Law on Employment of Foreigners

LAW ON AGENCY EMPLOYMENT OF FOREIGNERS
(“Official Gazette of the Republic of Serbia”, No. 86/2019)

Scope

​

Article 1
This law regulates the rights and obligations of employees who enter into an employment contract with a temporary employment agency for the purpose of being seconded for temporary work to a user employer, under the conditions stipulated by this law; the equal treatment of seconded employees in terms of exercising certain rights arising from employment and from work; conditions for the operation of temporary employment agencies; the manner and conditions of seconding employees; the relationship between the agency and the user employer; and the obligations of the agency and the user employer toward seconded employees.
This law applies to all seconded employees, regardless of the type of employment relationship or working hours.
For all matters not regulated by this law, the law governing labor applies.

​

Definitions

​

Article 2
A temporary employment agency (hereinafter: the Agency) is a business entity or entrepreneur registered with the competent authority in the territory of the Republic of Serbia, which establishes an employment relationship with an employee for the purpose of temporarily seconding that employee to a user employer in the territory of the Republic of Serbia to perform tasks under the supervision and management of the user employer.
A seconded employee is a physical person who is in an employment relationship with the Agency in accordance with this law and the labor law, and who is seconded to a user employer for the temporary performance of tasks under that employer’s supervision and management, in accordance with this law.
A user employer is a legal entity, entrepreneur, or a representation or branch of a foreign legal entity registered in accordance with the law in the territory of the Republic of Serbia, a state body, a body of an autonomous province or a local self-government unit, unless otherwise determined by this law, under whose supervision and management the seconded employee temporarily performs tasks, in accordance with this law.
A comparable employee is an employee who is in an employment relationship with the user employer and performs or would perform the same tasks in terms of the required level and type of education (qualification), specific knowledge and abilities, competencies, complexity, responsibility, work experience and other special conditions for the job.
If the user employer does not have a comparable employee in the same job, the seconded employee cannot be assigned a lower base salary than that of the comparable employee at the same level of education or qualification.
Secondment is the period in which the employee temporarily performs tasks at the user employer’s site under its supervision and management.
Basic terms of employment and work are:

1. Terms established by the labor law, collective agreement, or internal work regulations applied by the user employer, or by the employment contract of the comparable employee, which pertain to working time, overtime, night work, rest during working hours, daily and weekly rest, annual leave and other absences, state and other holidays, remuneration for performed work and time spent at work (hereinafter: salary), salary allowances and allowances for costs of commuting, meal allowances during work, vacation pay, travel time in domestic and foreign business trips, accommodation and subsistence allowances when working in the field, funeral services (hereinafter: cost allowances), in accordance with the labor law;

2. Conditions established pursuant to the occupational safety and health law.

3. ​

CONDITIONS FOR AGENCY OPERATION

​

Article 3
The Ministry responsible for labor affairs (hereinafter: the Ministry), upon request of a business entity or entrepreneur registered in the register of business entities under the law, issues a license to operate for the Agency (hereinafter: the License), under the following conditions:

1. That the legal representative of the business entity or entrepreneur, or the employee authorized to conclude contracts under Articles 9 and 11 of this law, holds higher education from undergraduate academic studies amounting to at least 240 ECTS credits, or a master’s degree, or specialized academic studies, or specialized vocational studies, or basic studies lasting at least four years or specialized studies at a faculty, and has passed the professional exam for operating a temporary employment agency;

2. That the business entity or entrepreneur meets the spatial and technical conditions for operation.
   Within eight days from the date of receipt of the License, the business entity or entrepreneur must file an application for registering the activity (78.20 Temporary Employment Agency) or other human resource leasing (78.30 Other Human Resource Leasing) and the trade name under which the activity “Temporary Employment Agency” will be listed, in accordance with the law governing registration of business entities.
   The business entity or entrepreneur cannot engage in the activity in paragraph 2 of this Article before registering the activity in accordance with the law, nor can it list that activity without a previously issued License.

3. ​

Article 4
A physical person who has been finally convicted by a court judgment for a criminal offense in labor relations, for bribery, for embezzlement, or for which an unconditional prison sentence of at least six months has been imposed, cannot establish an Agency, be a member, or lawful representative of the Agency.
An Agency whose License has been revoked may not perform the activity under Article 3, paragraph 2 of this law for three years from the date of revocation.
An Agency which, as determined by an inspection authority, has carried out secondment operations without a License under Article 3, paragraph 1, may not be granted a License within three years from the date of that act.

