Towards new employment regulation in Croatia

Dubravka Glavas (left) Djurdjica Svigac (right) Photo:Davor Javorovic/Pixsell

Dubravka Glavas (left) Djurdjica Svigac (right) Photo:Davor Javorovic/Pixsell

Hrvoje Vidan of Vidan Attorneys At Law captures in his article a good summary of issues contemplated and considered under upcoming legislative changes in Croatia:

The lack of structural reforms, amongst others within the labour market, resulted in the recent crash of the Croatian credit rating. Yet, since February 2012, under the leadership of Prime Minister, Mr. Zoran Milanovic the Croatian Government has been considering the modification of the employment law with a purpose to ease the investments and provide more flexible “hiring” and “firing” regulation. The changes are expected to be enacted soon, until the first half-year.  

Historical overview

The first Employment Act in Croatia after its independence was adopted in 1995 and for that time it established a modern employment system. The changes of the Employment Act that followed did not respond the situation on the labour market. The most extensive changes to the Employment Act in 2009 were related to the European workers’ participation, which changes did not significantly affect the labour relations in Croatia. Yet, these changes also included the amendments on working time regulations which to great extent restricted the possibility of overtime work, redistribution of working hours and thus even prevented the employers in further developing of business. The current Minister of Labour and Pension System, Mr. Mirando Mrsic announced the comprehensive changes to the employment law which would be sent into the Government procedure soon…READ THE FULL ARTICLE HERE ON LEXOLOGY WEBSITE

In the upcoming time we will inevitably be witnessing the changes to the Croatian employment law, which have been recently thoroughly and systematically discussed in the general public but also between the employment experts. The recent downgrade of Croatia suggests that the changes should tend to ease dosing business and inevitably liberate procedure of hiring and firing the employees. What kind of changes are to be adopted and to which extent remains yet to be seen“, concludes Vidan in his article.

It’s about time serious and business invigorating employment changes hit the streets of Croatia. The rags still dragging along from the inflexible system inherited from former Yugoslavia have long passed their use by date, especially in the modern free and competitive markets. Hopefully the new laws will spread good news far and wide and attract the badly needed investment and business development that will lead to sizable reduction of unemployment.

As of January 2013 there were 372,003 unemployed people in Croatia, and this figure has been rising consistently, currently making it between 21 and 22% of registered unemployment.

Out of this figure (sourced from Croatian Employment Office 14 February 2013):

Women: 195.435
Without any working experience: 62.031
Up to 24 year olds: 73.390
Those younger than 24 without any working experience: 35.737
Long term unemployed: 155.864

How much of this appalling state of affairs, which leads or has already led to disturbing levels of poverty or dangling at the border of poverty, is due to archaic employment laws that provide little if any incentive to business entrepreneurship, how much is due to the corruption with and theft of national assets through privatisation in Croatia, how much of it is due to weakening economies and markets, it’s difficult to assess. However, one thing is definite: changes in employment laws are needed “yesterday”.

Altruism and humanity often surface in times of despair caused by unemployment and threat of poverty. A heartwarming story has gripped the Croatian public in the last two days when it came to light that a single woman, Dubravka Glavas, gave up her own job in Vinkovci in favour of her co-worker Djurdjica Svigac, a struggling single mother with two children. Vecernji List reports that when Dubravka heard that Djurdica and two other women were to lose their jobs due to the needs for cutbacks, she approached the company director and asked that she, instead of Djurdica be the one to lose the job. After his initial shock and surprise the director checked whether such a move would be legally possible and finally agreed to Dubravka’s request. What an amazing gift. Dubravka is a heroine in my book; humbly she said: “I’m still young, I’m single and I can find a new job, hopefully, more easily than a woman with two children”. God bless you, Dubravka.     Ina Vukic, Prof. (Zgb); B.A., M.A.Ps. (Syd)


  1. Businesses are going bust everywhere, those that cling on cannot pay their bills, an action which brings down their suppliers who then give up (or work on the black market)…. a vicious circle. People here work, on average, 50-55 hours per week, they cannot choose their annual holiday time, the unions are either powerless or are dominated by interests other than their members’. Average salary is between 2,600 – 3,500 kune (which is significantly less than any poverty line) although the insurance and taxes means that employers must pay double that for each employee. In short, the businesses are broke and the workers, if they get paid at all, get peanuts. It’s a mess and getting worse. We are competing with China, Indonesia, Vietnam and India where near slavery conditions keep prices low. People hope the EU will help but I don’t see how. We have screwed it up and it’s difficult to see how we can get out of it.

    • Yes Pavao, it seems that only a miracle can delivery the people from the ever threatening and widening poverty. Perhaps a stronger hand, determination and orientation into greater self-sufficiency, especially in food production and supply could bring relief. Croatian development bank has done such a terrible job in the past 20 years and yet so much money was available to channel into proper economic reconstruction and prosperity. It’s a given that many countries are in the gutter like Croatia when it comes to unemployment and poverty but Croatia is still slightly ahead of most – so why let it get worse? Pressure on politicians is certainly one way of going about change.

