New rules in Romanian employment: electronic signatures, teleworking updates and exemptions for micro-enterprises
Last week has been a prolific one for the Romanian Government on handling employment related matters since issuing two Government Emergency Ordinances on key labour topics, namely on (1) the use of electronic signatures in employment context, (2) teleworking and (3) micro-enterprises’ labour-related obligations.
These are currently in force and therefore bringing opportunities for employers to implement further flexibility when dealing with - previously more strict or bureaucratic - employment matters, like signing individual employment agreements (IEAs), enforcing teleworking etc.
Without intending to provide an exhaustive overview of the relevant changes, a few key points to consider include the following:
Use of electronic signatures in employment context
The Government Emergency Ordinance No. 36/2021 (GEO 36) – published in the Official Gazette of Romania on 6 May 2021 – comes to the aid of employers and employees alike, filling the legislative gap on the topic of electronic signatures specifically in employment context.
This change was brought about by the need to simplify HR related activities, to support teleworking (considering the massive increase of teleworkers - from approx. 50k in March 2020 to approx. 400k in March 2021) and to make more efficient and adapt employment relationships to the new realities (including to bring more flexibility, support the business environment during the economic crisis and secure the employee’s protection, including from a health and safety perspective).
While the COVID-19 pandemic has definitely been a driver for change, the Government also recognizes that the tendency to work remotely will be visible in many aspects of our lives going forward so this measure anticipates the need for digitalization as relevant on the long term.
What was the prior standing?
The question of whether and what types of electronic signatures may be used in employment context is on the minds of employers for quite some time now. The interest peaked during the COVID-19 context, especially during the state of emergency but also afterwards, when wet signing employment documentation often posed difficulties or required imaginative solutions (like signing in counterparts) to secure compliance with the Governmental measures imposed of remote work and social distancing.
While the EU eIDAS Regulation1 expressly confirms – for some years already – that a qualified electronic signature has the equivalent legal effect of a handwritten signature, it has been reluctantly used in employment context. This is partly due to the expectation of both employees and labour authorities of using / seeing wet signatures on employment documents and partly, perhaps, due to the lack of specific guidance to factor the particularities of employment relationships. The fact that employees only rarely owned qualified electronic signatures also likely played a key role.
In short: theoretically, qualified electronic signatures had their legal effects recognised when used on documents in general and could have been used, but, practically, wet signature was the preferred route (at least pre-pandemic).
The parties (employer and employee) may opt for using – as the case may be – an advanced electronic signature or a qualified electronic signature, with an electronic time stamp or qualified electronic time stamp and qualified electronic seal of the employer (Electronic Signature Options) for signing IEAs or addenda to IEAs. GEO 36 expressly confirms that this fulfils the legal requirement of having written form for IEAs. For clarity, the Electronic Signature Options are the ones defined under the EU eIDAS Regulation, not being new Romanian concepts.
Some key points to note:
- (individual) information & IEA content: the procedures relating to the use of Electronic Signature Options need to be communicated to the candidates before execution of the IEA (however, this obligation is deemed fulfilled once the IEA is signed). This information will now be part of the minimum content of the IEAs, therefore, enhancing visibility on it for employees;
- (collective) consultation: the employees are called to have a say on the employer using Electronic Signature Options. In this sense, the employer may use the Electronic Signature Options for executing all relevant employment documents relating to IEA conclusion, performance or termination, within the conditions provided in the internal regulations (therefore, with employee consultation) and/or the applicable collective labour bargaining agreement;
- qualified vs. advanced electronic signature: GEO 36 fully equivalates the legal effects of the advanced electronic signature with the ones of the qualified one. While this may have a positive effect in what regards the widespread adoption of electronic documents in an employment context, it remains to be seen what types of signatures (what specific products available on the market) will be considered as meeting the requirements provided by the EU eIDAS Regulation for advanced electronic signatures;
- public authorities: the employer may also use the Electronic Signature Options in its interactions with public institutions in what concerns documents for employment or health and safety purposes and it will provide them with such documents, upon their request;
- same type of signature for both parties: GEO 36 expressly confirms that upon execution of IEAs/ addenda or other documents issued in the performance of the IEA, the parties must use the same type of signature, either both use wet signature or both use the Electronic Signature Options;
- costs: the employer may cover the costs for acquiring the Electronic Signature Options, in view of fulfilling the legal obligations under GEO 36.
