Last updated: 4 October 2018
Labor shortages and the alarming migration of young people to other Western European countries are the main factors that have led to the adoption of several regulations that aim, in particular, to a greater flexibility and to the modernization of labor law. Among such regulations, the internship law (Law no 176 of 17 July 2018), which came into force in mid-August, deserves the employers’ attention.
Through this law, which allows young people aged 16 or over to work under paid internship programs and earn income on the basis of a fixed-term contract (which is taken into account when calculating their length of service), Romania is finally aligned with the practices existing at the European level since 2010.
INTERNSHIP CONTRACT: CONDITIONS TO BE MET BY EMPLOYERS
Employers wishing to work with interns can do so if they demonstrate the implementing of an internship program and meet a number of conditions, including:
• The number of internship contracts concluded simultaneously does not exceed 5% of the total number of classic employment contracts. Companies having a maximum number of 20 employees may simultaneously conclude 2 internship contracts at most.
• The company may conclude a single internship contract with the intern, unless the firm enters into several internship contracts for different internship programs and their overall duration does not exceed 6 consecutive months.
• At the end of the internship period, the employer has to assess the intern and grant him/her an internship certificate.
There are also several interdictions that companies have to take into account. Thus, they can not enter into internship contracts if:
• they have had work/service relationships with the persons wishing to enter into an internship contract;
• one or several directors/shareholders of the company have held the same capacity in other companies, with which the person concerned has had work/service relationships;
• the company enters into an internship contract in order to avoid signing an employment contract and it has not been yet 3 years since the application of the related sanction.
As regards how these employment contracts are managed, the law provides - as in the case of classic employment contracts - the employer’s obligation to keep record of the intern’s working time and to submit such records to the inspection authorities, if the latter require it. Thus, within 60 days from the entry into force of the law, the National Employment Agency, through its local directorates, has the obligation to set up an electronic register of internship contracts, wherein they must fill-in data about such contracts.
Attention! Until the introduction of this register, each company must keep record of all internship contracts via their own system.
COMPULSORY REMUNERATION AND THE POSSIBILITY TO OBTAIN SUBSIDIES
Under the law, an intern is entitled to a remuneration of at least 50% of the gross minimum wage at the national level, proportionally with the actual working time. Violation of this provision by employers entails fines between 2,000 and 4,000 lei.
Unlike apprenticeship o traineeship contracts (the latter being attached to an employment contract), on the basis of which companies receive 2,250 lei for each apprentice/trainee, for the internship contract, the law does not establish any subsidy, unless companies intend to subsequently employ the intern in question.
Thus, the "reward" for companies for concluding individual employment contracts subsequent to internship contracts will be of approximately 4,586 lei, provided the employment contract is maintained for at least 24 months. All private companies, except public institutions/authorities, can benefit from these subsidies.
THE INTERNSHIP CONTRACT
As with classic employment contracts, internship contracts must be concluded in written form, in Romanian, and at the latest one day before the start of the internship program. The internship duration can not exceed 6 months, or 720 hours in total, and such duration can not be extended.
The internship contract may be suspended if the intern is temporarily incapacitated, but the length of the suspension is not taken into account in the calculation of the internship period. The contract may also be terminated:
• upon expiry;
• by mutual agreement of the parties;
• by automatic termination, when one of the parties fails to perform or improperly performs its obligations under the contract, under certain conditions;
• by the conclusion of an employment contract between the parties;
• by unilateral termination by one of the parties, in well justified cases, pursuant to a prior notice sent at least 15 days before termination date;
• when the suspension of the contract exceeds 1/3 of the internship duration.
A UNIFORM PRACTICE AT THE EUROPEAN LEVEL
Internship is widely used all across Europe. In this case, the legal basis is European Parliament Resolution no. 2009/2221 (INI) of 6 July 2010 on promoting youth access to the labor market, strengthening trainee, internship and apprenticeship status..
The European regulation encourages Member States to create effective incentives (such as employment subsidies or social security contributions for young people) that guarantee decent living and working conditions. It also urges Member States to allow young people working under internship programs to acquire professional experience and to grant them all employment and social security rights and subsidize, if necessary, part of their contributions.