​

Article 5
Supervision in the procedure of determining fulfillment of the conditions for the Agency’s operation, in relation to the application of Articles 3–8 of this law, is exercised by the labor inspectorate.
For taking or retaking the professional exam for operating Agencies, as well as issuing the certificate of passing the exam, a state administrative fee is paid in accordance with the law on administrative fees.
The professional exam for operating Agencies is taken before the appropriate commission formed by the minister responsible for labor (hereinafter: the Minister).
Commission members are entitled to remuneration for their work.
The Minister prescribes spatial and technical conditions for Agency operation, the conditions of professional competence of the person referred to in Article 3, paragraph 1 item 1), the program, content, manner of taking the professional exam for operating temporary employment agencies, and the amount of remuneration for the Commission members.

​

Article 6
The License is issued for a period of five years.
The License may be renewed under the same conditions under which it is granted, provided that the renewal request is submitted no later than 30 days before the expiration date of the License.
For issuing and renewing the License, as well as for changing the seat of the Agency, the applicable state administrative fee is paid in accordance with the law on administrative fees.
The Ministry maintains a registry containing:

1. Data on Agencies (name, seat, registration number, VAT number);

2. The number and date of issuance, renewal, revocation, and expiration of Licenses, and dates of commencement and end of validity;

3. Other data important for keeping records of Agencies.
   An Agency that has been issued a License is obliged to notify the Ministry in writing of changes that affect the performance of secondment operations within eight days from the occurrence of the change.

4. ​

Article 7
The License is revoked from an Agency:

1. If it ceases to fulfill the conditions of Article 3 of this law;

2. If the situation from Article 4, paragraph 1 of this law occurs;

3. If within one year the Agency is found liable for offenses on multiple grounds or in an amount exceeding twice the maximum prescribed fine, and the labor inspectorate determines that the Agency evidently violates the rights of seconded employees, or continuously breaches this law.
   The Ministry issues a decision on revocation of the License upon proposal of the competent authority or ex officio if conditions from paragraph 1 are met or other conditions under the law.
   An Agency whose License is revoked may not perform secondment operations or conclude new employment contracts for secondment.
   An Agency whose License is revoked under paragraphs 1 item 2) or 3) of this Article may have it reissued after the lapse of three years from the revocation date.
   Employment contracts concluded before the License is revoked remain valid until the end of the secondment, but no longer than two months from the license revocation date.

4. ​

Article 8
The License ceases to be valid:

1. Upon expiration of the term referred to in Article 6, paragraph 1;

2. At the request of the Agency for termination of validity;

3. Upon deletion of the business entity performing secondment from the register of the competent authority.
   An Agency may request termination of validity if it provides proof that it has paid salaries, salary allowances, and cost allowances to seconded employees in accordance with Article 2, paragraph 7 of this law.
   The procedure for issuance, revocation, and termination of the License and keeping records is governed by the law on administrative procedure.
   The Minister prescribes more detailed conditions and methods of issuing, revoking, and terminating the License.

4. ​

CONDITIONS FOR SECONDMENT OF EMPLOYEES

Employment relationship

​

Article 9
The Agency may enter into an employment contract with a seconded employee either for an indefinite period or for a fixed term equal to the time of secondment to the user employer, in accordance with this law and labor law.
The contract referred to in paragraph 1 is concluded in the name and on behalf of the Agency by a person who meets the conditions in Article 3, paragraph 1 item 1) of this law.
A fixed-term contract referred to in paragraph 1, which equals the duration of secondment, or attachments thereto, is delivered to the employee prior to secondment and contains, besides elements required under labor law, the following conditions:

1. The trade name and seat of the user employer and data on the person authorized to represent the user employer to seconded employees;

2. The place of work at the user employer;

3. Name and description of tasks to be performed by the seconded employee;

4. Duration of secondment and the basis for secondment under Article 16;

5. Start date at the user employer;

6. Amount of base salary, elements for determining base salary, performance pay, increased salary, and salary allowances;

7. Duration of daily and weekly working time at the user employer;

8. Duration of annual leave to which the employee is entitled, or if it cannot be determined at secondment moment, the method of granting and determining paid annual leave.

