Management of Employment law: legal aspects of establishing and termination of employment in Serbia 2023

Employment procedure and relationship in Serbia

The lack of manpower and therefore the great competition on the labor market in attracting quality employees on the one hand and increasingly complex regulations and increased supervision in the field of labor law on the other, point to the increasing importance of knowledge and adequate application of labor law matters in order to represent your company as a desirable employer on the labor market who fulfills all his obligations in accordance with the regulations. The importance of the proper management of labor relations is shown by the fact of the growing number of labor disputes that employees initiate against employers. In addition to the above, more and more emphasis is being placed on employee rights and business compliance with the provisions of the Labor Law, as well as other laws that regulate labor law matters. Because of the above, and in order to make sure that your company has the title of a desirable employer, it is extremely important that you respect all obligations, but also that you are familiar with the most important institutes.

Bearing in mind the above, we have prepared this guide so that you can familiarize yourself with the basic obligations and procedures in the employment process, compliance with work discipline by the employee, termination procedures and the possibility of mediation in labor disputes. In the text below, you will have an insight into the most important procedures and steps that need to be taken in order to make sure that your business complies with legal obligations, and our team of lawyers in the field of labor law is always at your disposal for detailed information.

Introduction to Employment relations management

As we have already pointed out, harmonizing the labor aspect of your business is of great importance for the development of your business. What is in the focus of every business is the people that are in the center of it, and the labor-legal aspect of every business has become crucial in order for one to develop its business.

It is your and your company’s responsibility as an employer to ensure that the labor aspect of your business is fully compliant with positive legislation. The Labor Law foresees in many cases the legal responsibility of the employer in connection with the respect of the rights of employees. The Labor Law recognizes many situations in which employees are provided and guaranteed certain rights, and it is the employer’s responsibility to enable the employee to enjoy the aforementioned rights through his business. On the other hand, employees also have an obligation to respect work obligations and work discipline, and in the event of non-compliance, the employer has available mechanisms related to the termination of the employment relationship.

In the following, familiarize yourself with the most important institutes with reference to the establishment of an employment relationship, compliance with work discipline and work obligations of employees, termination of the employment relationship and resolution of labor disputes through mediation.

Employment procedure and employment agreement in Serbia

Employment procedure and employment contract

The whole employment process can be quite stressful, tiring and full of legal issues. After the need to employ an additional number of people in certain positions has arisen, and after you have published a job ad that you are hiring, the next step is to organize an interview with the candidates to get to know them and assess whether the candidates meet the criteria required for the open position. Take care that the Rulebook on Organization and Systematization of the Workplace prescribes the criteria for each workplace, so based on the candidate’s application as well as the interview, you should check whether your potential future employee meets all the criteria.

After you have agreed on the terms of cooperation with the potential candidate, the next step is to conclude an employment contract. The employment contract must be concluded in writing and signed by the employer and the employee. The employment contract itself states the employee’s starting date, and from that date the employee begins to exercise all rights and obligations arising from the employment relationship. Keep in mind that you are obliged to inform the employee, before starting date, in writing about the prohibition of abuse at work and the rights, obligations and responsibilities of the employee and the employer in connection with the prohibition of abuse.

The employment contract that you conclude with the employee can be concluded for an indefinite or definite period of time. In case that employment contract is concluded for a definite period of time, it must be stated what is the ground, i.e. the objective reasons, for concluding a fixed-term employment contract (stating the objective reasons for concluding ). It is mandatory to indicate in the employment contract whether the employment relationship is based on a fixed or indefinite period.

In addition to the above, the Labor Law prescribes mandatory elements of the employment contract that must be included in order to define the employment relationship as clearly and precisely as possible. If your new employee is a person with no work experience, you can arrange a probation period. Probation period is a period during which the employee should demonstrate appropriate work and professional abilities, otherwise the employment relationship ends on the day the probation period expires. Probation period can last for a maximum of six months, and during this period, that is, before the end of the probationary period, the employee and the employer can terminate the employment contract with a notice period that cannot be shorter than five working days. In case you terminate the employment contract during probation period, you shall be obliged to give reasons for termination of employment contract. Because of the above, if a probation period is stipulated, you need to adequately monitor the work of the employee and assess whether she/he has the appropriate work skills in order to continue working even after the end of the probation period.

Employment agreement in Serbia

It is extremely important that the employment contract be comprehensive, and that it regulates the rights and obligations from the employment relationship in a detailed and clear manner. In addition to the above, depending on the industry to which your business belongs, there are certain clauses that are extremely useful to include in the employment contract, such as a non-competition clause. However, when contracting such clauses, it is very important to formulate them carefully and precisely, so that they actually have application in practice. It often happens that certain specific clauses are not formulated in an adequate way, and as a result they do not provide the protection for which they were initially incorporated into the employment contract.

Further, it is important to state precisely and in detail what the employee’s work obligations consist of and what they all include. The best way to do this is to list the work tasks that the employee is required to perform within his workplace. In this way, the employer can more easily monitor the work performance and fulfillment of the employee’s work obligations, while the employee will know exactly what his work tasks are.

In addition to the fact that it is extremely important to conclude a meaningful, precise and clear employment contract, many labor aspects are defined in the Rulebook. The Rulebook is a general act enacted by the employer that comprehensively regulates certain rights and obligations that apply to all employees.

