Employment 2024 Comparisons

There is no formal distinction between blue-collar and white-collar workers in Slovenia. The Slovenian law is generally employee-friendly and determines a rather wide scope of minimal rights that need to be provided to all employed persons – ie, persons working based on an employment contract.

However, the law allows certain deviations from the mandatory provisions of the law (ie, minimum employee rights) with regard to the legal representatives of employers and executive workers. A special regime also applies to so-called public employees.

Employers' Legal Representatives

The Slovenian Employment Relationships Act (Zakon o delovnih razmerjih, Official Gazette no 21/13 et seq – “ZDR-1”) allows deviation from the minimum rights and obligations set forth therein for managing directors of the company and (registered) proxy holders – ie, employees who have a corporate mandate in addition to their employment contracts.

With these employees, the employer can agree on a regime deviating from ZDR-1 with regard to the following rights and obligations:

• the term of the contract (it is usually linked to the term of the mandate of such employee);
• working hours and provisions on breaks and rest periods;
• remuneration of work;
• disciplinary responsibility;
• termination of the employment contract; and
• the applicability of collective bargaining agreements for such employees.

In practice, employers prefer to reach all-in agreements with such employees, by which they agree on a fixed compensation for work provided under such agreement (which is not possible for other employees, even executives). The flexibility with regard to the termination of the employment agreement is also important, as it allows the parties to deviate from the rather strict and formalistic termination regime set forth in ZDR-1 for all other categories of workers.

Executive Employees

Certain deviations from the minimum rights set forth in ZDR-1 are also allowed for executive employees, albeit to a lesser extent than for legal representatives of the employer. Executive employees are employees who manage a business area or an organisational unit of the employer and are authorised to make independent decisions about either personnel or the organisation of work in their respective department or legal transactions. It is important that the executive employees have such competences not just “on paper”, as the agreements on deviations from the minimum rights set forth by ZDR-1 will otherwise not be valid.

A special regime applies to the duration of such contracts, as they can be concluded for a fixed term (even if they do not fall into any other categories that permit the conclusion of fixed-term agreements, as listed in 1.2 Employment Contracts) if such executive employee is already employed with the employer for an indefinite term in a non-executive position to which the employee will be able to return after their employment agreement for an executive position terminates.

Further deviations from the minimum rights are permitted with regard to working hours, night work and rests and breaks, provided that the executive employee has certain independence with regard to the organisation of their working hours or if their working hours cannot be planned in detail in advance (due to the nature of the position) and under a further condition health and safety at work are ensured. To a certain extent, employers can also agree with such employees that the contractual monthly salary will encompass work over and outside of regular working hours.

Difference Between Indefinite and Fixed-Term Employment Contracts

Employment contracts for an indefinite term are the “standard” under Slovenian law, whereas fixed-term contracts are regulated as exceptions, which can only be concluded in cases and under conditions stipulated in ZDR-1. See 1.1 Employee Status for details on some of the exceptions.

Written Form of Employment Contracts

The law requires an employment contract to be concluded in written form. The employer is obliged to present a written proposal to the employee at least three days before its signing and a signed copy after it has been concluded.

The lack of written form does not necessarily mean that no employment relationship has been concluded. The written form is stipulated in favour of the employee. If the employee claims that an employment relationship exists between the parties, the employer will bear the burden of proof that no such relationship exists in case of dispute.

ZDR-1 sets forth the mandatory elements of an employment contract. With regard to certain rights and obligations, the employment contract can also refer to collective bargaining agreements or general regulations of the employer. The statutory content includes:

• information on the contracting parties;
• the date of commencement of work;
• the employee’s position and a detailed job description;
• the place of work;
• the term of the contract and (if applicable) the reason for concluding a fixed-term employment contract;
• an indication of whether the employment contract is for full-time or part-time work;
• working hours and the distribution thereof;
• the amount of the employee's basic salary and any other payments to which the employee is entitled;
• the payment of allowances and other components of the employee's salary, the pay period, payday and the method of salary payment;
• the duration of annual leave;
• the length of notice periods;
• training provided by the employer;
• reference to the binding collective agreements or the employer's general acts determining the working conditions of the employee; and
• other rights and obligations in specific cases.

Employment Contracts for an Indefinite Term

If the duration of the employment contract is not specified in writing or if the fixed-term employment contract is not concluded in accordance with the law, it is presumed that the employment contract has been concluded for an indefinite period.

Under Slovenian law, employment agreements may only be terminated in cases and in accordance with the conditions and procedures set forth by ZDR-1 (with the exception of employment agreements with legal representatives, as described in 1.1 Employee Status).

Fixed-Term Employment Contracts

As mentioned above, fixed-term contracts are viewed as “unwanted exceptions” by the law, as the social security of workers is still a very important value in Slovenia. In exceptional cases, an employment contract may be concluded for a fixed term if it pertains to:

• the performance of work that, by its nature, lasts for a specified period;
• the replacement of a temporarily absent worker;
• a temporary increase in the volume of work;
• the employment of a foreigner or a stateless person;
• a managerial person or a procurator or other leading worker;
• the performance of seasonal work;
• a worker who concludes a fixed-term employment contract for the purpose of preparing for work, training, improving for work or education;
• fixed-term employment due to work during an adaptation period;
• the performance of public works or inclusion in active employment policy measures;
• work organised as a project;
• work required during the introduction of technical and technological improvements of the work process or due to the training of workers or the transfer of work;
• elected and appointed officials or other workers tied to the mandate of a particular body or official; or
• other cases defined by law or by a collective agreement at the industry level.

Collective bargaining agreements may grant further exceptions, particularly to smaller employers (those employing ten or fewer employees).

As fixed-term agreements are viewed as “irregularities”, ZDR-1 also limits their duration. In general, they are limited (for the same position) to the duration of the underlying reason for which such exception was permitted, but not more than two years. Several exceptions apply. If the fixed-term agreement was concluded or extended contrary to the law, the employee has the right to seek its conversion into an agreement for indefinite term.

