Slovenia

Sources of regulation

A fundamental act regulating individual employment relationship is the Employment Relationships Act[1] (hereinafter referred to as ERA), which was adopted in 2002 and implemented on 1 January 2003.

In 1992, Slovenia has ratified the ILO Termination of Employment Convention, 1982 (No. 158).

Scope of legislation

ERA implements the unity of employment relationships, as it applies to all employed persons in the private, as well as in the public sector.

In 2002, the National Assembly of the Republic of Slovenia adopted the Civil Servants Act[2] (hereinafter referred to as CSA), which determines special features relating to employment relationships of civil servants employed at State authorities and local community administrative boards.[3] In relation to ERA, CSA is a special law for which the principle Lex specialis derogat legi generalis applies.

Special regulations on labour relations are also valid for certain professions, as there are e.g. soldiers according to the Defense Act[4] and policemen according to the Police Act.[5]

Contracts of employment

In the Republic of Slovenia, a person can obtain employee status based on different employment contracts. Aside from an employment contract concluded for an indefinite duration, which is determined as a rule after Employment Relations Act, labour relation can be concluded based on the following employment contracts:

• fixed-term employment contract,
• employment contract between the worker and the employer who carries out activity of providing workers to another user,
• part-time employment contract,
• employment contract for the provision of public works,
• employment contract on home work,
• employment contract with managerial staff.

Termination of employment

According to ERA, an employment contract is terminated:

• upon the expiration of the period for which it was agreed upon. This applies to employment contracts signed for a fixed length of time.
• upon the death of the worker or the employer (physical person). In cases in which the decedent˘s/employer˘s activity is uninterruptedly continued by his/her successor, the employment contract must not terminate.
• with a consensual cancellation. ERA determines two conditions, which must be fulfilled in such cases. The fist condition is that the agreement must be done in writing, whereas the second condition requires that such written agreement includes provisions about the consequences for the worker stating that due to such termination he/she cannot exercise the rights arising from the unemployment insurance.
• by an ordinary or extraordinary termination. A worker or an employer may terminate the employment contract by ordinary or extraordinary termination, what is explained in continuation.
• by a court judgment, where the court of justice itself or upon the worker˘s proposal may decide that the re-integration of the worker is not reasonable.
• by law in cases stipulated by ERA or other laws.

Dismissal

ERA divides the termination of the employment contract to ordinary and extraordinary termination that both may be initiated by the contractual parties.

Due to the fact that the worker is a weaker party in the contractual relationship and that the termination of the contract entails a loss of employment and earnings, ERA restricts the employers’ possibilities to terminate employee contracts by using numerous protective provisions. The protective provisions refer to the reasons and the proceedings of termination of the employment contract.

ERA determines three groups of reasons for the ordinary termination of the employment contract at the initiative of the employer:

• when there is a founded business reason,
• when there is a reason of incapacity,
• when there is a “fault” reason.

ERA especially determines unfounded reasons for ordinary termination. These are: absence from work due to illness or injury, parental leave or care for children or family members, membership or participation in trade unions, strikes, reasons relating to discrimination, etc.

Termination of Employment Contracts for Business Reasons

ERA determines individual and collective termination of the employment contract for business reasons.

In cases of individual termination of the employment contract for business reasons the need for the work carried out by the worker has ceased for: economic, organizational, technological, structural or similar reasons on the employer˘s part.

Collective dismissals entail cases in which the employer terminates employment contracts to a larger number of workers for business reasons if their work is to become redundant within the period of 30 days. ERA determines what is considered to be a larger number of workers relative to the size of the enterprise.

The employer must elaborate the redundancy programme for workers that have become or will become superfluous. The contents of the aforementioned programme are determined in Article 99 of ERA. It must contain the following:

• reasons for the redundancies;
• measures to prevent or limit to the highest degree the possible termination of workers˘ employment relationships, whereby the employer must consider the possibility of continuing the employment under modified conditions;
• list of redundant workers;
• measures and criteria for the selection of the means to mitigate harmful consequences of the termination of the employment relationships, such as: offering jobs with another employer, assuring financial assistance, assuring assistance to start an independent activity, purchasing insurance period, etc.