Finally, it is important to keep in mind that the Labor Law expressly prohibits discrimination, both of persons seeking employment and of employees. In this sense, during the selection of candidates, you should take care that discrimination is strictly prohibited in relation to the conditions for employment and the selection of candidates. Certainly, even after the establishment of an employment relationship, the prohibition of discrimination also applies to education, training, advancement at work, as well as in relation to the termination of an employment contract.

Managing of the employment relationship in Serbia

Management of work performance and compliance with work discipline

As we have stated, it is of great importance to specify precisely and in detail the work tasks and duties of the employee, in order to effectively monitor the execution of work employee’s performance. Certainly, in practice there are many programs and tools which can helps employer to monitor the performance of employees and evaluate whether the employee has the necessary knowledge and abilities to perform the tasks stipulated for his job position.

In the event that the employee does not achieve work results or does not have the necessary knowledge and skills to perform the tasks he is working on, the Labor Law gives the employer the opportunity to terminate the employment contract. However, this termination reason entails a separate termination procedure. The termination procedure in question is reflected in the employer’s obligation to give the employee a written notification regarding deficiencies in his work, instructions and an appropriate deadline for improving his work. The Labor Law does not prescribe an appropriate deadline for improving work, but leaves it up to the employer to decide. When determining the appropriate deadline, it is important to take into account the length of the employment relationship and determine an adequate deadline that will be left to the employee to improve work results. Only if the employee does not improve the work results within the given period, the employer can cancel the employment contract. In order to be sure that the legal procedure has been followed in its entirety and that all necessary steps have been taken, be sure to consult with your legal advisor.

On the other hand, if due to technological, economic or organizational changes the need for the work of one or some employees ceases, the Labor Law also recognizes the possibility of termination of the employment relationship due to the aforementioned factors. In this case too, it is necessary to comply with the legal procedure and take all the necessary steps in a timely manner in order to be sure that the dismissal procedure is carried out in a legal manner. Otherwise, there is a high probability that the (former) employee will initiate a dispute before the competent court for annulment of the dismissal decision. In this sense, if you are in the role of an employee who wants to protect his rights before the court, you have the possibility to initiate a dispute within 60 days from the date of delivery of the disputed decision by which it is decided on your rights and obligations. Before starting a dispute, it is very important to consult with your lawyer and collect all the necessary documents.

Mediation in employment relationships in Serbia

Mediation in resolving labor disputes

Although a large number of labor disputes end up in court, this is not the only way to resolve them. The procedure before the court can take a very long time, and it can be exhausting for both the employer and the employee. Although it is the primary mechanism for the protection of rights used by the employees, there are also alternative ways of resolving labor disputes – mediation.

Mediation is a procedure in which the parties try to resolve the dispute through negotiation with the help of one or more mediators. Through mediation, the parties reach an agreement regarding legal and factual issues, and the procedure itself is strictly confidential. The above means that all proposals presented by any party are confidential and cannot be used in court, arbitration or other proceedings, nor can they be communicated to third parties in any other way. What is very important to know is that the mediation process itself can be initiated by the parties before or after the initiated court proceedings. Therefore, if the employee initiated a labor dispute before the court, the above is not an obstacle to start the mediation procedure and to end the dispute amicably. On the other hand, as the Labor Law prescribes a special deadline for filing a lawsuit, it should be borne in mind that this deadline does not run while the mediation procedure continues, but not longer than 60 days. Therefore, if the mediation procedure was initiated before the expiration of the deadline for filing a lawsuit, the specified deadline will not run, but not longer than 60 days. In this way, the legislator wanted to indicate that the mediation procedure is urgent and that the parties should strive to reach an agreement in a short period of time.

In case the parties reach an agreement, a written dispute resolution agreement is drawn up. The aforementioned agreement can have the status of an enforceable document on the basis of which enforcement proceedings can be initiated, but only if certain conditions are met. In order to make sure that your rights and interests are protected in the mediation process, it is important that you have a reliable legal advisor during the entire process who will guide you through the entire process.

Employment compliance in Serbia

As the entire field of labor relations is complex and very important for compliance and business development, it is very important that you have a reliable partner and legal advisor who will provide adequate legal support. Our team of lawyers consists of experts in the field of labor law who have years of practice and providing legal assistance to both employers and employees. Different aspects of perceiving legal problems in the labor matters allow our team to have a unique approach to solving each problem.

If you want to harmonize your business in an appropriate way or you need legal support when exercising your rights from the employment relationship, contact us by clicking on the link.

This article is for informational purposes only and does not constitute legal advice. If you need additional information regarding the topic in question, please feel free to contact us by email at or by phone at +381677049551.

Nemanja is attorney at law and founder of the law firm NCR Lawyers. Additionally, Nemanja is on the permanent list of arbitrators for the Commodity Exchange in Novi Sad and is also a member of the Belgrade Arbitration Center.

In his career, Nemanja has been involved in numerous complex legal transactions and has collaborated with clients from various industries. Dynamic and innovative in finding the best solutions for clients, Nemanja primarily focuses on corporate law, dispute resolution, and arbitration. Additionally, Nemanja’s legal expertise includes the protection of intellectual property for both domestic and international clients.

He completed his undergraduate and master’s studies at the Faculty of Law, University of Belgrade. Part of his master’s studies was completed at the Europa Institute in Saarbrücken as part of the Erasmus+ program.

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