Which Labour Code – the old or the new one – should apply?

Following the adoption of the Labour Code, in practice, many issues still in relation to its implementation and application. For example, how should the employer act if a notice of dismissal is given to the employee before the new Labour Code takes effect and the employment contract is terminated after its entry into force, or how long will collective agreements entered into before the new Labour Code be valid? 

The general rule establishes that labour relations that exist on the effective date of the new Labour Code will be subject to the provisions of the new Labour Code, except for the following cases:

• if an employee was given a written notice of dismissal or en employee gave a notice of or requested termination of the employment contract without any fault on the employee’s part prior to the effective date of the new Labour Code, the employee shall be dismissed in accordance with the provisions applicable prior to the entry into force of the new Labour Code;
• if a complaint or application for examination of an individual labour dispute is submitted or an action concerning the exercise of labour rights is filed prior to the effective date of the new Labour Code, such complaint or application shall be handled in accordance with the provisions applicable before entry into force of the new Labour Code;
• disciplinary procedures initiated prior to the effective date of the new Labour Code shall be completed in accordance with the provisions applicable before entry into force of the new Labour Code. 

It should also be note that: 

• employers whose average number of employees on the effective date of the new Labour Code is 20 or more shall, within 6 months following the entry into force of the new Labour Code, form a commission on the election of a labour council by issuing an order in accordance with the procedure laid down in the new Labour Code;
• collective agreements concluded before the effective date of the new Labour Code shall be valid in accordance with the provisions of legal acts applicable before entry into force of this law, however, not longer than until 30 June 2018;
• as of the effective date of the new Labour Code, the annual leave to which a person becomes entitled before entry into force of the new Labour Code shall be granted on working days – 5 working days of the annual leave for 7 calendar days of leave (in the case of a 5-day working week) or 6 working days for every 7 days of leave (in the case of 6-day working week). Employees who, before the effective date of the new Labour Code, have outstanding leave entitlement for more than 3 years of work shall be have the right to use it by 1 July 2019. 

Aspects of validity of different types of employment contracts 

After taking effect of the new Labour Code new employment contracts shall be concluded in accordance with the procedure laid down in the new Labour Code. However, the question is how, for example, valid short-term employment contracts, contracts for secondary employment or teleworking contracts, which are excluded from the new Labour Code, should be treated? The following aspects of validity should be distinguished with regard to certain types of employment contracts: 

• short-term employment contracts concluded before the effective date of the new Labour Code will continue and be subject to the provisions of fixed-term employment contracts;
• contracts for secondary employment concluded before the effective date of the new Labour Code will continue and be subject to the provisions of fixed-term or open-ended employment contracts;
• teleworking contracts concluded before the effective date of the new Labour Code will continue and be subject to the provisions of fixed-term or open-ended employment contracts and the provisions of the Labour Code on teleworking;
• on the effective date of the new Labour Code and thereafter several employment contracts concluded between the employer and the same employee will remain valid provided that the main employment contract is determined and an agreement on additional functions is made, and such contracts shall be subject to the provisions of the new Labour Code regarding an agreement on additional work. Unless the parties determine which function is main or additional, the function on which the parties agreed first shall be regarded as the main function. 

Existing labour relations that are better reflected by a new type of an employment contract provided for in the new Labour Code may be subject to the new provisions of the Labour Code, and, by agreement of the contracting parties, existing employment contracts may be modified with the new employment contracts consistent with the substance of labour relations.  

Aušra Maliauskaitė-Embrektė, Associate Partner, law firm GLIMSTEDT