Hiring Employees in Romania: A Practical Guide for Employers

Taking on your first employee in Romania is a significant step. The process is governed by the Labour Code and related regulations, which apply equally to local and foreign-owned companies. While many tasks can be handled by an accountant or HR specialist, understanding the basics will help you stay compliant and build a smooth working relationship.

Employment Contracts

Every employment relationship must be based on a written individual employment contract. The contract must be concluded before the employee starts work, and a copy must be given to the employee. It should include essential elements such as the job description, workplace, salary, working hours, holiday entitlement, and notice period. For most roles, a probation period of up to 90 calendar days is permitted; for management positions, it can be up to 120 days. The contract must be drawn up in Romanian, but it may also be provided in a language the employee understands.

Registering the Employment Relationship

Before the employee's first day, the employer must register the employment contract in the General Register of Employees, known as REVISAL. This electronic register is managed by the labour authorities and must be updated whenever an employment relationship starts, changes, or ends. Registration is done online, usually by the employer or an authorised representative, and must be completed at least one day before the employee begins work. Failure to register correctly can lead to fines.

Working Time and Leave

The standard working time in Romania is eight hours per day and 40 hours per week, typically spread over five days. Overtime is allowed in exceptional circumstances and must be compensated with paid time off or, in some cases, a salary supplement. Employees are entitled to at least 20 working days of paid annual leave each year, in addition to public holidays. Employers must keep accurate records of hours worked and leave taken.

Social Contributions and Payroll

Both employers and employees contribute to the state social insurance system, which covers pensions, health insurance, and unemployment. The employer is responsible for withholding the employee's share and paying both parts to the tax authorities each month. Payroll must be processed using approved software or by an accountant, and monthly declarations must be submitted electronically. Salaries are usually paid in Romanian lei, at least once a month, on a date specified in the employment contract or collective agreement.

Termination of Employment

An employment contract can end by mutual agreement, by resignation with notice, or by dismissal. Dismissal is only permitted for specific reasons set out in the Labour Code, such as serious or repeated misconduct, incompetence, or redundancy when the position is eliminated. Notice periods vary, typically 20 working days for employees and 20 working days for management. In cases of redundancy, employees may be entitled to severance pay. Always follow the correct procedure and document every step to avoid disputes.

Health and Safety and Other Obligations

Employers must provide a safe working environment, conduct a risk assessment for each job, and ensure employees receive appropriate training. A medical examination is required before an employee starts work, and periodic check-ups may be necessary depending on the role. Employers must also keep a personnel file for each employee, containing the contract, job description, and other relevant documents. Non-compliance with health and safety rules can result in serious consequences, so it is wise to seek professional advice.

Hiring in Romania is straightforward when you understand the rules. While this guide covers the essentials, employment law is detailed and subject to change, so always consult a local HR expert or lawyer before making key decisions.