Serbia

INDICATORS OF THE QUALITY OF WORKERS’ RIGHTS

Mario Reljanović

1. EMPLOYMENT OPPORTUNITIES

1.1 Legal foundations of the rights of workers

Current Labour Law was adopted in 2005, with major amendments in 2014 (more than one third of the law was significantly changed on the occasion). Procedure for adoption in 2014 was not respected, trade unions were not part of the working group in the last stages, contrary to the law Social and economic Council never adopted opinion on the amendments and there was no public debate. Trade unions strongly opposed the amendments.

Labour Law matter has been divided over the years to the number of so-called side-laws, regulating only one aspect of the workers’ rights, or some specific work regimes. Serbia has separate Law on Strike, Law on Seasonal Work, Law on Agency Employment, and more. There are even some labour regimes that were introduced through the by-laws, which is unconstitutional, like the Ordinance on the programme “My first salary”.

1.2. General situation on the labour market

According to the Labour Force Survey conducted by the Statistical Office of the Republic of Serbia, data on general situation on the labour market for the first quarter of 2024^[1] is as following:

• activity rate was 56.2%;
• employment rate was 50.9%;
• informal employment rate was 12.1%;
• unemployment rate was 9.4%.

Total number of workers in the first quarter of 2024 was 2,313,672. Public sector employed 614,522 people, while the rest of them were in the private sector. There were 414,777 workers employed as the entrepreneurs (or at the entrepreneurs) and 50,909 registered agriculturists. Most workers in the private sector worked in the processing industry (500,666) and in wholesale and retail trade businesses (358,926).

1.3. Other important issues

It is important to emphasise that the employment rate, according to the methodology used, refers to every working person, regardless of whether they worked in an employment relationship or not. This rate includes both short-term and undocumented (informal) employment. On the other hand, the unemployment rate is applied only to those persons who are actively looking for a job in the observed period through the National Employment Service, and not to those who do so in other ways.

Unemployment rate of young people still stands high at 24.5%.

The rate of informal employment is decreasing, but it is still high in some activities: in agriculture the rate is as high as 50.5%.

It should also be noted that the employment rate calculation methodology leads to unrealistically high employment rates in months when seasonal jobs are current.

2. ADEQUATE EARNING AND PRODUCTIVE WORK

2.1. Basic data on earnings

Basic data on workers’ earnings are as follows:

• minimum wage for the year 2024 is 271 RSD (cca. 2.31 €)^[2] per working hour, without income tax and social insurance contributions; for a month consisting of 176 working hours, the minimum wage for full-time employment is stipulated at 47,696 RSD (cca. 406 €);^[3]
• average earnings (net amount) were 96,913 RSD (cca. 824.79 €);^[4]
• medial earnings were 72,979 RSD^[5] (cca. 621.10 €);
• the ratio of the minimum wage to the living wage (144,457 RSD for 2023, cca. 1,235 €) in March 2024 was 1:3.17 (minimum wage covered 31,52% of the living wage);^[6]
• the ratio of medial earnings to the living wage in March 2024 was 1:1.98 (medial wage covered 50.52% of the living wage);
• highest net earnings were in the media and communication^[7] (224,484 RSD, cca. 1,910 €) and the finance and insurance (143,817 RSD, cca. 1,224 €); lowest earnings were in the agriculture (75,161 RSD, cca. 640 €) and the wholesale and retail trade businesses (79,674 RSD, cca. 678 €).^[8]

2.2. Other important issues

There is no minimum wage regulation in collective agreements, the minimum wage established by law applies to all workers. The increase in wages in previous years is statistically significant, but it is insufficient to keep up with inflation. This particularly applies to the rise in prices of consumer goods.

In official statistical reviews, the category “minimum consumer basket” is used, which is also one of the factors for determining the minimum wage according to the Labour Law. However, this category is not suitable for realistic economic comparisons of income with living expenses, because it represents the expenses of the poorest three deciles of the population that they could afford for basic life needs (minimum consumer basket in April 2024^[9] was 53,371 RSD, (cca. 454 €).