Termination of Employment Contracts for Reasons of Worker’s Incapacity

The reason of incapacity means that:

• the worker does not achieve the expected work results (a subjective reason) or
• the worker does not meet the requirements to carry out work (an objective reason).

ERA determines that the reasons for not achieving the expected work results entail that the worker does not carry out work:

• in due time;
• professionally; and
• with due quality.

Thus, the incapacity of the worker is either subjective, as he/she is not capable to carry out work with due quality, in due time or professionally, or there are objective reasons which follow from the changed requirements to carry out work and are determined in regulations (but not in autonomous acts, the collective contract or general acts of the employer), and consequently the worker is no longer capable to carry out work as agreed by the employment contract.

Dismissal for reason of incapacity, if opposed by the trade union, with regards to the reason or procedure of termination, gives the worker the right to require a suspension of the termination of the employment contract.

Dismissal for “fault”

The third group of ordinary termination of employment contract at the initiative of the employer represents cases, when the worker violates contractual or other obligations. These are the cases of worker’s guilty conduct resulting in the “fault” reason for termination.

Extraordinary Termination

Reasons for extraordinary termination may emerge from both the side of the worker and the employer. In certain cases, where one of the parties severely violates the rights of the other to an extent that their relationship is damaged and thus the employment relationship cannot continue, either one of the parties may terminate the contract without prior notice. In order for the extraordinary termination to be in accordance with the law, reasons, which are exhaustively listed in ERA, must exist. In addition to the existence of one of the statutorily determined reasons, the party at whose initiative the employment contract is terminated must determine the existence of reasons that, by taking into account all circumstances and interests of both contractual parties, it is no longer possible to continue the employment relationship to the expiration of the notice of termination. If both aforementioned reasons are met, the contractual party must deliver the termination no later than, and within 15 days of learning the reason(s) which justify the extraordinary termination (a subjective period of notice) and no later than, and within six months of the occurrence of said reason(s) (an objective period of notice). In cases regarding conduct that includes elements of a criminal offence, this period of notice is extended for the entire time during which criminal prosecution is conducted.

Proceedings of extraordinary termination at the initiative of the employer are the same as regular termination for breach/violation of contract reasons. (Written accusation, information to the trade union, and if the employee so demands, a possibility of postponing the termination of the employment contract).

The employee does not have the right to severance/unemployment allowance or financial subsidy during his or her unemployment; but, he or she has the right to immediate judicial protection or protection by arbitration.

Notice and procedural safeguards

Prior to the termination of the employment contract for business reasons and reason of incapacity, the employer must verify the possibility of preservation of the worker's employment, qualification and change of qualification if applicable. If possible, the employer who terminates the employment contract should simultaneously offer new employment to the worker.

The employer must serve the worker with a reason for termination, in writing, and in the case of a “fault” reason, must invite the employee to present his/her defence. At the request of the worker who is part of a trade union, the employer is also required to notify said union in writing. In cases of collective dismissals, the employer has to consult with the trade union and inform the employment agency, to search for new jobs for the terminated employees.

If the trade union does not give any opinion within eight days, it is considered that it does not oppose the termination; however, the trade union may oppose the termination if it deems that the reason for the termination is not fulfilled and if the union considers that the rules of proceedings were violated. In the event the union disagrees with the termination clauses submitted by the employer, the union must file all objections in written form and the topic(s) in question will have to be discussed by both parties. If the union acknowledges the employer’s given reasons to terminate the employee, a postponement of termination may be requested by the worker.  Termination does not take effect until judicial ruling or arbitration has taken due course. If the employee is not a member of the trade union, he or she cannot ask for a postponing of the effect of termination of the employment contract, but he or she may inform the labour inspectorate. The labour inspector may postpone the effect of termination of the employment contract, if the employer was considered to have acted arbitrarily, and as well as to prevent irreparable damage.

