and up to date, even though they have been concluded for an indefinite period, because of regularly signed annexes and additions through which certain provisions are adjusted to the conditions in the sector in question, including the regulation of the base wage. Others regulate only general issues and rights, but not the basic wage, so the specific issues are addressed through additional in-house agreements (for instance the collective agreement for catering). As a rule, these agreements do not contain unambiguous mechanisms for harmonising wages with macroeconomic and/or microeconomic indicators.

Another pattern of collective bargaining in the private sector consists of in-house collective agreements. Within this pattern there is also a certain heterogeneity, both in terms of the duration of the bargaining cycle (ranging from one-year agreements to agreements concluded for an indefinite period) and in terms of the content. These agreements are mainly present in large enterprises (with over 250 employees) and to a lesser extent in medium-sized companies (50–250 employees). There are also significant differences between sectors – they have a much greater impact in the mining and extraction, finance and insurance, and manufacturing sectors. However, unlike agreements for the public sector, these agreements as a rule precisely regulate the level of basic wages, but rarely contain specifically designed mechanisms for harmonisation of the basic wage with macroeconomic and microeconomic indicators. In general, collective agreements in the private sector, as far as other material rights are concerned, tend to imitate in terms of structure the material rights in the public sector (including public enterprises and state and public administration), but often differ in the number of individual rights. The numbers of these agreements are often low, but in successful sectors and enterprises can be significantly higher. It should be noted that, in several cases in the private sector, there has been a reduction in certain material rights of employees as part of the adjustment of the enterprise and the sector to the effects of the economic crisis.

Finally, it should be noted that there is a significant segment of the private sector, mainly in small and in some medium-sized enterprises of the service industry, in which the rights of employees have not been regulated by collective agreements at all. Unfortunately, there are no analyses to show the extent to which this has a negative impact on the level of wages or other material rights of these employees. There are no other recent data.

Bargaining levels

Employers express greater interest in concluding collective agreements at company level than in collective bargaining at industry, sectoral or regional level. This is supported by the fact that the number of collective agreements at industry, sectoral or regional level in Croatia is very small.

Levels of collective bargaining, 2022

Articulation

Croatia is characterised by very weak links between the different bargaining levels. Most bargaining is at company level, although there are some sectors – such as construction and catering, as well as the public sector – where there are sectoral collective agreements, sometimes in addition to company-level deals.

Timing of the bargaining rounds

Bargaining rounds take place throughout the year, and there is no specific period of the year when they take place or a pattern over the year.

Coordination

Horizontal and vertical coordination is weak primarily because of the generally weak tradition of social dialogue, the low degree of coverage of private sector employees in collective agreements, the unwillingness of the private sector to accept trade unions as partners, and trade unions’ and employer associations’ insufficient capacities. In the context of a grave economic and social situation and alarming unemployment rates, the trade unions have begun to coordinate more effectively in the last few years, but coordination is still relatively weak among them, across the sectors and various levels.

Extension mechanisms

Extension of the application of a collective agreement is stipulated in the Labour Act, Article 203. The Minister of Labour may, at the request of all parties to a collective agreement, extend the application of a collective agreement concluded with an employer association or a higher-level employer association to an employer that is not a member of the employer association or higher-level employer association in question. The minister will decide if the extension of the collective agreement is in the public interest and determine if the collective agreement was concluded by the trade unions with the largest numbers of members and an employer association with the largest number of workers at the level for which it is to be extended.

Derogation mechanisms

Derogation from minimal standards set by law is stipulated in some of the collective agreements and it is possible to derogate from those collective wage agreements after agreement between the representative company trade union (or national trade union) and the employer, mainly in order to save jobs. Through a temporary employment contract (Labour Act, Article 46), it is possible to derogate from the general legal regulation on the remuneration and other working conditions applicable to the temporary workers assigned to the undertaking, namely that these cannot be lower or less favourable than those applicable to the workers employed with the undertaking in question for the performance of the same tasks. It is possible to set less favourable working conditions for temporary workers than for workers employed at the company in a collective agreement concluded between the temporary employment agency or an association of agencies and trade unions.

Expiry of collective agreements

Article 199 of the Labour Act sets out the possibility for the extended application of legal rules contained in a collective agreement. Following the expiry of a collective agreement, the legal rules it contains for the contents and termination of employment contracts continue to apply until a new collective agreement is concluded for up to three months after the original expiry date. A collective agreement may stipulate a longer period of extended application of its legal rules.

Peace clauses

In principle, there are no peace clauses within collective agreements and they are not used. However, Article 205 of the Labour Act stipulates that:

(1) Trade unions shall have the right to call and undertake a strike in order to protect and promote the economic and social interests of their members or on the ground of non-payment of remuneration or compensation, or a part thereof, if they have not been paid by their maturity date.

(4) A strike may not begin before the conclusion of the mediation procedure, when such a procedure is provided for by this Act, or prior to the completion of other amicable dispute resolution procedures agreed upon by the parties.