Risk of Being Poor

• In 2023, the at-risk-of-poverty rate was 19.9%, which is 0.3 percentage points lower compared to 2022.
• The at-risk-of-poverty rate represents the percentage of individuals whose equivalent disposable income is below the at-risk-of-poverty threshold, which in 2023 amounted to 29,100 dinars (cca. 248.71 €) on average per month for a single-person household.

3. DECENT WORKING TIME

3.1. Basic data on working time

According to the Labour Law of Serbia:^[10]

• the legal maximum duration of full-time work: 40 working hours (over-time not included);
• average working time (Eurostat data on 2023):^[11] 41.7 working hours per week;
• the legal maximum duration of overtime work: 8 hours per week and 4 hours per day;
• the legal maximum duration of working time in the redistribution of working time: 60 hours per week and 13 hours per day; however, average working hours in the whole period of redistribution have to be within the 40-hours working week;^[12]
• minimum hours of daily rest: 12 hours (11 hours in redistribution regime);
• minimum hours of weekly rest: 24 hours;
• minimum duration of annual leave (in days or working weeks): 20 working days, 4 working weeks.

3.2 Additional information on working time

According to the Labour Law of Serbia:

• There are specific reasons for introduction of overtime stipulated by law (in the event of force majeure, a sudden increase of volume of work and in other cases when it becomes indispensable to complete an unplanned work within a specific deadline).
• There are specific reasons for the introduction of redistribution of working hours stipulated by law (where so required by the nature of the activity, organisation of work, better utilisation of means of work, more rational use of working hours, and the execution of a specific job within the set deadlines).
• Overtime is paid at an increased rate (added 26% on the basic salary).

3.3. Other important issues

It should be noted that employers often do not comply with the provisions related to providing explanations for the introduction of overtime and redistribution of working hours, or those explanations are formal and have no basis in reality. A six-day working week lasting 48 working hours is common in many processing industries, as well as in trade, tourism and some other service industries. Although this conduct is illegal since the long working hours are not substantiated with reasonings as prescribed by the law, it is tolerated by the labour inspectors.

4. STABILITY AND SECURITY OF WORK

4.1. Information on stability of work

According to the Eurostat data for the fourth quarter of 2023,^[13] 20% of workers in Serbia had a fixed-term employment contract. There is also Eurostat data for temporary agency workers in Serbia: rate of agency workers in total number of workers was 1,3% in 2022.^[14]

Fixed-term contracts were stipulated on the following principles set in the Labour Law of Serbia:

• maximum contract duration is 24 months, with exceptions set by Labour Law;
• there is no possibility of concluding a fixed-term contract without a special reason (provided by the law);
• there is a possibility of extending the contract and concluding a larger number of consecutive contracts; there is no maximum number of consecutive contracts stipulated by Labour Law, as long as their cumulative duration is within the legal boundaries.

4.2. Information on security of work

According to the Labour Law of Serbia:

• the reasons for contract termination are prescribed by the Labour Law;
• the contract termination procedure is prescribed by the Labour Law;
• the notice period is prescribed by the Labour Law in one occasion only (employee whose employment contract has been cancelled due to unsatisfactory work performance, and/or lack of necessary knowledge and skills, is entitled to a notice period to be determined by a bylaw or employment contract, which may neither be shorter than eight, nor longer than 30 days);
• the severance pay is provided only on occasion of redundancy dismissals; the amount of severance pay is determined by a bylaw or employment contract, provided that it may not be lower than the sum of the third of the employee’s salary for each full year of work in employment relationship with the employer where he exercises the right to severance pay;
• in case of termination of the labour contracts, all employees have the right to be paid all due and unpaid wages and other benefits they earned during their work; employees may have other rights, depending on the way the employment relationship is terminated;
• if the termination of the labour contract is initiated by the employer, unemployment insurance is provided only in cases of bankruptcy or liquidation of the employer, termination of the short-term employment contract and in cases of termination due to redundancy, under certain conditions set in the Law on Employment and Unemployment Insurance^[15] regarding the total duration of the unemployment insurance.