If interested in this further flexibility, the employers should explore whether the electronic signature products their representatives hold fulfil the legal requirements of the Electronic Signature Options, as well as the opportunity (including associated costs) for their employees using the Electronic Signature Options.
Teleworking minor updates
GEO 36 also brings about a few amends to the Teleworking Law No. 81/2018, mainly aimed at securing further flexibility on this front as well, especially considering the high use of teleworking as of the COVID-19 context. The changes are meant to ease the process of implementing teleworking for employers, especially when the teleworking location is difficult to identify beforehand and also taking into account the specifics of teleworking (in the sense that the activity is performed remotely and not in a workplace organized by the employer).
Some key points to note:
- teleworking duration: no longer expressly imposing one working day per month. The rationale seems to be that the employer should be encouraged to grant more than one teleworking day per month and, in practice, it may lead to granting more days in one given month while even none in others (obviously, when COVID-19 related restrictions no longer prioritize remote work);
- teleworking location: the location from where the employee is permitted to perform teleworking is no longer one of the mandatory elements to be expressly agreed in the IEA;
- employer health & safety obligations (H&S): it seems that the employer H&S trainings should focus more on risks related to equipment with visualizing screen rather than the actual working conditions at the teleworking location;
- confidentiality: the employee must observe and ensure the confidentiality of the information and documents used while teleworking.
The actual effects of the changes need to be further considered. For example, how the more relaxed H&S requirements translate in practice needs to be confirmed by H&S providers - if effectively entailing significant H&S changes, especially since, as a general rule, the employer still has the general obligation to ensure health and safety of its employees (irrespective of the workplace). For the other changes, the employers may freely consider whether amending the existing teleworking clauses to reflect them makes practical sense, for example, if intending to permit more freedom to employees in choosing their teleworking location(s), while considering the potential implications.
Exemptions for micro-enterprises
In line with its declared aim of eliminating bureaucracy within employment relationships, the Government has also approved the Government Emergency Ordinance No. 37/2021 (GEO 37) – also published in the Official Gazette of Romania on 6 May 2021 – amending the Labour Code by exempting micro-enterprises from certain employer-related obligations.
The following exemptions are now applicable to micro-enterprises:
- an exemption from putting in place a job description in written form as the employee’s attributions may be verbally communicated by the employer, unless the employee asks in writing that the written job description is communicated to him/ her. For clarity, the candidate still needs to be informed prior to employment on the job description, specifying the job duties;
- an exemption from implementing an internal regulation (with no specific alternative expressly provided by law for covering the respective provisions).
GEO 37 also regulates that daily working time records are kept by the employer under the conditions established by written agreement with the employees, depending on the specifics of their activity (same as for mobile or home working employees).
For clarity, micro-enterprises are defined by Law No. 346/2004 as having up to 9 employees and achieving a net annual turnover or holding total assets of up to EUR2 million (in RON equivalent).
Micro-enterprises should consider how to practically approach this enhanced flexibility while still retaining adequate employer tools to be able to address day-to-day employment issues (such as disciplinary investigations which may prove more difficult to sustain in lack of clear-cut job duties agreed in writing with the employee or performance evaluations, in the absence of a specific evaluation process, criteria and objectives agreed in the internal regulations, etc.). Also, in the light of newly enacted provisions above mandating employers to determine, among others, within the internal regulation - the conditions for using Electronic Signature Options, the opportunity of enforcing or not an internal regulation should be assessed by micro-enterprises.
1Regulation (EU) No 910/2014 of the European Parliament and of the Council of 23 July 2014 on electronic identification and trust services for electronic transactions in the internal market and repealing Directive 1999/93/EC.