(5) A solidarity strike may begin even if the mediation procedure has not been conducted, but not before the expiration of two days from the date of commencement of the strike in whose support it is organised.

Article 206 defines disputes in which mediation is mandatory:

(1) In case of dispute, which could result in a strike or other form of industrial action, the mediation procedure must be conducted as prescribed by this Act, except when the parties have reached an agreement on an alternative amicable method for its resolution.

(2) The mediation referred to in paragraph 1 of this Article shall be conducted by the mediator selected by the parties to a dispute from the list established by the Economic and Social Council or determined by mutual agreement.

The consequences of the organisation of a strike or participation in a strike are set out in Article 215:

(1) Organisation of a strike or participation in a strike, which is organised in compliance with the law, collective agreement and trade union rules, do not constitute a violation of an employment contract.

Other aspects of working life addressed in collective agreements

As the building sector was particularly hard hit by the economic crisis, the amendments to the collective agreement for this sector demonstrate how adverse consequences can be lessened. Some collective agreements also address other working conditions such as working time.

Legal aspects

The right to strike (štrajk) and/or to stage a solidarity strike (štrajk solidarnosti) exists for workers, while employers may lock workers out only as a response to a strike already in progress. A lockout must not begin until eight days after a strike has begun. The Labour Act, Article 205, stipulates that trade unions have the right to call and undertake a strike in order to protect and promote the economic and social interests of their members, or because remuneration and compensation has not been paid. In any dispute related to the conclusion, amendment or renewal of a collective agreement, the right to call and stage a strike is held by trade unions that have been determined to be representative for the purposes of collective bargaining.

A strike must be announced to the employer, or to the employer association, against which it is directed, whereas a solidarity strike must be announced to the employer on whose premises it is organised. A letter announcing the strike must state the reasons for the strike; the place, date and time of its commencement; and the method of its execution. Article 206 of the Labour Act sets out that, in the case of a dispute that could result in a strike or other form of industrial action, a mediation procedure must be conducted, except when the parties have reached an agreement on an alternative method for its resolution. Mediation is conducted by an independent mediator selected by the parties to a dispute, chosen either from the list compiled by the GSV or by mutual agreement.

Dispute resolution mechanisms

Collective dispute resolution mechanisms

The Labour Act, Article 205, stipulates that a strike may not begin before the conclusion of the mediation procedure, when such a procedure is provided for by this act, or prior to the completion of other amicable dispute resolution procedures agreed upon by the parties. 

Resolution of disputes by mediation

The previously mentioned obligatory mediation is conducted by a mediator selected by the parties to a dispute from the list compiled by the GSV or determined by mutual agreement. Mediators’ fees are set by a decision of the minister responsible for labour affairs based on a prior opinion of the GSV and with the consent of the Minister of Finance. The minister must, alongside a prior opinion of the GSV, adopt an ordinance regulating the methods for the selection of mediators, the conduct of the mediation procedure and the performance of the administrative work necessary for this procedure. Article 208 determines the time limit for the completion of the mediation procedure. Unless otherwise agreed by the parties to a dispute, the obligatory mediation provided by the Labour Act must be completed within five days following the submission of information about the dispute to the GSV or to a state administrative office in a county responsible for labour affairs.

Resolution of disputes by arbitration

The Labour Act, Articles 210–212, provides for the resolution of disputes by arbitration. Parties to a dispute may agree to bring their collective labour dispute before an arbitration body. The appointment of an individual arbiter or an arbitration board and other issues related to the arbitration procedure may be regulated by a collective agreement or by an agreement of the parties made after the dispute has arisen. The issues that can be decided by arbitration are set out in Article 211. This article stipulates how, in their agreement to bring a dispute before an arbitration body, the parties must delineate the issue to be resolved. The arbitration body may decide only upon the issues brought before it by the parties to a dispute. If a dispute concerns the application of laws and regulations or a collective agreement, the arbitration body bases its decision on the appropriate legislation, regulation or collective agreement. If a dispute concerns the conclusion, amendment or renewal of a collective agreement, the arbitration body bases its decision on equitable grounds. Unless the parties to a dispute specify otherwise in a collective agreement or an agreement to bring a dispute before an arbitration body, an arbitration award must include the reasons for the award. No appeal is permitted against an arbitration award. If a dispute concerns the conclusion, amendment or renewal of a collective agreement, the arbitration award has the legal force and effect of such an agreement.

Individual dispute resolution mechanisms

Article 209 of the Labour Act regulates decisions made by the parties and their effects and states that parties may finalise the mediation procedure with an agreement. An agreement reached in the event of a dispute related to the conclusion, amendment or renewal of a collective agreement has the legal force and effect of a collective agreement. An agreement reached in the event of a dispute over remuneration and compensation may be used to agree upon the method and dynamics of payment.