Special Types of Employment Agreements

Apart from the distinction between indefinite and fixed-term contracts and contracts with managerial and executive employees on one hand and regular employees on the other, ZDR-1 also regulates some other specific types of contracts, such as:

• those for the employment of agency workers;
• agreements with self-employed, economically dependent persons who are personally performing work for the contracting entity based on a civil law agreement (and receiving 80% of their annual income from the same contracting entity);
• those relating to student work and work of children above the age of 15 (work under this age limit is permitted only exceptionally); and
• special regimes that apply to posted workers.

The law determines that an employment relationship shall be deemed to exist between parties if their relationship has all the elements of an employment relationship, even if neither of the parties wishes to conclude an employment relationship. This often applies to student work (where students work under comparable circumstances to employed workers) and civil law contracts between self-employed persons and companies, as the parties often opt for such arrangements for tax reasons.

Full-Time Work

Full-time working hours must not exceed 40 hours per week. Exceptions apply to employment agreements with legal representatives and executives (see 1.1 Employee Status).

Specific laws or collective bargaining agreements can also determine shorter full working hours for individual industries or positions, but not less than 36 hours per week, except for positions with higher risks of injury or health impairments.

Distribution of Working Hours

As a rule, the working hours are evenly distributed, with the “national standard” still being five days per week and eight hours per day (including a paid break of 30 minutes per eight hours). The parties can agree on a different distribution of working hours. In an even distribution of working hours (meaning that the regular number of working hours is the same every week), the working hours cannot be distributed to fewer than four or more than six days a week.

The law also sets forth conditions under which the working hours can be unevenly distributed or temporary redistributed (and limitations with regard to daily and weekly breaks, which need to be considered). In an uneven distribution of working hours, the weekly working hours may not exceed 56 hours and the employer needs to ensure that the working hours are evened out within a certain reference period, not longer than six months (unless extended by a collective bargaining agreement).

The employer must determine the annual schedule of working hours (annual calendar) and notify employees (and workers’ unions if they exist on the employer’s level) in writing beforehand. The parties can also agree that the specific monthly/weekly working hours will be determined by periodic calendars, determined by the employer (in accordance with all applicable agreements and limitations). Even if the working hours are distributed unevenly, this does not mean that the employer can determine the working hours/schedules ad hoc, as the employees have the right to foreseeability of working hours in order to be able to plan their private lives.

Special categories of workers (disabled workers, older employees, certain categories of parents, etc) enjoy protection, which prevents the employer from ordering them to work more than 40 hours per week (meaning that uneven distribution of their working hours is not possible if they are employed full time) or to work overtime hours.

ZDR-1 further regulates the right of employees to propose a different allocation of working hours for the purpose of balancing the professional and private life of employees. The employer must reply to such request in writing and justify their refusal.

Overtime Work

Overtime work is viewed as an “extreme measure” by ZDR-1, and may be requested only in cases when the employer cannot ensure the unhindered work process with less intrusive measures. In other words, the employer is not allowed to continuously request overtime work if this could be avoided by better organisation of work, new employments, etc.

Extraordinary and unforeseeable circumstances under which overtime work is allowed include exceptional cases of increased workload, pending damages or danger to people and goods, aversion of defects that could lead to work interruptions and similar situations.

If possible, overtime work shall be ordered in writing before it commences. If not, then it can be assigned orally, although a written justification of the overtime work must be provided to the employee by the end of the week following the performed overtime work, at the latest.

Overtime work may last a maximum of eight hours per week, 20 hours per month and 170 hours per year. The working day may last a maximum of ten hours. Daily, weekly and monthly time limits may be observed as average limits over a period specified by law or a collective bargaining agreement, and this period must not exceed six months. With the consent of the worker (given for each individual case), overtime work may exceed 170 hours, but it must not exceed 230 hours per year. When assigning overtime work, the statutory provisions on daily and weekly rest periods must be considered.

The employer cannot assign work beyond full-time working hours to specific groups of employees, such as pregnant workers, older workers, minor workers, workers in bad health whose health condition could deteriorate due to such work, workers with full-time working hours shorter than 36 hours per week due to work in a position with higher risks of injury or health impairments, or disabled workers working part-time.

Part-Time Contracts

An employment contract may also be concluded for working hours shorter than full-time. Such an employee has the same contractual and other rights and obligations arising from the employment relationship as an employee who works full-time and exercises them (with some exceptions) proportionally to the time for which the employment relationship was concluded (eg, the employee is entitled to proportional annual leave of a minimum duration and to holiday pay).

Specific and temporary part-time contracts are also regulated by laws determining the special rights of parents, disabled employees, etc.

Minimum Salary Requirements

Compensation for work under the employment contract consists of a salary, which must always be in monetary form, and other types of payments (if agreed upon). In determining the salary of a worker who works full-time, the employer must adhere to the minimum salary requirements, annually determined by the Minister for work (in 2024, the minimum salary amounts to EUR1,253.90 gross for full-time). Collective bargaining agreements often set forth higher minimum basic salaries for individual categories of jobs.

Basic Salary, Supplements and Variable Part

A salary consists of:

• a basic salary, which is the agreed monthly compensation for the agreed number of working hours and expected results of work;
• supplements for seniority and special circumstances of work; and
• a variable part of the salary (bonus) for the individual and collective performance (if applicable at the employer).

The salary needs to be agreed in a gross amount.

Employees are entitled to a special seniority allowance, the amount of which is determined by collective branch bargaining agreements – most commonly, the employees receive 0.5% of their basic salary for every completed year of their work experience. Other supplements are also determined by collective bargaining agreements and apply to special working conditions, such as overtime work, night work, work in shifts, work on Sundays and other work-free days, etc. The supplements are calculated from the basic salary.

The criteria for bonuses for individual or collective job performance are determined by collective bargaining agreements on the level of the industry or the employer or by the employer’s general acts, and are usually not a mandatory part of the employee’s salary. Provided that the employer meets the conditions set forth by Article 44 of the Personal Income Tax Act (Zakon o dohodnini, Official Gazette no 13/11 et seq – “ZDoh-2”), the bonus for the collective performance is not subject to personal income tax (up to a certain threshold).

Employees are entitled to a paid daily break of 30 minutes per eight hours of work (or a proportionally longer or shorter paid break if the daily working hours were longer or shorter).