4.3. Other important issues

Legal provisions on the reasons for concluding a fixed-term employment contract are usually not respected or are only formally stated, even though they do not correspond to reality. Although this practice is illegal, the labour inspectorate tolerates it.

Changes made to the Labour Law in 2014 significantly facilitated the dismissal procedure and disincentivized workers to initiate a labour dispute due to illegal dismissals. Trade union representatives are formally protected from dismissal based solely on their union work. However, they are very often victims of abuses that exist in relation to the regular dismissal procedure. In case of short-term contracted trade union representatives, the contract with them is simply not extended after the old one expires. If they have contracts for an indefinite period, they are usually fired on the basis of violation of work discipline, for alleged disciplinary offences (that employers usually faked).

Persons who are engaged in so-called non-employment work (specific types of work engagement contract which do not constitute labour relation but which are nevertheless stipulated by the Labour Law) do not exercise any of the above-mentioned rights. Among others, they do not have the rights to legally determined grounds for termination, termination procedure or notice period (their contracts can be terminated at any time, effective immediately).

5. EQUAL OPPORTUNITY AND TREATMENT

5.1. Information on the national anti-discrimination system

There is a Law on Prohibition of Discrimination^[16] since 2009. Discrimination in the field of work has been regulated by that law, but also by the Labour Law and several other laws. Discrimination in general, thus discrimination in the field of work included, is prohibited according to any personal characteristic. There are specific norms stipulating prohibition of discrimination in employment, in terms of exercising rights based on work, career advancement, termination of labour contract. In accordance with the Law on Prohibition of Discrimination, the office of the Commissioner for Protection of Equality has been established. If a person considers that she/he has been a victim of discrimination, several legal mechanisms can be initiated, among others legal dispute before the court and special protection mechanism before the office of the above mentioned Commissioner.

5.2 Information on the national gender equality system

There are specific norms prohibiting discrimination on the basis of gender, family obligations. It is not allowed to ask questions about marital and family status during a job interview.

There is no obligatory paternity leave. Parents may decide who will use cca. nine-months leave after the mother has used mandatory three-months maternity leave.

5.3. Information on the effects of the anti-discrimination system

According to the data based on the quarterly Labour Force Surveys of the Statistical Office of the Republic of Serbia, data in gender (in)equality for 2023 are the following:

• there is a gender gap in activity rate of 12.1 percentage points;
• there is a gender gap in employment of 11.6 percentage points.

Principle of “equal pay for the work of equal value” has been accepted in the Labour Law of Serbia. However, according to the Statistical Office of the Republic of Serbia (data from September 2023)^[17] there is a gender gap in earnings of 14.3% overall. This gap is higher with the higher level of education, so it is 26.7% among faculty (highly) educated men and women and 25.8% among post-graduated workers (LL.M., Ph.D. and others).

5.4. Other important issues

Although the anti-discrimination system is normatively complete, in practice there are many cases of discrimination. In 2019, the Commissioner for the Protection of Equality pointed out in a special report the extremely high prevalence of discrimination in the field of work.^[18] Discrimination in the field of work is most prevalent in relation to persons with disabilities, younger and older workers, Roma, as well as in relation to gender stereotypes.

6. SAFE WORK ENVIRONMENT

6.1. Indicators of providing adequate measures for protection and safety of workers

According to the official statistics, this is relevant data for year 2023:

• the number of workers killed on an annual basis in 2023 was 42 people;^[19]
• the number of serious bodily injuries of workers in 2023 was 886;^[20]
• number of killed workers per 100,000 workers in 2023 was 1.8;
• number of serious bodily injuries per 100,000 workers in 2023 was 3.75;
• 218 labour inspectors^[21] were engaged on 2,360,588 workers, which equals one labour inspector on every 10,828 workers, or 0.92 labour inspectors on 10,000 workers.

6.2. Arrangement of the occupational health and safety system

In accordance with the Law on Occupational Safety and Health,^[22] there are internal and external mechanisms for the protection of workers’ rights related to occupational safety and health. A worker who believes that her/his safety, life or health is threatened, that is, that safety and health protection measures are not respected, can refuse to work in such conditions. Also, the worker can leave her/his workplace in that situation. The labour inspection is one of the external mechanisms for the protection of workers’ rights in this area. The labour inspector can stop the work process at a certain workplace, in a certain workspace, or in relation to the employer as a whole, if she/he believes that there is a danger to the life or health of workers or third parties.

