Draft proposal on Labour and Social Security Records Law

The Ministry of Labour, Family, Social Affairs and Equal Opportunities (Ministry) has submitted a Draft proposal on Labour and Social Security Records Law (Proposal), which introduces new obligations for employers in several areas. The Law was originally adopted in 2006 and has not been amended since. Now, the Ministry has put forward a Proposal to regulate and improve mainly the area of keeping records on working time of the employees at the workplace.

The Proposal aims to prevent abuse in this area and also to allow for more effective inspection control.

The main objectives of the Proposal are:

  • to define the range of information to be recorded in the records on working time;
  • to establish a method of keeping and storing records that would prevent abuse;
  • to ensure more effective inspection;
  • to ensure that the employee has the opportunity to be informed of the information contained in the records;
  • to ensure compliance with the provisions on working time and the provision of rest and break periods for employees; and
  • to establish and define sanctions and fines for the legal person responsible in the event of breaches of the provisions.

In the light of the above, it is clear that the Ministry’s main aim with the Proposal is to curb, or at least significantly reduce, manipulations and other abuses of rights suffered by employees in the course of their work. One of most frequent abuses in practice are attempts to manipulate the amount of working time and consequently related payments, which in some cases do not always correspond to the actual amount of work being done.

The Proposal primarily foresees that the records on working time should also include information on the time of arrival and departure of the worker to and from work, the use and extent of use of breaks during working time, the hours worked in special working conditions, resulting from the distribution of working time, the hours worked in unevenly distributed working time and as in temporarily redistributed working time, as well as the aggregation of working hours over a longer period of time (week, month, year, or a single reference period). Under the current legislation, there is only a requirement for information on the number of hours worked by the employee.  The records therefore do not show whether the work was done in less favourable working time or whether it has been done in irregularly distributed or rescheduled working time. This current arrangement also creates difficulties in carrying out state inspections and often makes it impossible to monitor working time, breaks and rest periods.

The second major change concerns the way records are kept. Under the current legislation, the way in which records are kept is still left to the employers. The Proposal proposes for records of working time to be kept in electronic form, which should in practice ensure their credibility and consequently provide more effective state related inspection of employers’ compliance with their obligations. Given that the introduction of electronic record-keeping represents a significant departure from current practice, the Ministry’s Proposal provides for a transitional period to allow for the gradual implementation of the electronic record-keeping system by employers. The obligation to use electronic record-keeping should be introduced no later than twelve months after the IT support for electronic record-keeping is in place.

In this respect, the Proposal also proposes that all alterations to the records must be recorded in such a way that any subsequent change to the data must include the reason for the change and the time at which the change was recorded, also the employer must provide the employee with access to the information contained in the working time records.

From the point of inspection and sanctioning those responsible, the Proposal foresees the establishment of fines in euros, as under the current legislation the fines are still set in tolars, and changes to the amounts by which the fines are set, as well as the authority of the Labour Inspector to impose fines within a range. The current legislation does not foresee a sanction for the responsible person, so the proposal also foresees a sanction for the responsible person in case of a breach of the failure to keep, store or update the records kept by employers.

As an addition worth mentioning, the Proposal is also changing the definition of worker, according to which a worker would be defined as a person who performs work for an employer on whatever legal basis, if they perform the work personally and are involved in the employer’s work process, or predominantly use the means of performing the work which are part of the work process.

In conclusion, the Proposal addresses an ever-present and pressing issue in the field of employment relations, which, if strictly adhered to, would in practice ensure transparency in record-keeping and make possible abuses very unlikely, while at the same time safeguarding the rights and interests of workers vis-à-vis their employers. However, it should be borne in mind that the Proposal, due to the introduction of the electronic system, foresees a longer implementation period of twelve months, which will depend on the establishment of IT support for electronic record-keeping. The latter means that the real impact of the Proposal, if it is actually adopted, may only be seen in a few years’ time, along with its potential flaws.

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Law firm Sibinčič Novak & Partners
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