Document Sample
Croatia Powered By Docstoc

         Market Conditions Summary - CROATIA 2011   Market Conditions Summary - CROATIA 2011
                                                    LAW                                                                                MARKET PRACTICE

Recruitment and Contract
Probationary Period                                 Up to 6 months during which minimum notice period is 7 days                        1 to 3 months
Probationary Period
Extension                                           Not possible to extend the probationary period over 6 months
                                                    2 weeks for up to 1 year of service and 1 month for more then 1 year of service.
                                                    After 2 years of service the legal notice periods are increased and is at least as
                                                    + 2 years: 1 month+2 weeks + 5 years: 2 months
                                                    +10 years: 2 months+2weeks                                                         Common practice for general staff is to follow the legal minimum
                                                    +20 years: 3 months (begining from the date of termination of contract)            requirements. Common practice for key personnel, executives,
Notice Period                                       .                                                                                  and management is a notice period of 3 to 6 months.

                                                    Working relations in Croatia are regulated by legislation, collective and
                                                    individual contracts as well as regulations brought by the employers.Labour
Fixed Term Contract                                 Law regulates:Legal basis of employment contract, working hours, holidays and
Regulations                                         leaves, salaries, termination, employee's rights and obligations.
Retirement Age                                      Age 65 for men and 60 for women

Employment Conditions

Working Hours                                       Full weekly working time must not exceed 40 hours.                                 40-hour week for general staff and executives
                                                                                                                                       24 working days based on a 6-day working week (4 weeks
Vacation                                            Min. 20 working days based on a 5-day working week (4 weeks vacation)              vacation)
Special Leave                                       Up to 7 working days a year
Birth of Child                                      up to 3 days                                                                       Up to 3 days
Death of Spouse or child                            up to 4 days                                                                       Up to 3 days
                                                                                                                                       Up to 4 days for member in same household and 2 days for
Death of Father or Mother                           up to 4 days                                                                       member not in same household
Marriage                                             up to 3 days                                                                      Up to 3 days
Marriage of a child                                 up to 3 days                                                                       Up to 3 days
others                                              1-2 days                                                                           1-2 days
                                                    Statutory Public Holidays in state: New Years' Day, Epiphany Easter, Easter
                                                    Monday, Labour Day, Uprising day, Corpus Christi day, State Day, Patriotic
                                                    gratitude day, Assumtion day, Independence day. All Saints day,Christmas
Public Holidays                                     Day, St.Stephen's day.
                                                    45 days before and 6 months after child birth. The employer is obliged to
                                                    balance the benefit from the State health insurance fund to 100% of net salary
                                                    for period. The mother/father is entitled to an allowance paid by the State
                                                    1.600,00 - 2.500,00 KN (depending on salary) of up to 1 year for 1-2 children
Maternity leave                                     and up to 3 years for 3 and more children.                                           Most companies follow staturory practice.
                                                    The father is entitled to paternity leave and also applies to what is related to the
                                                    mothers during maternity leave ( financial compensation, prohibition
                                                    cancellation etc. ) Father is entitled to 8 months paternity leave ( to be taken
Paternity and Parental                              after child birth ). Two months are an incentive from the State for fathers to use
Leave                                               parental leave.                                                                      Most companies follow statutory practice.
                                                    Unpaid leave requires de-registration from Pension and Health insurance and
Unpaid leave                                        re-registration when return.

Bonus                                               Emloyee is entitled to bonus if defined by employment contract.
                                                    Employee is entitled to salary compensation in the gross amount agreed in          Typical practice for general staff is 12 months pay plus half
                                                    employment contract. Salary is paid in time period no longer than one month,       month salary in June or July ("vacation pay") and an additional
Months of salary payment                            twelve monthly salaries payments.                                                  month in December ("Christmas bonus").