Data from the former Government Office for Social Partnership show that 100 cases were dealt with in 2012 (45 settled or conditionally settled) and 137 were dealt with in 2013 (70 settled) – a significant increase in comparison with the 2011 figures of 100 cases (46 settled). Both the number of cases and the percentage successfully resolved decreased in 2014 and, while the absolute number of cases also decreased in 2015 and 2016, the percentage of successfully resolved cases increased in both of these years. In 2017, the absolute number of mediations in collective labour disputes increased significantly, while the percentage of successfully resolved cases increased by one percentage point. The number of cases increased in 2018 and 2019, but the percentage of successfully resolved cases decreased. In 2020, the number of cases decreased significantly, while the percentage of successfully resolved cases slightly decreased. 

Use of dispute resolution mechanisms, 2012–2020

Note: Data is only available until 2020.

Source: GSV, undated

‘Individual employment relations’ refers to 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 terms and conditions. This section looks at the start and termination of the employment relationship and entitlements and obligations in Croatia.

Start and termination of the employment relationship

Requirements regarding an employment contract

According to Article 19 of the Labour Act, it is prohibited to employ a person under 15 years of age (or between 15 and 18 years if they are still subject to compulsory full-time elementary schooling). When a legal representative authorises the conclusion of an employment contract for a minor (with the exception of a minor who is still subject to compulsory full-time elementary schooling), the minor has legal competence for concluding and terminating such a contract and for taking any legal actions. Article 19(a) of the Labour Act sets out the special protection of children and minors. It establishes that a child, in the sense of this act, is a person who is younger than 15 years, while a minor is a person who has reached the age of 15 or is older than 15 and younger than 18 years, while Article 19(b) specifies the conditions and characteristics of people who work with minors. An amendment to Article 19(b) specifies employers’ duties regarding the special protection of children and minors. An amendment to Article 21 stipulates that the employer may not employ a minor before prior determination of the minor’s medical capacity. Furthermore, the minister responsible for labour affairs, with the prior consent of the minister responsible for health, prescribes by ordinance the preliminary determination of the health capacity for work of minors.

For employees who work from home (that is, at a separate workplace from their employer), if an employee makes a request for the employer to amend the employment contract through which working from home is regulated, the employer is obliged to respond to the employee and can reject the request only for a justified reason, which must be explained in writing to the employee no later than 30 days after receiving the proposal. In addition to including the information set out in Article 15 of the Labour Act, an employment contract concluded in writing by which the employer and the employee agree to work at separate workplaces must also contain additional information about (1) the organisation of work that enables the availability of employees and their unhindered access to the business space, information and professional communication with other workers and the employer, as well as third parties in the business process; (2) the method of recording working hours; (3) means of work for the performance of work that the employer is obliged to acquire, install and maintain; (4) compensation for expenses incurred due to the performance of work, which the employer is obliged to pay to the employee if the work at a separate workplace is contracted as permanent or when the period of work at a separate workplace lasts longer than 15 working days continuously; (5) the method of training and professional development of the employees; (6) the way of exercising the right to employees’ participation in the decision-making process; and (7) the duration of work at a separate workplace.

Dismissal and termination procedures

Article 115 of the Labour Act allows an employer to dismiss workers for certain reasons. These comprise the specific nature of the work, in terms of organisation and technology; the employee’s personal characteristics; misconduct; and failure to measure up to the work standards during the probationary period. When a worker is dismissed because of the changing nature of the work, their tenure, age and family circumstances have to be taken into consideration.

Entitlements and obligations

Parental, maternity and paternity leave

Statutory leave arrangements, 2019

Sick leave

Calculation of the sickness cash benefit provided by the Croatian Institute for Health Insurance (Hrvatski zavod za zdravstveno osiguranje) is based on the average net wage in the six months preceding the month of sickness. It is paid in full (100% of the calculation base) when the sickness is a result of the Homeland War, for injury that occurred during work, for nursing a sick child under three years of age, for the donation of tissues and organs, in the case of the need to isolate or for complications during pregnancy. In all other instances, it amounts to 70% of the calculation base. After six months of continuous sick leave, the amount increases to 80%. It is regulated by the Act on Mandatory Health Insurance (Zakon o obveznom zdravstvenom osiguranju; OG 80/13, 137/13 and 98/19), the Book of Rules Regarding Longest Duration of Sick Leave Depending on the Type of Disease (Pravilnik o rokovima najduljeg trajanja bolovanja ovisno o vrsti bolesti; OG 153/09), the Labour Act and the Act on Maternity and Parental Benefits. The new Act on Maternity and Parental Benefits (OG 152/22) has been in force since 1 January 2023.

