- Overview: Bosnia and Herzegovina
- Global HR Compliance
- Global PEO and payroll
- Work permit for hiring expats via PEO
- Contractor vs. employee: which is better?
Global HR Compliance in Bosnia and Herzegovina
If you hire international workforce, or plan to hire, then Hiring and Firing Workforce in Bosnia and Herzegovina Guide below will help you understand the nuances of labor legislation in the country.
Companies hire international workforce for various reasons but in most cases they are:
- entering the foreign markets to sell company products. To do so, the company hires sales representatives who would represent their product and sell it to their local client base.
- hiring a global talent with unique skills that is unavailable in the local market or costs the company less than the talent with similar skills hired in the home country.
Before entering a certain foreign market or engaging a global talent, it is crucial for the company to understand how it can make local hires and reward its workers on a monthly basis. Growing companies often face a challenge of paying benefits and bonuses to the commission-based independent sales representatives they are working with.
If you intend to hire and pay your foreign workforce in full compliance with labor laws and regulations of Bosnia and Herzegovina, then the Global Employer of Record service from Acumen International may be the best way for you to go. We are an International PEO company and we specialize in global employment, meaning we can employ your employees in Bosnia and Herzegovina and act as their legal employer on your behalf. We will payroll your foreign workforce monthly and provide benefits to them through our global network so you don’t have to set up your own legal entities there.
We are experts in global workforce employment in , and our goal is to become your single provider. Instead of working with numerous local staffing agencies and legal advisors, Acumen International can solve your global business challenges and save you time, costs, and resources.
Our team of English-speaking professionals frees you from working through language nuances. Acumen International works 24/7 and can assist you whenever you need, regardless of time zones. Our goal is to create tailored labor solutions for you that are managed legally and in full compliance with the local employment laws.
With our knowledge and deep understanding of local nuances, you easily satisfy your need for skilled professionals in your global industry. With our qualified local partners, you can trust that your global workforce satisfies all local tax, social security, and immigration requirements in Bosnia and Herzegovina.
Hiring and Firing Workforce in Bosnia and Herzegovina Guide
# Employment contracts
In general according to the Labour Law of Bosnia the labor contract could be concluded for:
- unlimited period (labor contract which doesn`t contain data on duration should be considered as the labor contract for unlimited duration);
- fixed period (fixed term labor contract couldn`t be concluded for period longer than three years).
It`s important to note that in case the employee has renewed a fixed term labor contract with the same employer, or concluded successive fixed term labor contracts with the same employer for a period longer than three years, without any interruption between them, such a contracts should be considered as an unlimited duration labor contract.
Besides, the Labour Law stipulates that a contract shouldn’t be deemed as terminated if there is a 60-day gap between two fixed-term contracts with the same employer. The Law also requires contracts to be concluded in written form and contain all the compulsory elements stipulated by the law.
According to the legislation, the employer is required to provide the employee with written evidence and copies of the mandatory insurance registration from the date when the contract was concluded, i.e. since the start of the employment relationship, as well as all insurance changes that affect the employee.
The Law prescribes possibility to sign the labour contract for work activities that the employee performs from his/her home or in another location provided by the employee.
# Minimum (Statutory) Employment Rules and Regulations in Bosnia and Herzegovina
# Hours of work:
As stated in the Labor Code of Bosnia the full-time work should be 40 hours per week, unless otherwise defined to be shorter in accordance with the law, collective agreement, or labor contract.
So the employment agreement may be conclude for full-time or part-time basis.
The usual working schedule for employees is following: 5-day work week and an 8-hour workday, which should be announced in the most convenient way possible and to keep daily records of when employees start and finish their workday, which will be of great use to the employees in filing legal claims against their employers in order to protect their rights and the rights to pay and benefits.
There are following main requirements for the working time of the employee:
- limit to weekly working hours, which must not exceed 48 hours on average, including any overtime;
- minimum daily rest period of 11 consecutive hours in every 24;
- rest break during working hours if the worker is on duty for longer than 6 hours;
- minimum weekly rest period of 24 uninterrupted hours for each 7-day period, in addition to the 11 hours’ daily rest.
The night work is working hours in the period between 22 hours in the evening and 6 hours in the morning of the following day. By the consent of the employee and based on the employer`s request the employee can perform continuous night work for longer than one working week with shift work also bringing higher pay, although the amount is not specified.
# Probation period:
The probation period of the employee may be agreed and indicated in the employment agreement and couldn`t exceed 3 months. In case of dismissal during the probation period the notice should be provided by the employer at least seven days before.