Vacation Allowance

Every employee is entitled to a vacation allowance. The minimum annual vacation allowance equates to the minimum salary. The vacation allowance is not subject to any taxes or social contributions up to the amount of the last published average gross salary in Slovenia. In cases where an employee starts or ends their employment with the employer during the year, they are entitled to a pro rata part of the vacation allowance.

Work-Related Expenses

Employers are responsible for reimbursing employees for all acknowledged work-related expenses, the amount of which is usually determined by collective bargaining agreements and/or a governmental decree on thresholds up to which these payments are not subject to taxes (and social contributions). These reimbursements include the daily meal allowance, costs of commuting to and from work, travel costs and compensation for use of the employee’s assets (if the employee works from home).

Vacation

Employees in Slovenia are entitled to a certain number of paid days of vacation (annual leave). Annual leave in a given calendar year cannot be less than four weeks, regardless of whether the employee works full-time or part-time. A longer duration of annual leave may be determined by collective bargaining agreements, general employer’s acts or the employment contract. Annual leave is determined and used in working days. The employer is obliged to notify the employee in writing each year (by March 31st) of the number of vacation days to which the employee is entitled.

Annual leave may be taken in several parts, and the employer is obliged to allow the employee to use two weeks of annual leave in one piece. The specific dates on which the annual leave will be taken are subject to an agreement between the parties, but the employer must consider the personal circumstances of the employee (particularly if the employee has younger children) and shall not refuse the employee’s requests unless the use of annual leave on a certain date would seriously hinder the employer’s work process.

The employer must enable employees to take their annual leave in the current calendar year, and employees must take at least two weeks of annual leave by the end of the current calendar year, with the remaining leave to be taken by June 30th of the following year (extensions apply in case of longer absences from work due to sick leave or parental leave).

Other Permitted Absences From Work

Paid and unpaid absences from work for personal reasons are permitted.

An employee is entitled to paid leave from work for up to seven working days in a calendar year due to personal (non-health-related) circumstances explicitly listed in Article 165 of ZDR-1. Absence from work due to illness or injury and absence due to blood donation are also paid. The duration of such paid absence is not limited, but only a certain part of the compensation burden falls on the employer.

The recent amendments to the law have introduced up to five working days of paid absence in a calendar year for the purpose of providing care to close relatives, as listed in ZDR-1 (ie, caregiver leave). An employee who is a victim of domestic violence is entitled to five working days of paid leave in a calendar year for the purpose of arranging protection, legal and other procedures, and addressing the consequences of domestic violence.

Confidentiality and Non-disparagement Requirements

An employee has a general obligation to refrain from any actions that materially or morally harm or could harm the business interests of the employer, given the nature of the work performed for the employer. In addition, the employee must not use for personal purposes or disclose to a third party the employer's trade secrets, which are designated as such by the employer, and which were entrusted to the employee or became known to the employee in another way. There are no specific statutory limitations for confidentiality and non-disparagement agreements in this regard.

Slovenian labour law recognises statutory non-compete prohibition and contractual non-compete clauses. The first apply to the duration of the employment agreement and prohibit the employee from engaging in any activities that might be competitive to the employer’s business during the employment (exceptions are subject to employer’s explicit approval), while the latter apply only if they have been explicitly and validly agreed upon in the employment contract and apply to the post-employment period.

If a statutory prohibition of competitive activities is breached during the employment, the employer may claim compensation for damages caused by the employee's actions within three months from the day the employer became aware of the violation but not later than three years from the completion of the work or the conclusion of the transaction.

A (post-)contractual non-compete clause may be agreed upon in writing for a period not exceeding two years after the termination of the employment contract, and only for cases of termination of the employment contract by mutual agreement between the parties, due to regular termination by the employee or termination for cause by the employer.

If compliance with the non-compete clause prevents the employee from earning an income comparable to their previous salary, the employer must pay the employee a monthly monetary compensation for the entire duration of the prohibition. The monetary compensation for compliance with the non-compete clause must be stipulated in the employment contract, and must amount to at least one-third of the employee's average monthly salary in the last three months before the termination of the employment contract. If the monetary compensation for compliance with the non-compete clause is not stipulated in the employment contract, the non-compete clause is not valid.

The employer and the employee may mutually agree to terminate the validity of the non-compete clause. If the employee terminates the employment contract because the employer has seriously breached the terms of the employment contract, the non-compete clause ceases to be valid if the employee provides a written declaration to the previous employer that they are not bound by the non-compete clause, within one month from the termination of the employment contract.

The legal representatives of the employer may be subject to additional non-compete obligations in accordance with the provisions of Slovenian corporate law. These restrictions are separate from the non-compete obligations under employment law and are not commented on in detail here.

The aim of non-solicitation clauses is to prevent employees from actively recruiting their colleagues from their (former) employers. Such contractual clauses are relatively rare in employment contracts and are usually agreed upon only with managerial workers and executives. It is questionable whether they would be enforceable in case of dispute, as Slovenian employment law allows for a rather limited number of restrictions, pertaining to the post-contractual obligations of an employee.

Such clauses might also be agreed upon with an employer’s business partners (customers). As they are not regulated by Slovenian employment law and do not directly impose any obligations on the employees, such clauses cannot prevent an individual from accepting employment with a company that has agreed on such a clause with the employee’s former employer. It is even questionable whether the customer bound by such a clause could refuse to employ the employee if they were the most suitable candidate for an open position.

The General Data Protection Regulation (GDPR) applies in the employment sphere. IN addition, the national Personal Data Protection Act (Zakon o varstvu osebnih podatkov, Official Gazette no 163/22 – “ZVOP-2”) regulates video surveillance of official, work or business premises and within workspaces.

Operators of video surveillance systems in the public and private sectors may conduct video surveillance of access to official, work or business premises if it is necessary for the safety of people or property, to ensure control of entry into or exit from these premises, or if the nature of the work poses a potential risk to employees. Before introducing video surveillance in a public or private sector entity, the employer must consult with the representative trade unions at the employer and the works council or employee representative.