9. ​

Article 10
If secondment is to a user employer in an EU or EEA member state, the contract under Article 9 must also contain:

1. Duration of work abroad;

2. Currency in which salary will be paid;

3. As needed, other monetary and non-monetary benefits related to stay abroad;

4. As needed, conditions governing return of the seconded employee to the Republic of Serbia.
   Paragraph 1 does not apply if the work abroad does not exceed one month.

Secondment contract between Agency and user employer

​

Article 11
The contract of secondment between the Agency and the user employer must be in writing and must include:

1. The obligation of the user employer to provide to the Agency before secondment accurate information on:
    (1) the number of seconded employees required,
    (2) the time period of secondment and the basis for secondment under this law,
    (3) the work location of seconded employees,
    (4) tasks to be performed by the seconded employees,
    (5) working condition data for the tasks being seconded,
    (6) basic working conditions from Article 2, paragraph 7;

2. The manner and deadline in which the user employer must provide the Agency data for salary calculation, remuneration and cost allowances;

3. Data on the person authorized to represent the user employer vis-à-vis the Agency and the person authorized to represent the Agency vis-à-vis the user employer (these may be changed by unilateral notice);

4. Data on the person at the user employer authorized to interact with seconded employees;

5. The fee for services the Agency provides the user employer and other mutual rights and obligations of the Agency and user employer;

6. Other matters relevant to rights and obligations of seconded employees and arranging mutual relations between Agency and user employer.
   The contract under paragraph 1 is concluded in the name of the Agency by a person who meets conditions under Article 3, paragraph 1 item 1) of this law.

7. ​

Article 12
If the user employer is in an EU or EEA state, the secondment contract also includes:

1. Provisions of that member state applicable to the employment relationship of the seconded employee;

2. Provisions of the Republic of Serbia applicable to that employment relationship;

3. Right to return costs to Serbia.

4. ​

Article 13
A secondment contract may not be concluded:

1. To replace an employee at a user employer who is on strike, except if the employee designated to work during the strike to maintain minimum operations refuses;

2. For tasks from which the user employer has declared a surplus of employees under labor law;

3. For seconding to another Agency;

4. In tasks where the user employer has introduced reduced working hours or special pension conditions;

5. In public service positions or local government civil servant roles;

6. Where the user employer is legally required to conduct a public competition to establish a fixed-term contract.
   By law or collective agreement, use of agency workers may be restricted to protect seconded employees, workplace safety, labor market stability, and prevent abuse.
   The user employer must inform the Agency of circumstances in paragraphs 1 and 2 when concluding the secondment contract.

7. ​

Article 14
The total number of seconded employees under fixed-term contracts at a user employer must not exceed 10% of that employer’s total number of employees as of the contract signing date or contract amendment.
If a user employer has fewer than 50 employees on the contract signing date, they may engage:

1. One seconded employee if they have 2–9 employees;

2. Two if 10–19 employees;

3. Three if 20–29 employees;

4. Four if 30–39 employees;

5. Five if 40–49 employees.
   Seconded employees under indefinite contracts are not counted in these limits.
   Seconded employees under fixed-term contracts for peak workload in public fund–using employers count toward these limits under relevant laws.

6. ​

Article 15
Provisions of contracts or acts that prohibit or prevent establishing an employment relationship between user employer and seconded employee after secondment do not have legal effect after secondment expires.

​

Article 16
The Agency may second an employee under a fixed-term contract only in cases and for durations allowed under the labor law.
The Agency may not second an employee under a fixed-term contract to the same user employer if they were previously so seconded (directly or via another Agency) for a total period exceeding 24 months, unless fixed term work is lawfully allowed longer.
If a seconded employee remains at the user employer at least 5 working days after the secondment period ends or was engaged contrary to above, they are deemed to have formed an indefinite employment contract with the user employer.
These rules in paragraphs 1–3 do not apply to employees in indefinite contracts with the Agency.

​

Article 17
A person working on the premises of a user employer, but employed by another employer under contract, is considered seconded by that user employer, unless proven otherwise.
Responsibility for work contrary to this law lies with both original employer and user employer.