Paid sick leave is possible, and salary compensation amounts to 65% (in most cases) or 100% if the cause of the inability to work arose during the work process, also in the case of maintaining a pregnancy. Documentation for sick leave is issued by a general practitioner and it can last up to 30 days, after which the employee goes to the examination of the medical board of the Medical insurance fund. There are mechanisms for the employer to verify the authenticity of sick leave – it can ask for a medical commission expertise at any time. It cannot refer the worker to private practitioners, or conduct any kind of investigation that would lead to the violation of the right to privacy of the worker, nor to violation of the right to protection of his/hers personal data.

6.3. Other important issues

There is a significant deficit of labour inspectors in the field of occupational safety. Criminal liability and misdemeanour liability of the employer are practically non-existent, since the majority of procedures for determining liability do not end with a conviction, or the imposed sanction is extremely mild and disproportionate to the violation of the law. According to the 2023 research, only 3% of responsible persons at the employer are found guilty for the death of workers at work, and sentenced to imprisonment.^[23] By the law, workers can refuse to work in unsafe conditions, but they rarely do so because of the fear of consequences – usually dismissals, but also harassment at work.

7. SOCIAL SECURITY

7.1. Adequate amount of workers’ pensions

According to the data available, following comparisons were possible:

• the minimum pension for 2024 is 24,987 RSD (cca. 212.66 €);^[24]
• average pension amount (for May 2024): 45,732 RSD (cca. 389.21 €);^[25]
• the amount of the medial pension is not available;
• the ratio of the living wage (living wage for 2023 was 144,457 RSD, cca. 1,235 €) to the minimum pension is 1:5.78 (minimum pension covered 17.18% of the living wage) and the ratio of the living wage to the average pension 1:3.16 (average pension covered 31.41% of the living wage);
• the number of employed pensioners is cca. 50,000;^[26]
• the number of old people who have reached the end of the working age and who have not realised the right to any type of pension is cca. 150,000.^[27]

7.2. Other important issues

Pension of agricultural workers are extremely low: 19,779 RSD (cca. 168.33 €) was their pension in March 2024. Also, there is growing concern that existing pension insurance is not enough in the long term and that will lead to further enhancement of poverty of elderly people. According to some calculations, workers with 40 years of pension insurance would have the rights to a pension of only around 220 €, if their earnings were whole time at the level of minimum wages.^[28]

An insured person acquires the right to an old-age pension when they reach:

• 65 years of age and at least 15 years of insurance contributions;^[29]
• 45 years of insurance contributions, regardless of age.

8. SOCIAL DIALOGUE, EMPLOYERS’ AND WORKERS’ REPRESENTATION

8.1. Basic data on effects of social dialogue and collective bargaining

Rate of unionisation of workers (trade union density rate) has not been officially determined for more than one decade, since 2010 when it was 27.9%.^[30] Thus, the last official data is not relevant, since the rate of unionisation certainly dropped over the last decade. Some estimates consider that around 25% of workers were members of trade unions in 2017, mostly in the public sector.^[31]

Collective agreements coverage rate on the national level is also unknown. There are no official data, and some estimates consider it to be in the range of 25% in 2016.^[32]

There are two representative trade unions and one representative employers’ association (which mainly gathers domestic employers and does not have large foreign employers among its members) at the national level.

8.2. Additional information on social dialogue bargaining

According to the Law on Socio-economic Council,^[33] there is a Social and conomic Council of the Republic of Serbia and local socio-economic councils that could be organised in every unit of the local self-government. Serbia does not have a general collective agreement since the old one expired in 2011. There are some ad hoc or permanent tripartite bodies; management board of compulsory social insurance funds are organised on tripartite principles. Foreign employers are mostly left out of the collective bargaining processes; only few of them are members of the only representative employers’ association, Serbian association of employers.