Retirement age

The retirement age for men is 65 years, while the retirement age for women increased to 63 years in 2022 and to 63.25 years in 2023, from 60.5 years in 2012. The legal retirement age for women rises every year by three months, with the intention to reach 65 years by 2030. There is a possibility to take early retirement a maximum of five years before the official retirement age with a reduction in the amount of the pension of 0.2% for each month of early retirement ( Zakon o izmjenama Zakona o mirovinskom osiguranju, the Law on Amendments to the Law on Pension Insurance, OG 102/19, Article 4).

For workers, pay is a reward for their work and their main source of income; for employers, it is a cost of production and a focus of bargaining and legislation. This section looks at minimum wage setting in Croatia.

Nominal wages increased between 2013 and 2021 in all sectors. The average monthly net earnings per person in paid employment in legal entities for 2021 amounted to HRK 7,129 (€946), which was 30.9% higher (HRK 1,704 (€226) more) than the net wage in 2013 (HRK 5,515 (€735)). The highest average monthly net earnings per person in paid employment in 2021 were in financial and insurance activities and amounted to HRK 9,757 (€1,295), while in 2013 it was HRK 78,701 (€1,049) for this area of activity. The lowest earnings in 2021 were in administrative and support service activities and amounted to HRK 5,336 (€708), while in 2013 it was HRK 3,510 (€468) for this area of activity. In 2013–2017, the average wage in the public sector was about 25% higher than in the private sector, but this difference reduced in 2018–2019 to around 13% (Laušić, 2018). In the case of state-owned enterprises in 2013–2017, the average wage was around 20% higher than in the private sector. The difference in educational attainment is an important determinant of the observed differences in average wages by sector, so the benefits in terms of wage levels gained from higher education is somewhat higher in the private sector.

Average monthly net earnings per person in paid employment in legal entities (HRK), 2012–2021

Note: NKD, National Classification of Activities (Nacionalna klasifikacija aktivnosti). n.a., not applicable.

Source: Croatian Bureau of Statistics (undated)

Average monthly net earnings per person in paid employment in legal entities (€), 2012–2021

Source: Croatian Bureau of Statistics (undated)

Average monthly gross earnings per person in paid employment in legal entities (HRK) by professional attainment, 2013–2020

Source: For 2013–2020, Croatian Bureau of Statistics (undated)

Average monthly gross earnings per person in paid employment in legal entities (€) by professional attainment, 2013–2020

Source: For 2016–2020, Croatian Bureau of Statistics (undated)

Minimum wages

In the early years of transition, Croatia had a form of minimum wage called the guaranteed wage. In that period, the government played the leading role and set the minimum wage level each quarter. With certain legislative changes, from 1993 to 1995, the government continued to amend the minimum wage level but did so only occasionally and irregularly at a relatively low level that had no significant influence on the economy. The version of the Labour Act that came into force in 1996 provided a completely new framework for labour market regulation and strengthened the role of collective bargaining. According to the act, the government was still allowed, but not compelled, to set a minimum wage in consultation with the social partners. In reality, no minimum wage level was set in 1996 or 1997. In March 1998, Croatia reintroduced the minimum wage after the conclusion of the national collective agreement on the lowest wage, and an immediate extension was introduced to all those workers and employers that were previously uncovered. The agreed minimum wage was generally binding. A new stage in the regulation of the minimum wage emerged with the introduction of the Minimum Wage Act (Zakon o minimalnoj plaći) on 1 July 2008. Major changes from the previous system included a statutory regulation, defined penalties for non-compliance, a substantial one-off hike in the level of the minimum wage, a sub-minimum rate for specific sectors and the introduction of a specific adjustment formula. In the new system, the minimum wage is defined as a single rate, with a temporary derogation in the form of a sub-minimum rate for specific industries.

Monthly minimum wages, 2013–2023

Note: * The amounts are the same for young workers.

When calculating the minimum wage, the average wage indicator and the GDP rates in the previous year are used. The Croatian Bureau of Statistics uses the following elements:

• the minimum wage of the previous year
• the average wage
• the growth rate of the real GDP in the previous year

This formula has been problematic because the growth rate of real GDP can be either positive or negative. In practice, however, if the growth rate of real GDP is negative, it is ignored in the calculation. In February 2013, the government proposed an amendment to the Minimum Wage Act (OG 30/13) to determine the value of the minimum wage in relation to the following more ‘socially sensitive’ indicators:

• the monthly poverty risk threshold for a single-person household
• the coefficient of the total number of inhabitants
• the total number of households
• the coefficient of the total number of economically active workers
• the change in the average index of consumer goods prices