​

WORKING CONDITIONS OF THE SECONDED EMPLOYEE

​

Article 18
During secondment, the seconded employee is entitled to the same working conditions as the comparable employee at the user employer, under this law.
These equal conditions include:

1. Duration and scheduling of working time;

2. Overtime;

3. Night work;

4. Rest breaks, daily, weekly rest, and annual leave;

5. Paid leave absence by law, collective agreement or work rules;

6. Elements for calculating salary, allowances, and cost reimbursements under Article 2, paragraph 7;

7. Occupational safety and health;

8. Protection of pregnant women and nursing mothers;

9. Protection of young persons;

10. Prohibition of discrimination on all grounds under law.
    The user employer ensures equal conditions, and the Agency ensures calculation and payment of salary, allowances, and cost reimbursements.

11. ​

Article 19
The Agency must deliver a work instruction to the seconded employee before secondment, unless the fixed-term contract already includes these instructions as required under Article 9 paragraphs 3 and 4.

​

Article 20
The user employer must maintain records of attendance and absence of seconded employees and provide the Agency with data for salary and cost reimbursements by the 15th of the month for the previous month.
The Agency must pay the seconded employee for the secondment period based on such data and the records supplied by the user employer.
If the user employer fails to provide data, the Agency must pay salary and reimbursements based on its own data or average monthly hours.

​

Article 21
During work at the user employer, the seconded employee must conscientiously perform tasks, comply with organization of work, and fulfill other obligations as per labor law.

​

Article 22
The Agency must not charge the seconded employee for the secondment service or for concluding an employment contract with the user employer after secondment ends.
This prohibition does not apply to service fees charged between the Agency and the user employer under the secondment contract.

​

Article 23
The Agency may terminate or take measures against the seconded employee for justified reasons relating to work ability or conduct, under labor law and internal acts.
The user employer must immediately notify the Agency in writing and provide evidence for termination reasons.
In case of unlawful termination, the seconded employee may file a labor suit against the Agency for compensation up to the remaining contracted period (max 18 salary installments) and right to unpaid taxes and contributions.

​

Article 24
If the Agency has a contract of indefinite duration with the seconded employee, that employee is entitled to compensation between secondments and severance pay in case of termination due to surplus staff, per labor law.
Such compensation may not be less than the minimum wage (or pro rata for part-time).

​

Obligations of the user employer

​

Article 25
The user employer must assign tasks, organize, supervise, instruct the seconded employee, and ensure safe working conditions under occupational safety law.

Article 26
The user employer must:

1. Provide the Agency with information about job conditions and conditions of comparable employees when concluding the secondment contract, and notify changes promptly;

2. Inform seconded employees about vacant positions so they may compete for indefinite contracts;

3. Allow seconded employees use of meal areas, childcare facilities, and organized transport under same conditions as its own employees unless objective reasons exist;

4. Notify the safety and health officer of seconded employees and tasks;

5. Provide the trade union at the user employer with information about seconded employees’ work engagements as it does for its own employees.
   The user employer is jointly liable with the Agency for obligations to seconded employees under Article 2, paragraph 7.
   The user employer is responsible for accuracy and completeness of data under paragraph 1 item 1.

6. ​

Article 27
The user employer must provide occupational safety and health measures, acquaint the seconded employee with job risks and measures, and arrange medical examinations per occupational safety law.
The seconded employee must follow prescribed safety measures, especially for specific risks.

​

Article 28
The user employer must report any work injury or occupational disease of a seconded employee in accordance with safety and health law and immediately inform the Agency.
The user employer must supply the Agency with a completed report form within 24 hours of the injury/disease discovery.
The Agency must submit a report in accordance with safety law.

​

Article 29
The Agency and the user employer must ensure protection of personal data of seconded employees under data protection law.
The user employer must maintain written or electronic records of seconded employees and Agencies with which it has secondment contracts, containing:

1. Name and personal ID number (JMBG);

2. Start and end dates of employment;

3. Basis for secondment if employee is on fixed-term contract;

4. Required education, qualification, knowledge, competencies, experience and other special work conditions;

5. Job title;

6. Employment status in the Agency (fixed or indefinite);

7. Details of the Agency (name, seat, registration number, VAT).
   The user employer must process this data in compliance with data protection law and retain for at least 50 years.

8. ​

COLLECTIVE RIGHTS OF SECONDED EMPLOYEES

​

Article 30
Seconded employees count toward the total number of employees for determining eligibility for employee representatives under law.
Seconded employees at the Agency and user employer are guaranteed freedom of union organization, activity, and collective bargaining.
They may participate in strikes at the user employer under conditions prescribed by labor law.

​

Article 31
Collective agreements may negotiate conditions improving opportunities for seconded employees to train, access childcare services in periods between secondments, and training at the user employer under the same terms as its employees.

​

COMPENSATION FOR DAMAGE

​

Article 32
A seconded employee is liable for damage caused at work intentionally or by gross negligence, in accordance with labor law.
If the seconded employee causes damage to a third party and the user employer compensates the damage, the employee must reimburse the user employer.
If a seconded employee suffers damage at work, the user employer must compensate them under labor law.
Subsidiary liability of the Agency and user employer applies in relation to work injuries and occupational disease.

​

Article 33
The user employer must compensate a seconded employee for injury or occupational disease.
The Agency is subsidiarily liable if the seconded employee cannot fully or partially collect compensation from the user employer via legal proceedings.

​

SUPERVISION

​

Article 34
Supervision of the law’s application is carried out by the labor inspectorate or administrative inspection.

​

PENAL PROVISIONS

Offenses

​

Article 35
A legal entity that performs secondment operations is fined between 800,000 and 1,500,000 Dinars for offenses such as:

1. Performing secondment without a License or registration (Article 3);

2. Failing to notify the Ministry of changes (Article 6 paragraph 5);

3. Continuing secondment after License revocation (Articles 7 & 8);

4. Not entering into employment contracts or in violation of law (Articles 9 & 10);

5. Not entering into secondment contracts or violating those laws (Articles 11 & 12);

6. Entering secondment contracts contrary to bans and limits (Articles 13 & 14);

7. Prohibiting establishment of employment contracts contrary to law (Article 15);

8. Seconding employees contrary to law (Articles 16 & 17);

9. Failing to ensure equal working conditions (Article 18);

10. Failing to provide instructions (Article 19);

11. Failing to pay salary, allowances, costs (Article 20 & 24);

12. Charging seconded employees unlawfully (Article 22);

13. Unlawfully terminating contracts (Article 23);

14. Failing to pay severance (Article 24);

15. Failing to report injuries/occupational disease (Article 28);

16. Failing to protect personal data (Article 29).
    An entrepreneur performing secondment is fined 200,000 to 400,000 Dinars.
    Responsible individuals in a legal entity are fined 50,000 to 100,000 Dinars.

17. ​

Article 36
A user employer legal entity is fined 800,000 to 1,500,000 Dinars for offenses such as:

1. Not concluding secondment contract or doing so unlawfully (Articles 11 & 12);

2. Concluding secondment contract contrary to bans/limits (Articles 13 & 14);

3. Employing seconded employees contrary to law (Articles 16 & 17);

4. Failing to ensure equal conditions (Article 18);

5. Failing to maintain or provide records (Article 20);

6. Not fulfilling obligations under Articles 25–27;

7. Failing to report injury/disease or provide forms (Article 28);

8. Failing to protect data (Article 29);

9. Acting contrary to collective rights (Article 30).
   Entrepreneurs are fined 200,000 to 400,000 Dinars; responsible persons 50,000 to 100,000 Dinars.

10. ​

Transitional and Final Provisions

Article 37
Provisions of Articles 10 and 12 apply to secondment to user employers located in EU/EEA states from the date Serbia obtains full EU membership.

​

Article 38
Restrictions on user employers, Agencies, and employees in Article 16 apply to secondment contracts, employment contracts, and instructions concluded or issued from the law’s implementation.

​

Article 39
Upon entry into force, user employers and Agencies may continue secondment only under conditions and manner established by this law.

​

Article 40
The Minister shall issue implementing regulations for Article 5 paragraph 5 and Article 8 paragraph 4 by December 31, 2019.

​

Article 41
This law enters into force on the eighth day from its publication in the Official Gazette, and is applicable from March 1, 2020, except for Article 40 and related provisions, which apply upon entry into force, and other provisions of Articles 3–8 which apply from January 1, 2020.