8.3. Other important issues

There are serious problems with the functioning of social dialogue. Trade union organisation and activities are actively and illegally suppressed by some employers, and such behaviour is not adequately sanctioned by competent state authorities. There is a perception that the actual power to decide on economic and social rights has been shifted to lobby organisations and foreign chambers of commerce, so social dialogue is mostly only simulated and not sincere. Collective bargaining is being conducted only at low levels (at individual employers) and with modest results.

Production of this document was supported by Rosa Luxemburg Stiftung Southeast Europe with funds of the German Federal Foreign Office. This publication or parts of it can be used by others for free as long as they provide a proper reference to the original publication. The content of the publication is the sole responsibility of the Centre for the Politics of Emancipation and does not necessarily reflect a position of RLS.

[1] Statistical Office of the Republic of Serbia, Labour Force Survey, I Quarter 2024, https://www.stat.gov.rs/en-US/vesti/statisticalrelease/?p=15166&a=24&s=2400?s=2400, 25.6.2024.

[2] At conversion rate: 1 € = 117,5 RSD. This rate will be applied through the Report.

[3] Decision of the Government of Serbia on minimum wage for the period January – December 2024, Official Gazette of the Republic of Serbia, no. 79/2023.

[4] Statistical Office of the Republic of Serbia, Statistical report for March 2024, https://www.stat.gov.rs/sr-latn/vesti/statisticalrelease/?p=15139&a=24&s=2403?s=2403, 25.6.2024.

[5] Ibidem.

[6] Living wage costs calculations (for year 2023) according to the research of Centre for the Politics of Emancipation can be found here: The Position of Workers in the Serbian Automotive Industry, https://cpe.org.rs/wp-content/uploads/2024/06/Position-of-Workers-in-Automotive-Industry-in-Serbia-CPE-WEB-2024.pdf (25.6.2024.), page 22.

[7] Average earnings in this sector are highly impacted by the fact that programming is included in this sector of industry, with the average of 280.378 RSD, cca. 2386 €).

[8] Data for months January – April, 2024. Source: Statistical Office of the Republic of Serbia, Average earnings by worker, April 2024, https://publikacije.stat.gov.rs/G2024/HtmlL/G20241168.html (18.7.2024.).

[9] Ministarstvo unutrašnje i spoljne trgovine (Ministry of Internal and Foreign Trade), Kupovna moć stanovništva – Potrošačka korps, April 2024 (Purchasing power of the population Consumer basket, April 2024), https://must.gov.rs/extfile/sr/8871/Korpa%20%20april%202024.pdf, 20.7.2024.

[10] Labour Law, Official Gazette of the Republic of Serbia, nos. 24/2005, 61/2005, 54/2009, 32/2013, 75/2014, 13/2017 – Constitutional Court decision, 113/2017 and 95/2018 – authentic interpretation.

[11] Eurostat, Average number of actual weekly hours of work in main job, by sex, age, professional status, full-time/part-time and occupation,

https://ec.europa.eu/eurostat/databrowser/view/lfsa_ewhais__custom_11614965/bookmark/table?lang=en&bookmarkId=a56b1b2f-2acf-458b-a9e4-94cdb6751c88, 25.6.2024.

[12]

[13] Eurostat, Temporary employees as a percentage of the total number of employees, by sex and age (%), https://ec.europa.eu/eurostat/databrowser/view/lfsq_etpga/default/table?lang=en&category=labour.employ.lfsq.lfsq_emptemp, 25.6.2024.

[14] Eurostat, Temporary employment agency workers by sex, age and NACE Rev. 2 activity, https://ec.europa.eu/eurostat/databrowser/view/lfsa_qoe_4a6r2/default/table?lang=en&category=labour.employ.lfsa.lfsa_qoe, 25.6.2024.

[15] Law on Employment and Unemployment Insurance, Official Gazette of the Republic of Serbia, nos. 36/2009, 88/2010, 38/2015, 113/2017, 113/2017 – other law, and 49/2021

[16] Law on Prohibition of Discrimination, Official Gazette of the Republic of Serbia, nos. 22/2009, and 52/2021.