The implementation of video surveillance within workspaces may only be conducted when it is absolutely necessary for the safety of people or property, for the prevention or detection of violations in the area of gambling, or for the protection of classified information or trade secrets, and when these purposes cannot be achieved by less intrusive means. It is prohibited to record workstations where an employee usually works, except when it is necessary in the circumstances mentioned above. Direct monitoring of camera footage is permitted only if it is carried out by expressly authorised personnel of the operator.

In all instances, employees must be notified in writing in advance of the implementation of video surveillance.

If foreign workers want to work in Slovenia, they require a work permit and employment authorisation. Foreign workers are citizens of third countries – ie, countries that are not members of the European Union or European Economic Area. Conditions for the employment, self-employment and work of foreigners, as well as related tasks of the Republic of Slovenia for regulating and protecting the labour market, are regulated in the Employment, Self-Employment and Work of Foreigners Act (Zakon o zaposlovanju, samozaposlovanju in delu tujcev, Official Gazette no 47/15 et seq – “ZZSDT”). Usual conditions relate to:

• passing a labour market test to determine if suitable candidates registered as unemployed at the Employment Service of Slovenia are available;
• having a clean criminal record; and
• demonstrating sufficient means of subsistence for their stay in Slovenia.

Foreign workers can apply for the following permits and authorisations:

• a single permit (a combined residency and work permit) for employment, with subtypes including an EU Blue Card, an EU ICT permit and a single permit for seconded workers and daily migrant workers;
• work permits under the various bilateral agreements (eg, with Bosnia and Herzegovina or Serbia);
• posted worker notification from another EU member state;
• short-term work notification (a visa may be required for entry);
• short-term legal representative work notification (a visa may be required for entry);
• a business visit permit (no permit or notification is required if conditions are met, although a visa may be necessary for entry); and
• various other types of visas.

Various administrative simplifications were enacted in April 2023, including:

• simplifying the process of changing employers, changing positions with the same employer, or employment with two or more employers within the framework of a valid single permit for residence and work;
• easing the employment of foreigners who will be employed by public sector employers; and
• allowing applicants for international protection to integrate into the labour market more quickly.

There are no registration requirements for employers seeking to hire foreign workers. However, a foreign citizen can only enter an employment contract in Slovenia if they meet the conditions for obtaining a work/single permit, and they cannot begin working until the permit is issued; any employment contract signed with a foreign citizen who does not hold a valid permit is considered null and void. Employers are allowed to hire only those foreign workers who possess valid work permits. The application for a work permit can be submitted by either the employee or the employer.

Depending on the severity of the violation, employers who are fined for an offence may be prohibited from hiring or working with foreign nationals for one to five years.

Due to the severe delays at the administrative units for issuing work/single permits for foreign workers in recent years, in 2024 the legislature passed some de-bureaucratisation measures aimed at speeding up the administrative processes, such as the elimination of local jurisdiction for issuing single permits for residence and work.

The location of work is an essential element of the employment contract. The parties can agree on remote work or a hybrid arrangement (which is customary), but this requires:

• an amendment of the employment agreement;
• notification of work at home to the Employment Inspectorate; and
• a prior assessment of the suitability of the remote workplace with regard to the health and safety at work requirements.

These formalistic requirements often prevent the parties from agreeing on more flexible forms of remote work (where the employee could, for example, freely choose their daily workplace). These and additional considerations (eg, recognition of minimum employee rights of the host country) also apply in cases where the employee would temporarily work in other jurisdiction(s).

Furthermore, ZDR-1 has recently introduced the so-called “right to disconnect”, which obliges employers to undertake measures aimed at ensuring employees are aware of their right not to monitor emails or other telecommunications during their breaks, rests and other off-work times, which further limits the flexibility of such arrangements.

The relative complexity of such relationships often leads to employees deciding to become self-employed and to conclude a civil law agreement with their (previous) employer.

Sabbatical leave (as a longer absence from work) is not explicitly regulated by Slovenian laws and is also not common on the market.

Due to the very shallow labour market and increasing competition for high-performing workers, some employers are introducing such measures and are introducing their own systems with regard to sabbatical leave. Some opt for temporary suspension of the employment (meaning that the agreement remains in force but the employer does not pay any remuneration to the employee for the term of suspension), others pay only social contributions to the employee for such term, and some pay the employee their full salary for such term.

Agreements on mutual rights and obligations are usually regulated in individual agreements and on occasions also by an employer’s internal regulations.

Desk Sharing

Desk sharing is becoming popular due to the high rents for office spaces. It is not specifically regulated in Slovenian legislation and is often not even regulated in individual employment agreements but is rather applied as an employer’s organisational measure in combination with hybrid work.

Platform Work Challenges

Platform work challenges have become a hot topic, particularly with regard to platforms providing deliveries of foods and other products, as the scope of these services and workers soared during the pandemic and throughout the related restrictions.

Many of these workers are foreigners, who are not even aware of their rights and do not know the local language well (which is also a consumer protection topic, as they deal with consumers). They usually work based on civil law contracts and would generally be entitled at least to the protection granted to economically dependent self-employed persons (see 1.2 Employment Contracts), as they commonly receive more than 80% of their income from the same entity.

Recent concerns with regard to such workers also pertained to the liability of the employer/contracting entity if such workers cause an accident (eg, traffic accident) or commit a violation of the laws while working. In the case of employed workers, the damaged party/authorities can act against the employers, which is usually easier than acting against an individual employee.

It goes without saying that such workers are often also subject to other abuses (which is, however, more related to them being foreigners than to the platform work as such).

Use of Artificial Intelligence

The use of various AI tools is becoming more and more common in various industries and the EU has already introduced the first regulations regulating this area. It is yet to be seen how these acts will be implemented into national legislation and introduced, as this is a totally new area.

Challenges related to the use of AI are numerous and expand well beyond the legal issues.

Role of Trade Unions

In Slovenia, trade unions are defined as organisations where workers voluntarily unite to protect and improve their social and economic position and rights from and within their employment. Trade union freedom allows for the free establishment and operation of trade unions and the right to join them.

The Trade Union Representativeness Act (Zakon o reprezentativnosti sindikatov, Official Gazette no 13/93 – “ZRSin”) sets the conditions for acquiring legal personality and representativeness of trade unions. A trade union acquires legal personality on the day of the issuance of a decision on the custody of its statute, with competent authorities keeping the statutes based on the area and activity.