Social Coverage

1                                                       45c47754-cea7-41e5-bf32-4572f0b51414.xls           9/22/2011

         Market Conditions Summary - CROATIA 2011                       Market Conditions Summary - CROATIA 2011
                                                                        LAW                                                                                  MARKET PRACTICE

                                                                        It is a legal requirement for the employer for the first 42 days of incapacity to
                                                                        work due to sickness and cannot be lower then 70% of salary from the first day
                                                                        of sickness. Starting with the 43rd day a cash sickness benefit becomes
                                                                        payable from the State Health Fund in the amount of 70% of salary for 18
                                                                        month up to the earnings ceiling for State Health Fund purposes and after that
                                                                        period in the amount of 50% of salary.There are exceptions when the salary
                                                                        compensation is 100% from the State Health Fund: in case of leave due to
                                                                        injury at work or occupational disease; sick leave due to illness and
                                                                        complications related to pregnancy and child birth; compulsory matenity leave
Payment of salary after                                                 and nursing a sick child younger then 3 years of age. For nursing a child older
accident or sickness                                                    then 3 year compensation from State Health Fund is 70% of salary                  Most companies follow statutory practice.
Life insurance                                                                                                                                            Separate life insurance is uncommon in Croatia.
Military Service

                                                                        Total contribution rate to the Croatian social security system is 17,2% on gross
                                                                        salary at the expence of the employer. This contributions consists from: health
                                                                        insurance contribution at 15% on gross salary; special contribution for
                                                                        insurance against accidents at work and professional disease at 0,5% on gross
Social Insurance                                                        salary and employment contribution of 1,7% on gross salary.
                                                                        Early retirement is possible at age 60 (men) and age 55 (women). These
                                                                        different ages will be equalized to age 60 in the next 9 years and a reduction for
Early retirement                                                        each month of early retirement prior to age 65 is applied.
Principle of the pension

                                                                        15% of salary up to ceiling of 45.492,00 KN for pension insurance based on
                                                                        generation solidarity (so-called I pillar) and 5% of salary for compulsory pension
Contributions                                                           insurance based on the individual capitalized savings (so-salled II pillar)
                                                                                                                                                             The statutory accident insurance only covers accident at work
                                                                                                                                                             or accidents on the way between home and work place.
                                                                                                                                                             Providing an additional accidental death and disability insurance
Accident Insurance                                                      0.5 % on gross salary at the expence of the employer.                                is common practice in Croatia.
                                                                                                                                                             Companies do not generally provide any additional health care
                                                                        Membership in one of the State Health Funds is mandatory for all employees .         benefits. They follow statutory practice which is to pay the
Health Insurance                                                        Contributions to the State Health Fund is 15% on gross salary .                      applicable contribution rate.
Long Term Care Insurance                                                                                                                                     Companies do not provide additional benefits
Disability Insurance                                                    0.10 % on gross salary at the expence of the employer.                               Statutory obligation for companies with 20+ employees.
                                                                        Between 199,56 - 831,50 KN per month per child. Child allowances are paid by
Child Allowance                                                         the State                                                                    Companies do not provide additional benefits
SOCIAL INSURANCES                                                       Pension insurannce and Health insurance
Unemployment insurance
Unemployment insurance
(cont)                                                                  1,7 % on gross salary at the expence of the employer.
Professional and non-
professional accident
Loss of earnings insurance
for sickness
Health Insurance

                                                                        By Labour Law minimal notice period is two weeks and maximal is six months,
                                                                        depending on years of service. Employee is entitled to severance pay after two
                                                                        years of continuous work at the same employer in case of business conditioned
Termination Indemnities, notice periods, severance pay                  termination
Is a termination indemnity paid whatever reason the employee leaves ?   No
Is a termination indeminity only required if the empoloyee is fired?    Yes

2                                                                           45c47754-cea7-41e5-bf32-4572f0b51414.xls           9/22/2011

           Market Conditions Summary - CROATIA 2011                                                  Market Conditions Summary - CROATIA 2011
                                                                                                     LAW                                                                         MARKET PRACTICE

                                                                                                     Severance pay is determined as average net earning received over the last
                                                                                                     three months of work. This amount cannot be lower than one third of these
What are the rules about this severance pay?                                                         earnings and cannot be higher thansix months earnings.


    If a company wants to employ staff on behalf of another company is there any special licensing

    Is it legal to subcontract Agency’s employees through another Agency (for example – Staffing
     Company A subcontracts with Staffing Company B to place Company B’s employee at their
            customer’s site - this is legal in the US but illegal in Japan, Germany and France)

3                                                                                                        45c47754-cea7-41e5-bf32-4572f0b51414.xls       9/22/2011

Shared By: