The employment relationship

Country specific laws

What laws and regulations govern the employment relationship?

The main source of employment law is the Employment Relationships Act (ERA-1). The ERA-1 is harmonised with EU legislation and incorporates all applicable and binding international conventions, EU directives and regulations. Trade union activity, collective agreements and many other aspects of employment law, as well as special categories of worker, are governed by special regulations.

A significant autonomous source of law is collective agreements. Collective agreements are usually concluded for a specific activity or occupation but may also be concluded by individual employers. While the ERA-1 defines certain rights, their scope is determined by collective agreements, which are particularly important when determining the starting salaries in individual tariff classes, since trade unions and employers are engaged in constant dialogue on this issue. Notably, the rights and obligations of parties to an employment relationship in collective agreements and internal regulations can be stipulated differently or more favourably than those presented herein.

Who do these cover, including categories of worker?

The ERA-1 applies to employment relationships between:

  • employers with a registered office or residence in Slovenia and their employees; and
  • foreign employers (without a registered office or residence in Slovenia) and their employees if the employment contract was concluded in Slovenia.

In order to be classified as a worker and therefore be entitled to statutory employment rights, an employment contract must have been concluded. Further, workers must:

  • be subordinate to their employer;
  • perform work according to their employer's instructions and supervision; and
  • perform work personally and continuously in return for payment.

The ERA-1 sets out a special category (so-called ‘economic dependants’) for self-employed persons who perform work personally under a civil law contract in return for payment for an extended period. An economic dependant cannot employ another person and must be economically dependent on one client. Economic dependants must earn at least 80% of their income from the same client. Economic dependants enjoy limited protection under the labour law.

In the case of employees posted to Slovenia by a foreign employer based on a foreign law contract, the ERA-1 applies in accordance with the provisions regulating the position of employees posted to work in Slovenia. This means that the posted employees perform work in Slovenia under the conditions laid down in the regulations on the work and employment of foreign citizens. Foreign employers must ensure that employees posted to Slovenia enjoy the rights set out under Slovenian law and the relevant collective agreement regarding working time, breaks and rest periods, night work, minimum annual leave, salary, health and safety at work, the special protection of employees and equal treatment, if these are more favourable for the employee.

Misclassification

Are there specific rules regarding employee/contractor classification?

An individual can perform work as:

  • an employee in an employment relationship;
  • a solo trader;
  • a self-employed person; or
  • an economic dependant.

Only an employee is fully entitled to statutory employment rights.

A solo trader (ie, a natural person who performs an activity in the market within the scope of an organised company) is liable to self-employment income tax and social security contributions.

A solo trader has no statutory employment rights. The same position is for self-employed persons.

An economic dependant enjoys limited protection under the labour law regarding:

  • discrimination;
  • minimum periods of notice;
  • termination of employment contracts for unjust reasons;
  • payment for work completed; and
  • liability for damages.

An economic dependant is liable to pay self-employment income tax and social security contributions.

Contracts

Must an employment contract be in writing?

Employment relationships must be stipulated in an employment contract, which must be concluded in writing. An employment contract will be deemed legal and valid when it is signed by the employee and employer. The employer must provide the worker with a draft written employment contract at least three days prior to the envisaged signing of the contract and with a written employment contract on its conclusion.

While employment contracts must be in writing pursuant to the ERA-1, according to the law and case law, a relationship between an employee and employer that has all of the elements of an employment relationship will also deemed an employment relationship and can be implemented as such even if the employment contract is not in writing. In such a case, the employee can request that their employer provide them with an employment contract at any time during the employment relationship. In the event of a dispute concerning the existence of an employment relationship, it is presumed that the employment relationship exists if all elements therein exist.

Are any terms implied into employment contracts?

The ERA-1 stipulates the elements that must be included in the employment contract. If the parties do not specifically stipulate the following in the contract, the law will automatically imply its own statutory provisions to the employment relationship:

  • the length and distribution of daily or weekly working hours;
  • provisions on other payments or salary components, the payment period and the date and method of salary payment;
  • provisions on annual leave; and
  • notice period.

Are mandatory arbitration/dispute resolution agreements enforceable?

In accordance with the ERA-1, the employer and employee may agree on dispute settlement through mediation. If the mediation is not completed successfully in the stipulated period, the employee may enforce judicial protection before the labour court.

Further, a collective agreement may stipulate arbitration as a means for settlement of individual labour disputes. If the arbitration tribunal does not reach a decision in the stipulated timeframe, the employee may request judicial protection before the labour court.

How can employers make changes to existing employment agreements?

If both parties are willing, they can always agree to amend the employment contract or a specific provision thereof. An amendment to the employment contract or the conclusion of a new employment contract can be proposed by either party.

Amendments can be made as an annex to the original employment contract. If the amendment concerns a change of position, place of work, the duration of the employment contract or weekly working hours, the employee and employer must conclude a new employment contract.

Amendments are prohibited if either party disagrees to the change.

Foreign workers

Is a distinction drawn between local and foreign workers?

Foreign workers are regulated by the Employment, Self-employment and Work of Foreigners Act. The act introduces a single permit for work and residence, which allows individuals from third countries to enter, reside and work in Slovenia. Permits are issued by the Administrative Unit Office, with the consent of the Employment Service of Slovenia.

EU member state citizens and citizens of Norway, Liechtenstein, Iceland and the Swiss Confederation can freely access the Slovenian labour market. This means that they can be employed, self-employed or perform work without the consent of the Employment Service of Slovenia.

Foreign nationals who are employed in Slovenia have the same working rights and obligations as Slovenian citizens. If a foreign national is employed based on a single permit, they have all of the rights and obligations in accordance with national law relating to wages, working time, breaks, rest periods and safety at work, among other rights.