Trade unions still have a lot of influence in Slovenia, as they hold the right to organise strikes, serving as a powerful means to exert pressure on employers and advocate for the demands and rights of their members. The right to strike is guaranteed in Article 77 of the Constitution, with the possibility of legal restrictions if required by public interest, considering the type and nature of the activity.

Furthermore, trade unions in individual industries (branches), professions or companies are entitled to negotiate collective bargaining agreements with their employer counterparts. If the trade union is representative (on the level of the industry, profession or company, or even at the national level), it is allowed to conclude collective bargaining agreements that apply to all employees in the respective industry, profession or company (ie, the level for which the collective bargaining agreement was concluded). If a trade union is organised in the company, the employer cannot unilaterally regulate through its internal regulations employees' rights and obligations that are the subject of collective bargaining agreements.

Unions further play a crucial role in the processes of business transfers and collective layoffs, as well as individual terminations (if they affect their members).

Representative Status of Trade Unions

Representative trade unions are those that are democratic, independent from state bodies and employers, primarily financed by membership fees, and have a certain percentage of members based on the industry, activity or profession. Trade union representativeness is divided into sectoral unions, activity unions and professional unions, where representativeness is crucial for the conclusion of collective agreements and participation in bodies that decide on the economic and social security of workers. A confederation of trade unions represents an association of unions from various sectors, activities or professions.

The status of representativeness on the level of an industry (branch) is obtained through a decision issued by the minister based on legal conditions; such decision is published in the Official Gazette. Since ZRSin does not provide for periodic verification of the conditions for representativeness, the employer may only challenge the trade union's authority for collective bargaining stemming from trade union representativeness in a collective labour dispute.

A trade union organised on the level of the company becomes representative once a certain percentage of employees (15%) joins the trade union, provided that all other conditions for representativeness (as stated above) are met.

Workers have a constitutional right to participate in the management of economic organisations and institutions, as regulated by Article 75 of the Constitution, where the details and conditions are specified by law. The Law on Worker Participation in Management (ZSDU) sets out the methods and conditions for workers' participation in the management of economic companies, regardless of ownership type, as well as sole proprietors with at least 50 employees, and co-operatives.

Worker participation is realised through the following means:

• the right to initiate proposals and to receive responses to those proposals;
• the right to be informed;
• the right to provide opinions and suggestions and to receive responses to them;
• the possibility or obligation of joint consultations with the employer;
• the right to co-decision; and
• the right to veto employer decisions.

Comparison to Trade Unions

Unlike trade unions, works councils are primarily designed to engage in co-management rather than in employment relations that establish rights and obligations within employment relationships. Works councils only take on the role of trade unions in employment matters under certain exceptional circumstances, as outlined by ZDR-1, particularly when no trade union exists at the employer. This generally means that works councils do not address workers' rights and obligations related to employment, such as salaries or working conditions (and they are prohibited from doing so if a trade union is active within the company). Instead, they serve as the representative voice for workers in the management and business decision-making processes of the company.

The Law on Collective Bargaining Agreements regulates the parties involved, the content, the process of concluding a collective bargaining agreement and its form, validity and termination, as well as the peaceful resolution of collective labour disputes, and the record-keeping and publication of collective agreements. A collective agreement may only include provisions that are more favourable for workers than the statutory provisions, with some exceptions as specified in ZDR-1.

Parties to and Contents of Collective Agreements

Collective agreements are concluded between trade unions or associations of trade unions on behalf of workers and employers or employers' associations on behalf of employers. They consist of:

• an obligational part that regulates the rights and obligations of the parties who signed the agreement, and may also address methods for the peaceful resolution of collective disputes; and
• a normative part that contains provisions regulating the rights and obligations of workers and employers in employment contracts, during the employment relationship, and in relation to the termination of employment contracts, payment for work, other personal earnings and reimbursements related to work, health and safety at work, and other rights and obligations arising from relationships between employers and workers, as well as ensuring conditions for trade union activities at the employer.

Types of Collective Agreements

There are several types of collective agreements, such as sectoral agreements (eg, the Collective Agreement for Non-Economic Activities), industry agreements (eg, the Collective Agreement for the Healthcare and Social Care Activities of Slovenia) and professional agreements (eg, the Collective Agreement for Doctors and Dentists in the Republic of Slovenia).

A collective agreement applies to the parties to the collective agreement and their members. If the signatories to the collective agreement include associations of trade unions or employers' associations, the collective agreement specifies which members of the association it applies to. A collective agreement binds the parties to the agreement and their members even if a signatory withdraws from the association, but for no longer than one year.

General and Extended Validity of Collective Agreements

When a collective agreement is concluded by one or more representative trade unions it is granted a general validity, meaning that it applies to all workers at an employer, or employers covered by the agreement.

When a collective agreement is concluded by one or more representative trade unions and one or more representative employers' associations whose members employ more than half of all workers employed by the employers for whom the extension is proposed, it is granted extended validity by the Minister of Labour, meaning that the validity of the entire collective agreement or part of it is extended to all employers in the activity or activities covered by the agreement.

After the termination of a collective agreement's validity, the provisions of the normative part (see above) continue to apply until a new agreement is concluded, but for no longer than one year, unless the parties agree otherwise.

Collective labour disputes are resolved peacefully through negotiations, mediation and arbitration, and before the competent labour court.

When an employer terminates an employment contract, they are required to provide a justification (already in the termination). The list of reasons for which an employer is allowed to terminate an employment agreement is limited, and the termination procedures are subject to rather strict formal requirements.

Conversely, a worker may terminate the employment contract without providing any justification in the case of an ordinary termination, whereas a justification is required in cases when the employee terminates the employment agreement for cause and without a notice period (extraordinary termination).

Termination by the Employer – Permitted Termination Grounds

An employer can terminate an employment contract only based on one of the following grounds specified by ZDR-1 (numerus clausus principle):

• business reasons;
• the employee’s incompetence/inability to perform the contractually agreed work;
• a material breach of obligations in the employment relationship;
• an unsuccessful probation period; or
• the inability to perform work as stipulated in the employment contract due to disability.