For 2014 and 2015, the level of the minimum wage was determined by the government following consultation with the social partners. For 2016, 2017 and 2018, the level of the minimum wage was determined unilaterally by the government. The minimum wage is not differentiated for different groups of workers. An amendment to the Minimum Wage Act (OG 120/21, Article 2(3)) stipulates that the minimum wage must be contracted, defined or prescribed in the gross amount. Article 2(4) specifies that wage increases based on overtime work, difficult working conditions, night work and work on Sundays, holidays or any other day for which no work is stipulated by law are not included in the amount of the minimum wage. Furthermore, the act states that the wage increases apply to all workers to whom the collective agreement has been extended. Since 2019, the Commission for Monitoring and Analysis of the Minimum Wage (Stručno povjerenstvo za praćenje i analizu kretanja minimalne plaće) has been active. It consists of trade union and employer representatives as well as representatives from academia. The commission is a consultative body to the Minister of Labour, analysing recent trends relevant for minimum wage policy and proposing the minimum wage level for the next year. Through the amendments to the Decision of the Establishment (Odluka o osnivanju Stručnog povjerenstva za praćenje i analizu kretanja minimalne plaće – OG 136/21), the commission’s tasks were better specified. The commission, among other activities, continuously monitors and studies wage and minimum wage trends in the broader context of social policy, employment policy, combating the shadow economy, and the tax burden on workers and employers. It also analyses the possible impact of the increase in the minimum wage on the economy, employment, labour productivity, living standards and other areas of life and work and, accordingly, provides recommendations and guidelines for the further development of the minimum wage.

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

Working time regulation

Article 61 of the Labour Act stipulates that a normal working week is 40 hours, which may be evenly or unevenly distributed. If hours of labour are unevenly distributed, a working day can be either longer or shorter than is usual. Such patterns are defined by law, collective bargaining, the agreement struck between the works council and the employer, and the individual employment contract. According to Article 66(5), an employee is not supposed to work in such a pattern for less than one month or longer than a year. In any case, the total number of hours worked should correspond to those in full-time or part-time employment. In such a case, a maximum of 60 hours can be worked, including overtime, but, in any four successive months, no more than 48 hours a week can be worked, on average, including overtime.

Overtime regulation

Article 65 of the Labour Act stipulates that, in the case of force majeure, an extraordinary increase in the scope of work or in other similar cases of pressing need, the worker may, at the employer’s request, work longer than the full-time or part-time working hours (overtime work). When the employer, due to the nature of the pressing need, is not in a position to hand over a written request for overtime work before it begins, the employer is obliged to confirm the oral request in writing within seven days from the date that overtime work was requested. If the worker works overtime, the total working time of the worker may not exceed 50 hours a week. The overtime work per worker may not exceed 180 hours a year, unless otherwise provided for in a collective agreement, in which case it may not exceed 250 hours a year. Overtime work by minors is prohibited.

Part-time work

Article 62 of the Labour Act regulates part-time work, which is defined as any working time that is shorter than a full-time week. A worker may not combine work at several employers to work more than a full-time week. With the consent of the first employer, a worker can work for up to eight hours a week with another employer, but can do so for no more than 180 hours a year. A worker cannot have a second job without informing their full-time employer. When the length of service is important for the exercise of rights arising from employment, part-time work is equated with full-time work. Apart from special derogations, regular pay and other remunerations such as holiday pay and bonuses are paid in proportion to the working time.

Part-time employment as a proportion of total employment fell from 5.6% in 2012 to 4.5% in 2020, according to Eurostat. In comparison with the EU27 average, Croatia has a low proportion of people that work part-time, and this proportion further decreased during 2012–2020, with a slight increase in 2015. This difference between the EU average and Croatia is particularly noticeable for women. The proportion of women in part-time jobs in the EU is more than four times higher than in Croatia.

Night work

The Labour Act contains provisions on night work in Articles 69, 70 and 72. Night work means any work performed between the hours of 22:00 and 06:00 and, in the agriculture sector, between 22:00 and 05:00. In the case of minors working in industry, any work between 19:00 and 07:00 is regarded as night work. In the case of minors not working in industry, any work between 20:00 and 06:00 is regarded as night work. A night worker is any worker who regularly works at least three hours of their daily working time as a normal course during the night time and any worker who works at least one-third of their daily working time during a period of 12 successive months during the night time. Normal working hours for night workers may not, over a period of four months, exceed an average of eight hours in any 24-hour period. When, based on a danger assessment carried out pursuant to specific provisions on protection at work, the night worker is exposed to special hazards or heavy physical or mental strain, the employer must ensure that the worker does not work more than eight hours in any period of 24 hours during which they perform night work.

Night work by minors is prohibited, unless such work is a pressing need in business activities regulated by special legislation and where it may not be performed by adult workers; in such a case, the minor cannot work between 00:00 and 04:00, nor can the minor work longer than 8 hours in any period of 24 hours during which they perform night work. The employer must ensure that such work is performed under the surveillance of an adult. In organising night work, the employer is obliged to take special care to adapt the organisation of work to the worker and ensure that health and safety protection is adapted to the nature of night work. The employer is obliged to provide night workers with a health assessment before their assignment and thereafter at regular intervals. If a health assessment establishes that the night worker suffers from health problems connected with the fact that they perform night work, the employer is obliged to ensure that the worker can perform the same job in the day time. When the employer is not able to ensure the transfer to day work, it must offer the worker an employment contract for a type of day work to which the worker is suited and that, to the greatest possible extent, is comparable to the work previously performed by the worker. The amendments to the Labour Act (OG 151/22) specify in Article 94(1) that, for overtime and night work, the worker has the right to an increased salary, of the amount and in the manner determined by the collective agreement, work regulations or work contract, but the amendments do not stipulate the rate of increase.

