Preparation of Legal Procedures Related to Employment Relationships

Under the Labor Code of the Republic of Albania, the legal employment relationship is a formal relationship and must be accompanied by a contract between the parties. We provide consultancy services for drafting employment contracts, procedures for granting annual leave, disciplinary measures, termination procedures, and more.

When is an employment relationship finalized (secured, contracted, and formalized)?

Every employer is legally obligated to officially declare to the tax authority any employee starting work for the first time in their enterprise or newly hired at least one calendar day before the start of employment.

The employment contract is the sole agreement between the employer and the employee. Based on the principle of contractual freedom, its terms are defined in accordance with the Labor Code of the Republic of Albania, other legal and sublegal acts of labor legislation, and the expressed will of the parties

The employment contract must be concluded in written form. The employee begins work after signing the employment contract document. Exceptionally, formalization may occur within 7 days for justified and special cases.

The employment contract must be concluded in written form. The employer is obligated to formalize it within 7 days from the date of employment. It is drafted for the performance of work for a fixed or indefinite period, solely in exchange for remuneration

The types of individual employment contracts are as follows:

• Full-time individual employment contract.
• Part-time individual employment contract.
• Individual apprenticeship contract.

The employment contract must necessarily contain the elements:

• Identity of the parties.
• Place and description of work.
• Start date of employment.
• Duration (fixed-term / indefinite-term).
• Normal daily and weekly working hours.
• The normal daily working hours are 8 hours per day and 40 hours per week. Any hour worked beyond normal working hours is considered overtime.
• When referring to working duration, it means the time during which the employee is at the employer's disposal, including the time spent on professional training or retraining, as approved by the employer.
• Break periods, during which the employee is not at the employer’s disposal, are excluded from working time.
• Salary components and payment date.
• In this context, wage refers to the basic salary and any permanent allowances. Currently, as per a VKM, the minimum wage is set at 24,000 (twenty-four thousand) Albanian Lekë. Wages are exclusively paid through the banking system. For each payment, the employer provides the employee with a calculation statement. This statement includes the wage amount, the bases for calculation (if variable), and all deductions from it. This must be provided on the date specified in the contract between the parties.

Wage supplements for work performed on:

Shift work:

• Second Shift (from 19:00 – 22:00, supplement no less than 20%)
• Third Shift (from 22:00 – 06:00, supplement no less than 50%)

Weekly rest includes Sunday. Work performed on weekly rest days is compensated at no less than 25% extra pay or with time off equivalent to the duration of the work performed plus an additional rest period of no less than 25% of that work's duration.

Work performed on official public holidays is compensated at no less than 25% extra pay and with a paid rest period equal to the duration of the work performed on those official public holidays.
Work performed as overtime is paid at no less than 25% extra, unless otherwise stipulated in the collective agreement. Overtime hours worked during weekly rest days or on official public holidays are compensated with time off or pay at least 50% higher than normal wages, unless otherwise stipulated in the collective agreement. This compensation includes the compensations mentioned in the preceding paragraphs.

• Duration of annual leave.
  ANNUAL LEAVE is no less than 4 calendar weeks during the ongoing work year.
  Annual leave does not include official public holidays. If an official public holiday falls on a paid annual leave day, the annual leave is extended.
  For employees who haven't completed a full year of work, the duration of annual leave is calculated proportionally to the length of time worked.
• Termination of employment and notice during the probation period.
  During the probationary period, either party may terminate the contract by giving at least 5 days' notice.

An indefinite-term contract concludes when it's terminated by one party and the notice period has expired. The parties must respect a notice period:

• of two weeks, when the employment relationship has lasted up to six months,
• of one month, for a duration of over six months up to two years,
• of two months, for a duration of over two years up to five years,
• of three months, for a duration of more than five years.

A fixed-term employment contract ends at the conclusion of the foreseen period, without prior termination.

The employer must notify the employee in writing at least 72 hours before the meeting and discuss with them, presenting the reasons for the decision. The termination is announced in writing, with the reasons for termination, within a period of 48 hours to one week after the meeting.

• Types and procedures of disciplinary measures.
  Caution! The imposition of fines by the employer is prohibited, with the exception of fines specified in the Collective Agreement.
• References to the collective agreement (if a trade union organization operates and a collective agreement exists).