Under certain conditions, an employee’s material breach of contractual obligations can even represent a ground for extraordinary termination by the employer – ie, a termination without any notice period. Extraordinary termination is possible in cases where the violations are so severe that the employer cannot reasonably be expected to continue the employment relationship until the end of the notice period. The severity of the violation is a legal standard that needs to be assessed on a case-by-case basis, but extraordinary terminations are usually issued in cases of criminal offences against the employer, intentional violations of most important obligations that could cause material damage to the employer, violations of sick leave regimes, failure to show at work for several days without a reason, etc.

Certain categories of workers enjoy special protection against ordinary termination, which needs to be considered in the termination proceeding (certain parents, disabled persons, older employees, trade union representatives, employees on sick leave, etc).

Termination Procedure

The procedures for termination vary depending on the grounds for termination. ZDR-1 regulates the mandatory elements of the termination letter, as well as how it needs to be served. It needs to be emphasised that the employer’s termination always needs to contain a justification therefor. The termination needs to be as detailed as possible (particularly with regard to the relevant facts), as the court assessment of the termination – in case the employee decides to file a lawsuit challenging the termination – is always limited only to the termination reasons stated in the termination, meaning that the employer is later prevented from justifying the termination with any reasons that were not stated in the termination.

Collective bargaining agreements or even an employer’s internal regulations often regulate individual types of termination procedures in more detail.

For termination based on business reasons, the employer needs to prepare a written termination containing justified reasons for termination and serve it to the employee in accordance with the law. The business reasons must be such that the employer will be able to prove their existence in case of a legal dispute. Although the courts are not allowed to assess the business decisions of the employer (and thus assess whether a decision leading to termination is economically sound, necessary, prudent, etc), in case of dispute the employer will still need to prove that the reasons for termination actually existed and explain why the work of the terminated employee has become redundant.

Employees are entitled to the mandatory notice periods (or longer if contractually agreed) and to a statutory severance pay, which depends on the length of the employee’s employment with the employer and their average salary prior to the termination.

For termination due to an employee’s incompetence, the employer needs to monitor the employee’s work for a certain period and, based on this, prepare a written justification of the termination summarising their findings. “Employee’s incompetence” means that the employee is not able to provide the contractually agreed performance because they are not performing their work with the expected level of quality, professionalism or on time, or no longer meet the statutory job requirements. The termination reasons cannot be based on an employee’s health issues, and termination for incompetence does not come into question when the employee’s non-performance is based on the employee’s violation of obligations in the employment relationship.

As in the case of termination due to the employee’s fault (ie, breach of obligations in the employment relationship), the employee needs to be invited to a hearing (at least three business days before the scheduled hearing) in which they are allowed to present their statement with regard to the termination reasons and also the evidence in their favour. After the hearing, the employer decides on whether the termination will be issued or not. If the employer proceeds with the termination, the termination must also contain the employer’s position on the main arguments provided by the employee during the hearing or in the employee’s written statement. The termination cannot be issued later than six months after the employer became aware of the employee’s incompetence.

In the case of termination due to incompetence, the employee generally has the right to the same notice period and severance pay as in the case of termination for business reasons.

For termination due to the employee’s fault (material breach of contractual obligations), the employer must first issue a written warning within 60 days of discovering the violation, and no later than six months after the violation occurred, informing the employee that their employment contract can be terminated if they conduct similar or other material violations of the employment agreement within six months after receiving the warning letter. This period can be extended to up to 18 months by collective bargaining agreements for the respective sector.

The written warning needs to be justified (in the same way as the termination). After receiving the written warning, the employee can request the employer to allow them to present their arguments in a hearing, and the employer must schedule a hearing within 30 days from receiving such request (but not sooner than three working days afterwards). Based on such hearing, the employer adopts a final decision on the warning letter.

An issued (and justified) warning letter is a precondition for a later ordinary termination of the employee’s employment agreement due to the employee’s fault, whereas the later material violation must be committed within a “probation period” stated in the warning letter. For the termination, the employer must issue a separate written accusation and invite the employee to a hearing where the employee can present arguments and evidence in their favour. After the hearing, the employer decides whether to proceed with issuing the termination notice. The same 60-day/six-month deadline applies as for the warning letter.

In the case of extraordinary dismissal due to fault reasons (described in more detail in 7.3 Dismissal for (Serious) Cause), no previous warning letter is required. This termination ground is reserved for the most material violations only. In such cases, the employer must act very quickly, as the termination must be issued within 30 days after the competent representatives of the employer learn of the termination reasons and not later than six months after the respective violations occurred. Also in this proceeding, the employee has a right to a hearing (based on previous confrontation with the accusations against them), except where the nature of the violations is such that the employer cannot reasonably be expected to grant the employee a hearing (in cases of personal assaults, longer absences from work without cause, etc).

In the case of termination due to the employee’s fault, the employee is not entitled to severance pay. A 15-day notice period applies in the case of ordinary termination for fault reasons.

In the case of an employee’s termination for ordinary reasons (without case), no special formal requirements apply. The termination needs to be in writing and served to the employer. The notice period cannot be longer than 60 days, except in the termination of an employer’s legal representatives, for which different notice periods can be agreed upon.

In the employment contract, the worker and the employer may agree on a probationary period of six months at most, during which time the worker may terminate the employment contract with seven days' notice. If the employer determines during or at the end of the probationary period that the worker has not successfully completed the probation, the employer may terminate the employment contract with seven days' notice.

Termination by Operation of Law

The employment contract terminates by operation of law in the following two circumstances:

• on the date the worker is served with a decision confirming a Category I disability or the decision granting the right to a disability pension becomes final; or
• on the date of expiration of the single permit or the seasonal work permit, if the employment contract is concluded by a foreigner or a stateless person.

Mass Dismissals

Special rules apply to mass layoffs (ie, situations when an employer plans to dismiss a certain number of employees within a 30-day period) when they affect:

• at least ten employees if the company has between 21 and 99 employees;
• at least 10% of employees if the company has between 100 and 299 employees; or
• at least 30 employees if the company has 300 or more employees.

In such situations, the employer must inform and consult with a recognised trade union and a works council, if they exist within the company. The subject of these consultations is mostly the criteria by which the employer will determine (individual) redundant employees and measures for preventing the loss of employment and those easing the loss of employment (and other elements of the redundancy programme).