Shift work

The Labour Act sets out provisions on shift work in Articles 71 and 72. Shift work means any method of organising work in shifts, whereby workers succeed each other at the same workstation according to a certain pattern, which may be continuous or discontinuous. A shift worker is any worker who performs their work in different shifts, working for an employer whose work is organised in shifts, based on patterns of working time, for a period of one week or one month. When the work is organised in shifts that include night work, shifts must be changed to limit the length of uninterrupted work in a night shift to a maximum of one week. In organising shift work, the employer is obliged to take special care to adapt the organisation of work to the worker, to ensure that health and safety protection is adapted to the nature of shift work and to ensure that sufficient protection and prevention services are available at any time.

Weekend work

There are no specific provisions regarding weekend work in the Labour Act. When defining a weekly break, the Labour Act, Article 75, sets out that workers are entitled to a weekly minimum uninterrupted rest period of 24 hours plus the hours of daily rest and that minors are entitled to a weekly minimum uninterrupted rest period of 48 hours. The rest period must be used by the worker on Sundays or the day before or after Sunday. The amendments to the Labour Act (OG 151/22) stipulate in Article 94(1) that, for difficult working conditions, overtime, night work, work on Sundays, work on holidays and work on non-working days determined by a special law, the worker has the right to an increased salary, of the amount and in the manner determined by the collective agreement, work regulations or work contract, and that the increase for each hour of work on Sundays cannot be less than 50%.

Rest and breaks

According to the Labour Act (Articles 73–75), workers who work at least six hours a day are entitled to a daily period of rest (a break) of a minimum of 30 minutes. Minors who work at least four hours a day are entitled to a daily period of rest (a break) of a minimum of 30 consecutive minutes. Part-time workers or minors who work for two or more employers with total daily working hours of at least 6 or 4.5 hours, respectively, are entitled to a break at each employer proportionate to their contracted working time. The rest period is counted in working time. Adult seasonal workers performing work that involves two periods of work split up over the day are entitled to a minimum daily rest period of eight consecutive hours.

Workers are also entitled to a minimum daily rest period of 12 consecutive hours per 24-hour period, and to a weekly minimum uninterrupted rest period of 24 hours plus the hours of daily rest. Minors are entitled to a weekly minimum uninterrupted rest period of 48 hours. The rest must be used by the worker on Sundays or the day before or after Sunday. When the worker is not in a position to use the rest period on these days, they must be afforded equivalent periods of compensatory weekly rest immediately after their working time that included no weekly rest or had a shorter period of rest than required. As an exception, shift workers or workers who, due to objective reasons or the organisation of work, cannot make use of the rest period must be afforded a weekly minimum uninterrupted rest period of 24 hours, without counting the daily rest.

Working time flexibility

Working time flexibility occurs in Croatia in diverse ways. Many newly employed workers have fixed-term contracts. A lot of shift work and weekend work takes place, but there is relatively little night and evening work. Fixed-term contracts were on the decline until the start of the economic crisis in 2009, but since then have gained in importance. Flexible working is relatively uncommon, as part-time work outside the farm sector is rare. The data show that 74% of employers report that none, or fewer than 20%, of their employees can vary the start and end of their working day according to their personal needs.

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 at psychosocial risks and health and safety at work in Croatia.

Health and safety at work

The Occupational Health and Safety Act (OG 71/14, 118/14, 94/18 and 96/18) introduced, for the first time, measures to protect workers from psychosocial risks (stress) and psychophysiological effort at work, with the aim of preventing risks and educating all stakeholders. The act sets out the general principles of risk prevention at work and the protection of health, measures to eliminate risk factors, procedures for training workers, and procedures for providing information to and undertaking consultations with employees and their representatives and employers and their representatives. The intention is to raise awareness among and encourage preventive action by not only employers but also employees.

Psychosocial risks

Work intensity, defined as working to tight deadlines at least a quarter of the time, was, in 2005, reported in the EU27 by 61.8% of respondents, while, in the same year in Croatia, it was reported less, namely by 43.6% of respondents (Šverko and Galić, 2009). The situation did not change significantly over time in the EU27 – 62.0% of respondents faced the same problem in 2010 – but the deterioration was very pronounced in Croatia, where, by 2010, 60.6% of respondents reported a rise in work intensity, which was just 1.4 percentage points less than the EU27 average.

