Staff Leasing Regulated For The First Time In Serbia

December 2019 - After more than 15 years since staff leasing was introduced in practice in Serbia, the Serbian parliament finally adopted the first law regulating this type of hiring - the Staff Leasing Law (the "Law").

The implementation of the Law requires companies that are using this type of hiring to change their budgets and business models, to change their systematisation of jobs and internal policies on benefits and awards, and to renegotiate their arrangements with staff leasing agencies. However, the deadline for such all-encompassing changes is apparently too soon, as the Law takes effect from 1 March 2020.

In this article we will present the most important new requirements introduced by the Law, areas requiring special attention, and an overview of the problems we expect in practice.

Limitations related to headcount

According to the Law, leased staff will need to be employed by the staff leasing agency, and this can be both unlimited-term and fixed-term employment.

If a user of staff leasing services takes on agency employees who are employed for an unlimited period of time, there are no limits when it comes to the maximum number of hired agency staff. However, if a user of staff leasing services would hire agency employees who are employed at the agency based on a fixed-term employment contract, it can only hire:

one agency employee, if it has a headcount of two to nine employees; two agency employees, if it has a headcount of 10-19 employees; three agency employees, if it has a headcount of 20-29 employees; four agency employees, if it has a headcount of 30-39 employees; five agency employees, if it has a headcount of 40-49 employees; or 10% of the total headcount as agency employees, if the headcount exceeds 50 employees. Limitation related to period of engagement

According to the Law, an agency employee who is employed by an agency for an unlimited period of time can work for the same user of staff leasing services for an unlimited period of time.

On the other hand, an agency employee who is employed by the agency based on a fixed-term employment contract can work for the same user of staff leasing services up to 24 months in total, regardless of how long the breaks between certain work periods last and also regardless of whether the user of staff leasing services used different staff leasing agencies to hire the same person.

If the same agency employee continues to work for the user of staff leasing services after the...