[17] Republički zavod za statistiku (Statistical Office of the Republic of Serbia), Zarada zaposlenih prema delatnosti, nivoima kvalifikacije i polu, septembar 2023 (Earnings of employees by activity, qualification levels and gender, September 2023), https://publikacije.stat.gov.rs/G2024/HtmlL/G20241099.html, 25.6.2024.

[18] Poverenik za zaštitu ravnopravnosti (Commissioner for Protection of Equality), Poseban izveštaj o diskriminaciji u oblasti rada i zapošljavanja (Special report on discrimination in employment and the field of work), https://ravnopravnost.gov.rs/wp-content/uploads/2023/03/12-19.pdf, 25.6.2024.

[19] Inspektorat za rad Republike Srbije, Godišnji izveštaj Inspektorata za rad za 2023. godinu (Annual Report of the Labour Inspectorate for 2023), https://www.minrzs.gov.rs/sr/dokumenti/ostalo/izvestaji-o-radu/plan-inspekcijskog-nadzora, 26.6.2024.

[20] Ibidem.

[21] Ibidem.

[22] Law on Occupational Safety and Health, Official Gazette of the Republic of Serbia, no. 35/2023.

[23] Slađana Jovanović, Mario Reljanović, Krivična dela u oblasti rada, Beograd, 2023, https://iup.rs/wp-content/uploads/2023/06/2023-Krivi%C4%8Dna-dela-u-oblasti-rada.pdf. There are convictions in only 14% of cases related to the death of workers. If the person responsible was found guilty, in 3% was sentenced to imprisonment, in 7% to conditional sentence, and in 4% to house arrest.

[24] Fond penzijskog i invalidskog osiguranja (Pension and Disability Fund), Statistički mesečni bilten I/2024 (Statistical Monthly Bilten I/2024), March 2024, https://www.pio.rs/sites/default/files/Statistike/Bilten/2024/Statisticki_bilten_I_2024.pdf, 26.6.2024.

[25] Fond penzijskog i invalidskog osiguranja (Pension and Disability Fund), Prosečne penzije (Average pensions), https://www.pio.rs/sr/prosecan_iznos_penzije, 26.6.2024.

[26] Moraju da rade i u penziji: Koliko najstarijih građana ide na posao, https://n1info.rs/biznis/posao-za-penzionere/, 26.6.2024. This is very rough estimate, since there is no official statistics.

[27] According to the 2022 Census in Serbia, there were 1.468.885 people aged 65 and more (https://popis2022.stat.gov.rs/sr-latn/5-vestisaopstenja/news-events/20230525-starost-i-pol/); according to the Pension and Disability Fund, in January 2024 there were 1.092.982 users of pensions (disability and family pensions excluded). However, there are many pensioners aged 65+ who receive disability pensions and are not qualified for old age pensions regardless of their age (they do not have enough years of paid contributions). So, the estimate of 150.000 people is very approximative since this number may be significantly higher.

[28] Nikola Vojnović, Evo kolika je minimalna penzija u Srbiji, koju prima skoro 140.000 penzionera, https://www.blic.rs/biznis/moj-novcanik/evo-kolika-je-trenutno-minimalna-penzija-u-srbiji/0xv20lh#:~:text=Ako%20planirate%20da%20se%20penzioni%C5%A1ete,60.000%20dinara%20ima%C4%87e%2034.001%20dinar., 26.6.2024.

[29] In 2024, women are eligible for retirement at age 63 years and 8 months with a minimum of 15 years of insurance contributions. This age requirement will be progressively raised to align with men’s retirement age of 65 by 2032. See: https://www.pio.rs/sr/starosna-penzija

[30] ILOSTAT, https://www.ilo.org/shinyapps/bulkexplorer59/, 26.6.2024.

[31] Astrov, V., Leitner, S., Mara, I., Podkaminer, L.,Weinberger-Vidovic, H. (2020): Wage developments in the Western Balkans, Moldova and Ukraine, Research Report No. 444, The Vienna Institute for International Economic Studies (wiiw), Vienna.

[32] Ibidem.

[33] Law on Social and economic Council, Official Gazette of the Republic of Serbia, no. 125/2004.