On average, people in Croatia are slightly less exposed to long working hours than people in the EU27 as a whole. In the EU27, 36.3% workers in 2005 and 32.3% in 2010 reported that they had to work 10 hours or more in a working day at least once or more per month, compared with 34.8% in 2005 and 28.0% in 2010 in Croatia.

The purpose of the Occupational Health and Safety Act (Article 1(2)) is to systematically improve health and safety protection at work and prevent injuries at work, occupational diseases and other work-related diseases. Article 3 defines stress at work as follows: health and psychological changes that are the result of the accumulating impact of stressors at work over a longer period of time. These may be manifested as physiological, emotional and cognitive reactions and as behavioural changes of the employee.

The general principles of prevention are stipulated in Article 11. The employer is obliged to implement occupational health and safety measures based on the general principles of prevention. These include risk avoidance, risk assessment, the prevention of risks at their source, the adjustment of employees’ work in relation to the design of the workplace, the choice of work equipment, and the mode of operation and work processes to relieve monotonous work. Other issues include work at a set pace, result-based work in a given period of time (normative work) and other measures to reduce their harmful effect on health. Employers must consider issues such as adaptation to technical progress and replacing hazardous substances or processes with non-hazardous or less hazardous options.

Employers are also required to develop a consistent comprehensive prevention policy through a combination of technology, the organisation of work, working conditions, human relationships and the influence of the work environment. They must give priority to collective protective measures over individual measures, appropriately train and inform employees and make all protective equipment available free of charge.

The general obligations of the employer for the organisation and implementation of occupational health and safety are established by Article 17(7), and the measures, rules, procedures and activities of the occupational health and safety of employees exposed to statodynamic, psychophysiological and other exertions are to be regulated by ministerial ordinance.

Croatia participates in EU campaigns on stress and psychosocial risks in the workplace, and the institution in Croatia responsible for this campaign is the Croatian Health Insurance Fund.

Skills are the passport to employment; the more highly skilled an individual, the more employable they are. People with good skills also tend to secure better-quality jobs and better earnings. This section briefly summarises the Croatian system for ensuring skills and employability and looks at training provision.

On 1 April 2022, the adult educational vouchers programme was launched, and both employed and unemployed people can apply for vouchers. The voucher can have a value up to HRK 10,000 (€1,333) and can be used for adult education and lifelong learning in private and public education institutions exclusively for obtaining digital and green skills. <By the end of July 2022, 2,221 people had acquired a voucher, which is administrated by the Croatian Employment Service (Hrvatski zavod za zapošljavanje, HZZ) together with the Ministry of Labour, Pension System, Family and Social Policy. The HZZ states that the 4,195 vouchers were used in 2022, what is 195 more than planned the 4,000 vouchers (Udiljak, 2023). A total of 30,000 vouchers will be offered over the next four years. To qualify for a voucher, a person must be at least 15 years old and have at least a primary school education. The same conditions apply regardless of whether applicants are employed in the private, public or state sector. Edu6cation programmes last up to 6 or 10 months, depending on whether the applicant is unemployed or employed (Špiljak, 2022).

National system for ensuring skills and employability

Knowledge, skills and competencies are essential prerequisites for a competitive society, yet Croatia is still far below the EU average in all of these areas. One of the main problems of the labour market in Croatia is that there is a lack of qualified human capital and a mismatch between skills and labour market needs. In Croatia, an important issue is the insufficient link between the education arena, the economy and employers; not enough attention is given to the estimates of future trends and needs of the labour force. This causes problems in providing education and skills programmes that are compatible with the skills and occupations sought on the labour market. One of the main reasons for the high rates of unemployment among young people in Croatia is a widespread skill mismatch. In 2014, the Strategy for Education, Science and Technology (Strategija obrazovanje, znanosti i tehnologije) was drawn up, with participation from representatives of social partner organisations in the working groups. It strongly emphasises the importance of better connecting education and training to the labour market and improving educational outcomes and skills. Special attention is being given to the application of information and communications technology in teaching and learning.

To establish common values, improve employability, develop principles and objectives of all forms of vocational education and training (VET), a national VET curriculum is being developed. Its guiding principles are:

• flexibility of vocational education through electivity and modularity
• delaying vocational differentiation to the final grades to avoid prematurely directing students to specific occupations and to increase the flexibility of the future workforce
• ensuring the relevance of VET by respecting the standardised procedure provided by a survey of labour market needs
• providing general education and key competencies as a basis for further education and lifelong learning
• the gradual introduction of the work-based learning model in all forms and types of VET
• preparing and implementing a prediction model based on the analysis of needs, plans and trends in VET sectors at county, regional and national levels
• ensuring the transition from VET to various forms of higher education through additional educational programmes and by removing barriers and ‘dead ends’ in education

Training

The government institutions that have played an important role in the Croatian labour market and that are responsible for training regulation and development are the Ministry of Science and Education; the Ministry of Labour, Pension System, Family and Social Policy; and the HZZ.