While the employer is obliged to discuss the redundancy programme with the above-mentioned employee representatives, it is not obliged to reach an agreement with them on this matter. However, an agreement is still recommendable, as the employer otherwise faces the risk of the employee representatives doing everything in their power to delay or even prevent the mass dismissal. After the consultations with the employee representatives (if applicable), the employer must also submit information on the redundancy programme to the Employment Service of Slovenia, which is also entitled to provide its own suggestions to the employer with regard to the measures proposed in the redundancy plan, which the employer must consider as far as possible.

If no trade union or works council exists in the company, the redundancy programme must be presented to all employees during a meeting. The employer may issue dismissal notices to the affected employees 30 days after notifying the Employment Service of Slovenia in writing about the redundancy plan. The Employment Service may decide to extend this 30-day period to 60 days, in which case the employer may only terminate the employment contracts 60 days after providing the required notification to the Employment Service as outlined above.

ZDR-1 determines the statutory notice periods that apply to various types of ordinary terminations. No notice periods apply for extraordinary terminations. The law sets forth minimum notice periods in favour of the employee, which can be extended either by collective bargaining agreements or by individual employment agreements.

The shortest notice periods apply to terminations during the probationary period, where either side can terminate the agreement with seven days' notice.

If the employee terminates the employment agreement outside of the probationary period, the notice period cannot exceed 60 days (unless a longer notice period is agreed upon with a legal representative of the employer). If no longer notice period is agreed upon by the parties, then the 15-day notice period applies if the employee has been employed for less than a year, and a 30-day notice period applies when the employee has been employed for more than a year with the employer.

When the employer terminates the contract for business reasons or due to employee incompetence, the notice period is 15 days for up to one year of service and 30 days for service exceeding one year. After two years of employment, the 30-day notice period increases by two days for each completed additional year of service, up to a maximum of 60 days. After 25 years of service, the notice period is 80 days, unless otherwise specified by a branch collective agreement, but it cannot be less than 60 days.

In cases of termination by the employer due to the employee’s fault, the notice period is 15 days.

Severance Payment

Employees are entitled to a statutory severance payment in the following cases:

• employer’s termination due to business reasons or incompetence;
• extraordinary termination by the employee (due to the employer’s fault); and
• lapse of a fixed-term agreement (with certain exceptions).

If the employee terminates the contract extraordinarily due to reasons attributable to the employer, the employee is entitled to a severance payment in the same amount as if the employee were terminated for business reasons. The employee is also entitled to compensation for the lost income during the notice period to which they would be entitled in case of termination for business reasons.

The severance pay is calculated based on the average monthly salary the employee received or would have received during the last three months prior to termination. The employee is entitled to severance pay calculated as follows:

• one fifth of the above-mentioned basis for each year of completed employment if employed for more than one year and up to ten years with the respective employer;
• one quarter of the basis for each year of employment if employed for ten to 20 years; and
• one third of the basis for each year of employment if employed for more than 20 years.

The statutory severance payment is capped at ten times the amount of the above-mentioned basis for the severance payment, unless a higher cap is determined in the collective bargaining agreement, employer’s regulations or the employment agreement.

The statutory amount of the severance payment is not subject to income tax and social contributions, up to the amount of ten times the average gross monthly salary in Slovenia. Any amounts exceeding this threshold or severance payments that go beyond the statutory rights are subject to income tax and social contribution.

See 7.1 Grounds for Termination and 7.2 Notice Periods.

Upon initiation of the extraordinary termination process, the employer may prevent the employee from performing work (suspension). During the suspension period, the employee is entitled to a compensation of salary amounting to 50% of the employee’s average salary for the previous three months.

An employee terminated due to said employee's fault is not entitled to severance pay, and their employment relationship ends the day after the termination notice is served, without any notice period. In the case of extraordinary termination due to an employee’s continuous absence from work, lasting at least five working days and if the employee has not notified the employer of the reasons for their absence, the employment relationship is terminated with the first day of such absence.

Each employment contract can be terminated by mutual agreement. Such an agreement must be in writing and must contain provisions informing the employee that they will not be able to exercise any social rights from unemployment, as the employee will become unemployed willingly. While failure to provide this notice does not invalidate the termination agreement itself, the employer may face fines for this omission.

The parties can agree on a voluntary severance payment and the conditions under which it will be paid, but such severance payment is subject to the same income tax and social contributions as the employee’s regular salaries.

In practice, mutual termination agreements are preferred by employers as they reduce the risk of the termination of the employment being challenged in front of the court. Such termination agreements are challenged (within one year from signing) only if either party signed it based on a misunderstanding, fraud or coercion, or in similar circumstances that would make the agreement challengeable under the general provisions of civil law.

Employees usually consent to such mutual termination agreements if the termination package is more favourable than what they are entitled to under statutory provisions or in cases where they would otherwise face a termination for fault reasons.

ZDR-1 regulates several categories of employees who enjoy protection against individual (but not all) termination grounds, based on their personal circumstances. The existence of such special circumstances needs to be checked by the employer prior to initiating a termination procedure. If the employee enjoys protection based on more than one circumstance, the most favourable protection regime for the employee applies.

Pregnant Workers and Parents on Leave

Pregnant workers, breastfeeding mothers of children not older than one year and parents on full-time parental leave are protected from termination during these periods, and for one month afterward. The law also prohibits employers from initiating any (even preparatory) steps against such employees during this period of protection, providing job security for expecting and new parents. Exceptions are termination due to extraordinary reasons by the employer and termination due to the winding-up of the employer, provided that the employer previously obtains the consent of the Employment Inspectorate for such termination.

Disabled Workers

Disabled workers also enjoy broad protection against termination. Their agreements can only be terminated in accordance with specific laws regulating the rights of disabled persons, except in cases of terminations due to the employee’s fault or due to the winding-up of the employer. The regular termination proceedings are rather lengthy and complex, and are subject to additional approvals by the competent authorities.