    • Vladimir O5sag says:

      It is nothing surprising Pavao. One of your sabornik stated recently that Croatian people should read more, instead of watching sapunice. If you read George Orwell’s 1984 (in reverse 1948) the whole situation in Croatia would make sense. You need to read PM magazine (Germany), which will tell you why those things happen in your country. It started in 1948 in the Balkans, but it started in Germany in 1776. That is one of the main reasons why I have difficulty to publish my modern historical novel, The Balkans Conspiracy. Your hope,that EU shall solve your problems is a wishful thinking, which prove how naive we are.

  2. Michael Silovic says:

    This is an excellent article Ina. What the article points out most importantly is that the Croatian people care about one another and are willing to make sacrifices for their neighbors, friends and loved ones. It proves that Croatians are loyal to one another in time of needs and how compassionate many are in their daily lives. Very few countries or peoples can say this as most of the world is feed upon nothing more then greed. now to address the unemployment issues I am glad that their are changes in the employment laws coming. far to often people work and do not get paid and this must end. Workers need to be paid accordingly and with benefits if we are to keep our young people in Croatia before we see a drop in our population. What is sad to me however is the fact the the unemployment rate is staggering because of a lack of vision by our goverment and it’s lack of support for our farming community. As I mentioned before in comments I posted Croatia imported 10 billion dollars of imports in farming subsides. I also stated many times that farming and manufacturing is the economic engine of any country and we have failed to support either one of those. If our goverment would have supported farming and farmers this would have created many good jobs for people not only in the fields but in a way of manufacturing products for packaging and distribution etc. Farming is the backbone of many industries.I still do not understand why our goverment chose to ignore this. The future for Croatia is in medicine and medical technology and I hope that Croatia moves to the fore front of this development and technology.

    • Good one Michael. It seems that Croatian farmers are still doing it tough and let’s trust this will change.

    • Vladimir O5sag says:

      The plan is to destroy Croatian farmers so that Croatian people buy their milk from Austria. Once in EU it will be EU parliament making decision what Croatia will do.

  3. Since its declaration of independence in 1991, which precipitated the dissolution of Yugoslavia, Croatia has had a difficult path transitioning to a market economy. Now, Croatia is set to become the newest member of the European Union in July 2013, provided its accession treaty is ratified by the other 27 member countries. As part of Yugoslavia prior to 1991, about three-quarters of Croatia’s labor force was employed in the public sector, largely employed by state-controlled enterprises. Private sector employment accounted for only about thirteen percent of the working population in 1990. Although public sector employers employ fewer Croatians today, the number is still high, and Croatia still struggles with rigid and uncompetitive regulations and the cost of a very generous social welfare system.

    Croatia is a unitary democratic parliamentary republic of approximately 4.3 million people. Despite the challenges inherent in transitioning such a high number of employees to private-sector employment, Croatia has a highly-educated and skilled workforce and occupies a strategic position within central Europe, bordering the Adriatic Sea, as well as the countries of Hungary, Serbia, Bosnia and Herzegovina, Montenegro, and Slovenia. Although many young, educated Croatians left Croatia to seek employment elsewhere in past years, the economic slump in Europe has brought many skilled Croatians back to the country. Its capital is Zagreb, and its currency is the Kuna.

    The Croatian Labor Act

    Employment in Croatia is governed by the Croatian Labor Act, the Constitution, collective bargaining agreements and individual employment agreements, as well as international conventions and treaties. The Labor Act, which is the main source for labor law in Croatia, regulates leaves, wages, strikes, and prohibits discrimination, among other subjects.

    The Employment Contract

    Under Croatian law, all employment relationships are governed by contract, which must be in writing. The contract may specify an indefinite term, which is common, or a definite term, which is only permitted in limited circumstances. Each contract must include provisions enumerating the parties to the contract, working hours, periods of annual leave, duration of the contract, amount of salary and any salary supplements, and pay and notice periods.

    Although the employee and employer may negotiate certain terms of the employment agreement, many provisions are mandatory. Some of the key mandatory provisions are summed up here:

    In general, the work week may not exceed 40 hours, and overtime may be worked only under special circumstances, and then only up to eight additional hours per week;
    Minors age 15-18 are not permitted to work overtime (no one under age 15 may be employed);
    Employees who work in “harmful” occupations may work less than 40 hours per week pursuant to law;
    Women are generally not permitted to perform night work, and may not work underground, under water, or in very physically demanding jobs;
    Wages must be paid at regular intervals, but not less than once per month;
    Employees are entitled to four weeks’ vacation each year;
    Pregnant women must take leave beginning 28 days prior to the expected birth of her child, and maternity leave may last up to 6 months, although the leave must last for a minimum of 42 days following the birth of a child. Fathers are also entitled to parental leave;
    Employees who work six or more hours per day are entitled to at least one 30-minute break;
    Employers with at least 20 employees must permit its employees to participate in decisions that affect their “economic and social rights and interests.”


    An individual work contract may be terminated by the employer only for “legitimate” reasons, and pursuant to the notice period set out in the employment contract. Legitimate reasons include employee misconduct, employee inability to continue performing his or her job duties, or a change in technology, organizational structure, or economic reasons such that the work need no longer be performed.