The Ministry of Science and Education is responsible for the quality of the Croatian labour force and its training and skills. The reform of the Croatian educational system is still widely debated and many of the educational programmes that are still in place were designed a long time ago to meet now outdated needs. There is an urgent need to reform the educational and training system in Croatia.

The Ministry of Labour, Pension System, Family and Social Policy is in charge of regulating and governing labour relations, labour markets, relations with trade unions and employers, the policy of the pension insurance system and international cooperation in the field of labour and employment.

The HZZ is in charge of the process of mediation in the labour market, providing job placement services, counselling, and promoting the adaptability of enterprises facilitating redeployment and restructuring. The service also maintains passive and active labour market policies, facilitates new job creation by participating in local development initiatives and provides capacity support for international cooperation and reforming the labour market in Croatia.

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, sex, disability, nationality, race and religion.

In Croatia, discrimination is an unjustified and prohibited difference in treatment on the basis of certain characteristics listed in the Anti-discrimination Act (OG 85/08 and 112/12), such as race or ethnic origin, skin colour, sex, language or religion. Discriminatory treatment or forms of discrimination according to the Anti-discrimination Act include direct and indirect discrimination, harassment and sexual harassment. To constitute harassment, there needs to be a link between such treatment and one of the discrimination grounds listed in the act. For example, there is discrimination if someone is harassed at their workplace because they are an older person or female. The legislation is monitored and enforced by various institutions and an ombudsman system, which includes an Ombudsperson for Gender Equality (Pravobraniteljica za ravnopravnost spolova) (and a Disability Ombudsman (Pravobranitelj za osobe s invaliditetom).

Equal pay and gender pay gap

According to Eurostat data, the unadjusted gender pay gap in Croatia increased from 15.5% in 2010 to 17.6% in 2011 and to 18% in 2012. The unadjusted gender wage gap in Croatia is relatively high within the international context and is 1.2 percentage points higher than the EU27 average (16.8%). However, Nestić et al (2014) used EU Labour Force Survey data and concluded that the adjusted gender gap in Croatia had slightly decreased from 17.1% in 2004 to 16.9% in 2008 and to 15.9% in 2012. According to the project on the gender pay gap by the Center for Education, Counselling and Research (CESI, 2016), the gender gap is 9.8% (gross) and 9.6% (net). According to the World Bank (2019), men in Croatia earn much more than women. The average monthly pay for women accounts for around 88% of the average pay for men, and women who work earn less than men throughout their life. According to the Croatian Bureau of Statistics (2022a), the average monthly paid net salary per employee in legal entities of the Republic of Croatia for the third quarter of 2022 was HRK 7,888 (€1,047) for men and HRK 7,323 (€972) for women. Therefore, the gender pay gap is 7.2%. Compared with the same period of the previous year, the average net wages for men increased by 7.6%, while for women the increase was 7.4%.

Quota regulations

In 2014, the Law on Professional Rehabilitation and Employment of Disabled Persons (Zakon o profesionalnoj rehabilitaciji i zapošljavanju osoba s invaliditetom, OG 157/13 and 152/14) came into force, and it was slightly amended in 2018 (OG 39/18) and in 2020 (OG 32/20). In 2015, a quota for the employment of people with disabilities was implemented, setting a mandatory minimum proportion of employees with disabilities of 3% for employers in all sectors with 20 or more employees. According to Article 8(6) of the latest amendment in 2020 (OG 32/20), a newly established employer is not obliged to employ a quota of people with disabilities for the first 24 months from the date of registration in the relevant register, that is, the day of establishment according to a special regulation. There are also two important laws as regards the employment of people with disabilities: the Ordinance on Incentives for the Employment of Persons with Disabilities (Pravilnik o poticajima pri zapošljavanju osoba s invaliditetom, OG 75/18) and the Ordinance on Professional Rehabilitation and Centres for Professional Rehabilitation for Persons with Disabilities (Pravilnik o profesionalnoj rehabilitaciji i centrima za profesionalnu rehabilitaciju osoba s invaliditetom, OG 075/18).

Trade unions

• Union of Autonomous Trade Unions of Croatia (SSSH)
• Independent Trade Unions of Croatia (NHS)
• Association of Croatian Trade Unions (Matica)
• Railway Workers Trade Union of Croatia (SZH)
• Croatian Journalists’ Association (HND)
• Trade Union of Croatian Journalists (SNH)

Employers

• Croatian Employers’ Association (HUP)

Government

• Ministry of Labour, Pension System, Family and Social Policy
• Government of the Republic of Croatia

Public institutions

• Croatian Institute of Public Health – Department of Occupational Health (HZZZSR)
• Croatian Employment Service (HZZ)
• Croatian Pension Insurance Institute (HZMO)
• Central Registry of Affiliates (REGOS)
• Croatian Health Insurance Fund (HZZO)
• Department of Expertise, Professional Rehabilitation and Employment of Persons with Disabilities

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