Challenges of Teleworking – The Legal Perspective
The pandemic has forced the adoption of new ways of working and has brought unprecedented challenges and changes to our professional lives. Many companies have migrated to a world of work that even the most accurate legislation has never envisioned.
The massive and rapid adoption of telework early in 2020 in response to the COVID-19 lockdowns exposed gaps in the legislation governing telework arrangements across the EU Member States. Now that the pandemic is receding and wholesale telework seems to be here to stay, governments are faced with the need to properly regulate such arrangements.
In Romania, existing laws have been revised, policies have been developed and regulations have been adapted to keep pace with the most challenging aspects of working in the new normal, teleworking and WFA – work-from-anywhere.
According to the Romanian legislation, work-from-anywhere (WFA) can be implemented in one of the following forms: work from home (WFH), regulated by the Romanian Labour Code, or teleworking, which is governed by both the provisions of the Labour Code and those of Law no. 81/2018, the special law dedicated to teleworking. The provisions concerning teleworking must be completed with those which regulate work from home.
During the last two years, we have seen a series of legislative amendments aimed at facilitating remote work and in particular teleworking. Also, a growing tendency in using work-from-anywhere has been manifest, which brings more challenges in what concerns the legal requirements which should be observed in case of cross-border arrangements.
Legislative amendments facilitating remote work
The flexibilization of teleworking
Teleworking has been made more flexible, namely by removing the condition according to which teleworking shall be carried out at least one day a month, and by removing the condition according to which it shall be specified, within the individual labour agreement/within the addendum, the agreed place/places for teleworking.
In such contexts, employees who perform teleworking shall be considered teleworkers irrespective of the fact that they do not perform teleworking at least one day a month, and the individual labour agreement/the addendum must not include any mentions regarding the places from which teleworking is provided.
Use of electronic signature
The electronic signature can be used now in relation to any documents pertaining to the employment relationships, e.g., hiring offer, individual employment agreement, addenda thereto, correspondence, internal regulation, documentation related to the disciplinary investigation procedure/procedure of assessment of professional unfitness.
Employers have the obligation to inform the employee in relation to the procedures for the use of the electronic signature prior to the conclusion of the Individual Employment Agreement. Such an obligation is also a mandatory mention in the Individual Employment Agreement.
The employer may bear the costs for the procurement of the electronic advanced/qualified signature, but the candidate selected for recruitment/ the employees cannot be obliged to use the electronic advanced or qualified signature.
Within the same document, both the employer and the employee should use the same form of signature (either handwritten or electronic).
The conditions of use of the electronic signature should be established under the internal regulation or the collective bargaining agreement, if in place.
Reimbursement by the employer of the costs related to teleworking
According to the legal provisions, in case of teleworking, the individual employment agreement should provide the conditions in which the employer bears the costs related to teleworking.
Starting with the 1st of January 2021, amounts borne by the employer for supporting the costs representing the utilities (electricity, heating, water, and internet) and the costs with the office equipment and furniture represent a non-taxable income within the limit of maximum RON 400/month, depending on the number of days of teleworking. The exact limits should be established according to the individual employment agreement or the internal regulation, being however recommendable to include such limits in the internal regulation to avoid the necessity of amending the individual employment agreement in case of a change.
As this represents a maximum, in hybrid systems involving teleworking and work from the office, the concrete amount granted to the employees should be established, by observing a proportionality with the number of days in teleworking regime.
According to the legal provisions, the Romanian Labour Code applies to: (i) Romanian citizens performing work in Romania; (ii) Foreign citizens or stateless persons employed by a Romanian employer who work in the Romanian territory; (iii) Romanian citizens, employed by a Romanian employer who work abroad, if the relevant foreign legislation is not more favourable.
In addition to these rules established by the Romanian labour Code, it should be considered that EC Regulation no. 593/2008 (the EC Rome I Regulation) provides the freedom to choose the law applicable to the individual employment agreement. However, the choice of such law cannot deprive the employee of the protection granted by the mandatory provisions of: (a) the law of the country from which the employee usually carries out his activity OR (b) the law of the country where the employer is located, if the law under point (a) cannot be determined. If the contract is more closely connected with another country, the law of this country shall apply.
For employees working remotely from other jurisdictions, employers should pay attention to the rules stipulated under the Posted Workers Directive 96/71/EC. Irrespective of the law applicable to the employment relationship, employees should benefit from the employment conditions from the member state where the work is carried out as regards the following aspects:
- Maximum work periods and minimum rest periods, minimum paid annual leave;
- Minimum remuneration, as established by the foreign relevant legislation and/or practice, including overtime rates;
- The supply of workers by temporary employment undertakings;
- Health and safety at work;
- Protective measures for pregnant women/women who have recently given birth, children and young people;
- Equality between men and women, other provisions on non-discrimination;
- The conditions regarding the compensation/reimbursement of the costs related to transport, accommodation and meal for employees traveling to/from their usual working place, according to legislation or the collective bargaining agreement with general applicability in the foreign state.
The duration of the work performed abroad does not change these rules. Even if it is a temporary arrangement (a few weeks or months), the same legal regime shall be applicable as regards the level of the rights related to the employment conditions.
Also, these rules are applicable irrespective of the fact that the WFA is implemented through teleworking or working from home.
Let’s take some examples:
A: A Romanian employee works in teleworking regime from another EU member state for a Romanian employer.
The provisions of the Romanian legislation will apply to the individual employment agreement if the foreign law is not more favourable. Also, irrespective of the law applicable to the contract, the minimum standards imposed by the EU member state legislation as regards the employment conditions from the member state where the work is carried out should be observed by the Romanian employer. Thus, if certain aspects regulated in the country where the employee carries out their activity are more favourable to the employee, the legal provisions regarding such aspects should be considered. For example, if a salary increase of 100% of the gross base salary is granted in case of overtime by the foreign legislation (higher than the salary increase of 75% regulated by the Romanian Labour Code) or a higher number of holidays is regulated by the foreign legislation, this legislation will be applicable.
If the activity is carried out for less than 183 days in the EU member state, all tax and contributions shall be paid in Romania, provided that the a1 form is obtained at the start of the activity.
B: A Romanian employee works remotely from Romania for an employer in a Member State of the European Union.
Since the work is carried out in Romania, by a Romanian citizen, Romanian legislation is applicable. This is allowed by the CE Rome I Regulation and imposed by the Romanian Labour Code, but the provisions of the legislation of the state where the employer is located should also be considered, as such provisions may regulate specific rights and obligations.
C: A non-EU citizen works in teleworking for a Romanian employer.
In such case, the international relevant treaties governing the relations between Romania and the relevant state should be taken into consideration. For example, in what concerns pensions, the Bilateral Treaty between Romania and the Republic of Moldavia in the social security field provides that persons hired in the territory of one of the states, party to the Treaty, are governed by the provisions of the legislation of that party, in what concerns aspects related to the social security field. This rule applies irrespective of the fact whether the employee or the employer has the domicile/headquarters in the territory of the other contracting party. Thus, in case of a Moldavian employee working in teleworking in Moldavia to the benefit of a Romanian employer, the Moldavian law will be applicable in what concerns such aspects.
The legislative framework in Romania is constantly evolving to facilitate WFA and teleworking, as one of the forms in which WFA can be put in place. At the same time, the complexity of the practical situations which can appear in case of cross-border arrangements for both teleworking and work from home require a careful and tailored analysis of each case, to determine the relevant legislation applicable and the legal implications to be considered.
*This article was initially published in the ABSL Annual Report 2021 and has been updated according to the latest legal amendments.