Romania: Latest working life developments Q3 2018

Proposed changes to the pensions system, the positive impact of holiday vouchers, compensation for workers affected by the African swine flu outbreak and trade union protests are the main topics of interest in this article. This country update reports on the latest developments in working life in Romania in the third quarter of 2018.

Trade unions object to proposed pension changes

Recent studies on the Romanian labour market reveal that employment prospects for people looking for a job are 6% higher than last year. They also have greater bargaining power, given the current labour market tension and the intention of companies to increase staff numbers. ^[1]

In August 2018, the Ministry of Labour and Social Justice launched a public debate on the draft of a new pension law. According to the law, pension payments will be based on contributions, seniority, equality, social solidarity and other principles. Newly proposed provisions include the following:

• Periods spent studying for MAs and PhDs will no longer be considered contribution periods.
• Transparency will increase and it will be easier for people to access their personal information.
• The retirement age for women with at least three children will be reduced.
• A minimum social allowance option will be introduced.

Trade union representatives objected to what they saw as discrimination against women, who will receive a lower pension than men. They also pointed out that the pension issue is separate from economic evolution and will not grow as fast as the average salary, resulting in a pensions freeze in the medium term. Finally, they said that most employees (65%) would receive the minimum pension in the future (60% of the minimum wage).

The representatives called for the Tripartite National Council for Social Dialogue to be convened, so that the draft law could be discussed further.

• Ministry of Labour and Social Justice: Public debate on the draft pension bill

Greater access to EU funds for employer organisations

Employer organisations and other similar organisations will be able to access EU funds in order to finance professional training courses for their employees. The funds – consisting of about €90 million – will be accessible through the Romanian Operational Programme ‘Human Capital’.

Holiday vouchers boost domestic tourism

The National Association of Travel Agencies (ANAT) reported that holiday vouchers granted by companies as a benefit in kind to employees boosted demand for domestic tourist destinations in the summer of 2018. The value of the vouchers issued in the first eight months of this year amounted to over €223 million, 7.7 times more than in 2017. The vouchers are expected to continue to be available next year. ^[2]

Government compensates agricultural workers

An outbreak of African swine flu in Romania has led to the closure of a large number of pig farms and caused many employees to lose their jobs. In response, the government has approved monthly compensation of RON 500 (€107 as at 14 November 2018) for all agricultural workers affected by the collective redundancies. The compensation is granted for six months, in addition to unemployment benefits, to workers that meet the minimum requirements.

• Ministry of Labour and Social Justice: Compensations in case of African swine fever

Trade union protests in youth, sport and transport

In July and August, employees from units under the control of the Ministry of Youth and Sport held protests over fair pay. They argued that 70% of employees in this field have net monthly salaries of RON 1300 (€279 as at 14 November 2018), the lowest in the budgetary sector. Demands made by representatives of the National Sport and Youth Union (SNTS) included:

• equalising salaries to the maximum level of payment
• payment for work and overtime on Saturdays, Sundays and public holidays
• granting bonuses
• supplementing the number of employees
• unlocking vacancies
• extending the collective labour contract

Following negotiations, ministry officials announced that employees would receive a salary increase from1 January 2019, and bonuses would be granted for working in potentially hazardous conditions.^[3]

Discussions between representatives of the Federation of Romanian Railway Trade Unions (FSTFR) and the Ministry of Labour and Social Justice regarding a railway personnel statute continued in the third quarter of 2018. The draft of a normative act is currently under discussion in parliament, but trade unions are dissatisfied with how long the process is taking given that employees are overworked and have a high average age (49 years), and there are no investments in the sector. Ministry representatives will share their point of view after analysing the financial impact of the unions’ demands on the budget of the national Pension House.^[4]

Metro trade unionists protested in front of the Ministry of Transport over disagreements with METROREX's management board about personnel shortages, traffic and passenger safety, renting commercial space, and negotiation of the collective labour agreement. ^[5] Discussions between the trade union, the ministry and METROREX’s management are ongoing.

Romania ranks No. 2 for staff shortages

A recent study ranks Romania second in the world in terms of staff shortages, with over 80% of employers saying they find it difficult to recruit qualified staff. ^[6] In order to reduce the workforce shortage and accelerate the inclusion of disadvantaged social groups into the labour market, monthly subsidies for employers that hire young graduates, unemployed people or socially marginalised young people will increase by 150%, reaching RON 2,250 (€482 as at 15 November 2018).