Employee Representatives

The law provides specific protections against termination for certain categories of employee representatives, including worker delegates, employee representatives in the supervisory board of the employer, and appointed or elected trade union representatives. Their employment contracts cannot be terminated without the consent of the works council, the employees who elected them or the trade union, except in cases of terminations due to the employee’s fault or due to the winding-up of the employer. This protection remains in place throughout their term of office and extends for an additional year after their term ends.

Organisations that have elected such employees also have relatively broad participation rights in such termination proceedings (and can oppose the termination), and can even request the suspension of termination for a certain period of time, etc.

Workers Approaching Retirement

For employees close to retirement, the employer is prohibited from terminating the contract for business reasons once the employee reaches age of 58 or has a limited time left (less than five years) to qualify for a pension without any deductions. However, this protection does not apply in certain cases, such as when compensation is provided through unemployment insurance for the remaining period or if suitable new employment is offered or if the employee provides their written consent to the termination.

Employees can contest wrongful terminations on the basis of procedural errors or due to the termination not being justified/founded. Terminations and any other situations where the employment agreement has ceased contrary to the law (eg, expiration of an illegally concluded fixed-term employment agreement, termination of a concealed employment relationship) may be subject to challenge.

Wrongful terminations can be challenged within 30 days after the employee receives such termination or since the employment ended based on any other illegal grounds.

Not every violation of termination proceedings results in the unlawfulness of such termination; the courts assess whether or not the procedural violation actually affected the outcome of the termination.

If the employee’s lawsuit is successful, the court may rule that the employment relationship never actually ended due to the unlawful termination. In such cases, the court can award the employee all rights from the employment relationship for the period since the unlawful end of the employment relationship until the finality of the decision, which can be a significant financial burden for the employer. The court can also order the employer to reinstate the employee.

If the court finds (based on the request of either party) that continuing the employment is impossible despite the dismissal being unlawful, it may establish the employment’s duration up to the issuance of the first-instance judgment, recognise the length of service, and award reasonable compensation. The compensation cannot exceed 18 months' salary based on the last three salaries of the employee. The compensation awarded depends on the length of employment, the employee’s prospects for future employment and the circumstances surrounding the termination. This compensation covers the rights the employee asserted up until the contract’s termination.

The income the employee received after the termination reduces the potential obligations of the employer, as described above. Potentially, a wrongful termination can also result in contractual penalties, liability for minor offences or even criminal liability of the employer.

Based on the constitutional principle of equality before law, any personal circumstance of a worker or a work candidate can be the ground for an anti-discrimination claim, and the Constitution and ZDR-1 explicitly list some of them.

Employers must ensure equal treatment and avoid any form of bias or prejudice in their employment practices. Direct and indirect discrimination based on any personal circumstance is prohibited.

In case of dispute, the burden of proof lies with the employer. Therefore, if in a dispute a candidate or employee presents facts that justify the presumption of a violation of the prohibition of discrimination, the employer must prove that the principle of equal treatment or the prohibition of discrimination was not violated.

If discrimination is proven, the following remedies are available:

• invalidating the termination and reinstating the employee if the dismissal was discriminatory;
• compensation that is effective, proportionate and dissuasive; or
• monetary compensation ranging from EUR500 to EUR5,000 under the Protection Against Discrimination Act.

Under the provisions of the Civil Procedure Act, which applies to labour and social disputes, there have been advancements in the digitalisation of employment disputes, including the option to conduct court proceedings via videoconferencing. As stipulated in the Act, parties can participate in hearings and carry out procedural actions remotely through audio and visual transmission (videoconference) if they mutually agree. This flexibility allows parties and their legal representatives to be in different locations while still actively participating in the proceedings. Nevertheless, in practice these options are not used as much as desired, as the videoconferencing requires the consent of all parties involved.

Courts may also utilise digital tools for gathering evidence, such as conducting onsite inspections, reviewing documents, hearing testimony from parties and witnesses, and consulting with court experts. There has long been an expectation that e-court files will be implemented in labour disputes, but these projects have not yet been introduced.

Specialised Courts

In Slovenia, four specialised labour and social courts serve as the first instance courts for resolving individual and collective labour disputes. The Ljubljana Higher Labour and Social Court serves as the second instance court, handling appeals against decisions made by the first instance courts. In labour disputes, the first instance court panel consists of a professional presiding judge and two lay judges (representing workers and employers).

Class Actions

According to the Collective Actions Act (Zakon o kolektivnih tožbah, Official Gazette no 55/17 et seq – “ZKolT”), a collective lawsuit with class action claims can be filed together by several workers filing independent lawsuits in individual labour disputes.

Court Representation

In proceedings before the courts of first and second instance, only attorneys or individuals who have passed the state bar exam may act as authorised representatives. In cases involving extraordinary legal remedies before the Supreme Court, a party may also be represented by a trade union representative, an association of insured persons or an employer's representative, provided that the representative is employed by the organisation to represent its members and has passed the state bar exam.

In Slovenia, mediation is a common method for resolving individual disputes between workers and employers, and is actively encouraged by the courts. In individual disputes, the parties can voluntarily enter into a mediation process at the start of the court procedure, and have a maximum of three months to reach an amicable solution before the judicial procedure continues.

Arbitration is less popular due to its expense, so it is mostly used in collective disputes and conflicts between employers and works councils. The procedure is regulated by ZKolT, with two possible types of disputes:

• an interest dispute, when a collective labour dispute arises from differing interests of the parties regarding the conclusion, supplementation or amendment of a collective agreement; or
• a rights dispute, when the parties disagree on the interpretation or implementation of the provisions of an existing collective agreement, or when one of the parties claims a violation of the agreement.

A list of conciliation experts for individual cases is established by the Minister for Labour, based on recommendations from unions and employer associations.

A special rule applies to legal costs in labour and social disputes. The courts usually require the employer to cover all costs associated with presenting evidence, even if the employee does not entirely prevail in the litigation and has not incurred any special costs as a result.

The court may also decide that each party bears its own representation costs if the employee participated in the proceedings without a legal representative or was represented by a trade union representative and did not (fully) win the case.

In disputes concerning the existence of an employment relationship or its termination, the employer is responsible for covering its own costs, regardless of the case's outcome, unless the employee has misused procedural rights by filing the action or through their conduct during the proceedings.