    Employers who seek to discharge 20 or more employees at one time must present a “redundancy plan” within 90 days of the planned action, and must work with the regional employment council and workers’ council to design and implement the plan.

    The Croatian Constitution and Gender Equality Act

    Under Article 4 of the Constitution, and the 2003 and 2008 Gender Equality Act, discrimination in employment is expressly forbidden. The Constitution protects citizens from discrimination based on their race, color, gender, religion, and political beliefs. The Gender Equality Act defines sexual harassment, and makes it illegal to engage in sexual harassment in the workplace, or to discriminate based on an employee’s gender, marital status, family status or sexual orientation. Any alleged violations of the Gender Equality Act may be brought before the Ombudsperson for Gender Equality or through the traditional court system. Despite these protections, sexual harassment and discrimination against women in the workplace is not uncommon. Further, although the war following the breakup of Yugoslavia ended many years ago, there is a great deal of ethnic tension within the workplace between and among ethnic Croatians and the almost 30 different ethnic minorities living in Croatia. In particular, the Roma and Croatian Serbs complain about rampant discrimination, harassment and tension in the workplace. Any would-be employer in Croatia will want to ensure that its employment policies comport with Croatian law and that there are mechanisms in place to adequately address workplace discrimination and harassment.

  4. Michael Silovic says:

    To be honest Ina I do not see this goverment being successful in that direction. From all I have seen the way they act towards the diaspora and their treatment of the Croatian people at home who have not fared well at all and we have been sold out to the EU.I honestly believe that we are going to be nothing more then a welfare state ( with 3rd world refugees waiting on our door step for entry ) with our dignity stripped and our heritage lost by the way the goverment is acting and the policy they are following.With out a Croatia First Policy I see our people and our country being in despair for some time to come. The hopes that the EU is our savior is totally false.Those who are wealthy in the EU and elsewhere will only come to Croatia for their own wealth and not the benefit of the people.Their goal is nothing more then to rob us of our resources and give us what is left if anything. Our farming community will be lost which is sad because that has always been a part of our identity and culture. It is sad that I read England wants our people to come to England to work in its agriculture field abroad because they need us because their agriculture industry has exploded while our own at home is ignored. With a 10 billion dollar import in agriculture alone to Croatia we will see many others involved in this industry coming to Croatia to take over the lands and kill our farmers off.I am saddened even more so that England would make such a public statement as that since I guess they see us as nothing more then peasants to pick their crops and ignorant slaves for their own greed. In my opinion England is not a friend of Croatia and nothing more then someone that will want to take advantage of us as much as they can. After all they did not want to work to prevent the Serbs from blowing a dam and killing Croatian people so why should I believe or trust them. we have some serious work to do at home and abroad as Croats to protect our country, people and heritage….. ~Za Dom spremni!~

    • Yes, me too Michael – if I am honest. Not a good track record to count on in Croatia – so a miracle is needed, and who knows, it just might come in a form of people power and some good injections of unspoiled younger politicians.

  5. Waiting for the second STORM…

  6. Storm is a distinct possibility Sunman; clouds are gathering!

  7. A separate employment act is really required to make the working conditions better and more lively. Employer and labour relation are the most unpredictable kind of relations in any organisation. It has been shown for past some time that bad relations of employee and management are a big cause of less quality generated work as if employee is not satisfied with management, he is not able to perform well. The blog shares very informative content regarding the changes in the employment acts in 2009 and its benefits and usage to employees.. Quite good content. To know more about the same, visit us

  8. Andrew Inman says:

    As an Englishman who has tried to make a living in Croatia (lived there for 5 years), employed people, abided by all the rules and helped a lot of people, I have a variety of views about Croatia. Beautiful country, some truly wonderful people BUT, whether it is nice to hear or not, and this particular view is borne out by vast numbers of foreigners who have lived and worked there, Croatia has been a pretty unwelcoming place. Jealousy, fierce determination to rip you off, employment legislation that is so complex and pro-employee that it acts a MASSIVE disincentive to hire people, corruption (especially in health care where some of the stories we have heard, and our own experiences, hardens the heart to the nation as a whole) are just some of the issues that colour our view.

    Generally, the people are well educated but are held back by the truly appalling government; from the incompetent, corrupt, inefficient centre to the incompetent, corrupt, inefficient local authorities. They should be desperate to allow investment and yet are obsessed by foreigners stealing their assets (never mind that they turn a blind eye to the outrageous theft of state assets in the post-war period).

    To sum up, we moved there charmed by the beauty and simplicity of the place. We left, having worked very hard and having invested a lot, completely disillusioned and doubting the ability of Croatia to pull itself up and start to be what SOME of its people deserve it to be.

    • Andrew Inman it seems you’ve experienced first-hand the remnants of communist regime – everything you say was ingrained during the 50+ years of communism, everything you say plus more was what drive many away into emigration, protecting the workers and tenure regardless of productivity etc etc and the saddest thing is that after all the war had finished and Croatian territory finally reintegrated (1998) the path to transitioning into democracy, free trade, merit and performance based employment, accountability etc have suffered greatly and it will take a while yet I think…thank you on your comment

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