In the time of postponing of termination, a worker remains in the employment relation until a ruling by a court of justice or an arbitration has been reached. During this time, the employer may prevent the employee to carry out work, but must pay a subsidy in lieu of the salary (50% of the employee’s average salary in the last three months prior to termination).

Providing proof that a founded reason for termination exists, that the reason is so serious that further work is impossible and that there is no possibility to preserve the employee's position, is the employer’s responsibility.

The employer must provide written explanation to the employee where a violation of contract exists, specifically in cases where repeat offenses are likely. It is an obligatory preliminary proceeding and the employee cannot be dismissed without a warning that he or she is violating contractual or other obligations. Only in the case of a second violation (not a violation, for which the employer already warned the employee) can the employer terminate the employment contract.

An employee, whose employment contract was terminated, has the right to a given time of notice; for business reasons, from 30 to 150 days, for reason of incapacity, from 30 to 120 days. The duration of the given time of notice is dependent on the employee’s tenure with the same employer. In cases of breach/violation of contract (“fault” reasons), there is a unique given time of notice of 30 days.

Severance pay

An employee, whose employment contract was terminated for a business reason and/or reason of incapacity, is entitled to severance pay borne by the employer. The amount depends on the employee’s tenure with the employer. The maximum severance pay is 1/3 of the employee’s average monthly salary in the last three months for each year of work at the employer, if employed by the same employer for more than 15 years, or lower than 1/5 of the same base, if employed more than five years.

An employee is also entitled to unemployment allowance during the time of unemployment for a maximum of two years, depending on the working time of the employee. The amount of the unemployment allowance for the first three months of unemployment is 70% of the employee’s average monthly salary received within twelve months before the date of termination of employment; and 60% of the same base for the months thereafter. The employee is not entitled to severance or unemployment pay in the case of dismissal for “fault”.

Avenues for redress

Employees may contest termination of their employment at the court of justice or arbitration within 30 days of notification. An individual conflict can be solved by the labour court of justice or a fix or ad hoc arbitration, if it is provided in the collective agreement and if the employee and the employer agree on the solution of the conflict by arbitration; however, the settlement of individual labour conflicts by arbitration has yet to be established in Slovenia. In the Republic of Slovenia most of conflicts at the labour court of justice are related to termination of employment contracts. Employees challenge the legality of termination either due to irregularities in proceedings or lack of/inexistent reasons for termination.

Establishment of the illegality of termination and the return to work notwithstanding, an employee may demand compensation from the employer, if he or she proves that elements of liability resulted in the illegal termination. Based on the proposal by the employee or ex officio, the court of justice also might decide that the duration of the employment relation shall last till the decision by the court of justice in the first degree and acknowledge the employee's working period and other rights from the employment relation including compensation. The Employment Relations Act specifically determines that the employer is liable for any inconvenience caused to the employee as the result of the violation of rights of the employment relation, including illegal dismissals.

Further information

• ILO Natlex Slovenia

[1] Employment Relations Act, Official Gazette RS, no. 42/2006.

[2] Civil Servants Act, Official Gazette RS, No. 35/2005 - official consolidated text.

[3] Civil servants are individuals employed in the public sector. Functionaries in State authorities are not deemed civil servants, whereas officials that perform public tasks and exact ancillary work in state authorities and local community authorities are to be deemed civil servants. Civil servants performing other ancillary work in the aforementioned authorities are professional-technical civil servants (paragraphs 1 and 4 of Article 1, paragraph 1 of Article 23 of CSA).

[4] Defense Act, Uradni list (Official Gazette) RS, no. 82/94 and 67/2002.

[5] Police Act, Uradni list RS, no. 49/98.