# Annual leave:
The employee should be entitled the annual leave with duration of 20 working days, but no longer than 30 working days per each calendar year. In the case of the first employment or break in more than 15 days between the last and current employment the employee may use the annual leave after six months of continuous work or by the request of employee for using the annual leave before completing the six months continuous work employment the employee could be entitled at least one day of annual leave for each completed month of work. In case the employee is entitled to use one day of annual leave by his/her request has the obligation to inform the employer to this effect at least three days before its use.
The annual leave could be divided in two parts, but there exists the rule that prescribes that the first part should be used without interruption in the duration of at least 12 working days in the course of a calendar year, and the second part should be used no later than June 30th of the next year.
# Parental leave:
In Bosnia the duration of the maternity leave for woman due to the pregnancy, delivery, and care for the baby is 1 year without interruption. The start date of maternity leave may be 28 days prior to the anticipated date of delivery. Exceptionally, a woman may use shorter maternity leave, but not shorter than 42 days after delivery. Besides, the father of a child may also exercise the right to paternity leave, if the parents so agree or in case of the mother’s death, if the mother has abandoned the baby, or if she is prevented from using maternity leave for other justified reasons.
# Sick leave:
The employment contract of an employee who is temporarily incapacitated due to an injury at work or an occupational disease cannot be terminated. Also the period of temporary inability to perform work shall not be included in the contract duration, which is particularly important for employees on fixed-term contracts. After recuperating, the employee is entitled to return the work if an authorised doctor of medicine has established that s/he is fit to go back to work. If there is no longer any need for the work performed by the employee prior to becoming temporarily incapacitated, the employer is obligated to offer an employment contract for other, appropriate jobs. If the employee refuses the offer, the employer is entitled to terminate the contract in accordance with legal regulations, except in cases when an employee is suffering from a work-related injury or occupational disease. The Labour Law stipulate that an employee shall notify the employer of temporary incapacity, to work within three days from the day of becoming incapacitated, and provide confirmation from the competent doctor of medicine. In case of illness, the confirmation shall be delivered by his/her family members, and if the employee lives alone, within three days after the illness is over. If in doubt, the employer is entitled to initiate proceedings to ascertain the medical fitness of the employee and contest the validity of the certificate issued by the doctor of medicine. The certificates issued by doctors of medicine are uniform, their issuance and content is prescribed by the competent ministry of health and social protection and they can be used as evidence in civil procedure.
In case of force majeure (fire, earthquake, flood) or a sudden workload increase, as well as in other similar cases of emergency, at the request of employer an employee shall be obliged to work longer hours than his full-time hours (overtime work), however up to 10 hours a week. If the overtime takes longer than three consecutive weeks or more than 10 weeks in a year, the employer shall inform the competent labor inspectorate about it. The Law stipulates that the employee has the right to an increase in salary for overtime work but does not specify in what amount. Employee may voluntarily, at the request of employer, work overtime, however no longer than hours a week.
# State minimum salary:
The state minimum salary for Bosnia has been changed in January 01, 2015 and established in the equivalent of 406 convertible mark per month.
# Employee dismissal:
According to the Labour Law of Bosnia there are the following reasons for termination of the labour contract:
- due to the death of an employee;
- by an agreement between the employer and employee;
- when the employee reached 65 years of age and 20 years of pension insurance coverage, unless otherwise agreed upon between the employer and employee;
- when it is determined based on records that the employee worked for 40 years, unless otherwise agreed upon between the employer and employee;
- on the day of delivering the decision acknowledging rights to disability pension due to loss of working abilities;
- by lapse of time to which the fixed-term contract was concluded;
- if an employee is sentenced to a prison term longer than three months – on the day of commencement of prison term;
- if a security, correctional or protective measure has been imposed on an employee, lasting for more than three months – on the day of commencement of measure enforcement;
- by a final decision of a competent court resulting in termination of labor relations.
An employer may terminate the labor contract of an employee with the prescribed notice period in the defined cases:
- the termination is justified for economic, technical or organizational reasons, or
- an employee is not able to perform his duties arising from labor relations.
The notice period may not be shorter than seven days when an employee is terminating a labor contract, or shorter than 14 days when an employer is terminating a labor contract. The notice period shall start to run from the day of delivery of the notice to an employee or an employer. The collective agreement, Rulebook on labor, and a labor contract may define a longer notice period, but not more than a month when an employee is giving a notice to an employer, i.e., three months when an employer is giving a notice.