Employment protection legislation in Croatia

Abstract

According to business climate and competitiveness indicators published by international organisations, Croatia is a country with a rigid labour market and a high level of the legal protection of employees. Given that an Act on Amendments to the Labour Act (OG 73/13) entered into force in Croatia in June 2013, this paper examines changes in employment protection legislation in Croatia and Central and Eastern European (CEE) countries, as well as in Croatia's main trading partners during the period between 2008 and 2013. A cross-country comparison shows a strong downward trend in legal employment protection in most CEE countries during the observed period, primarily as concerns individual dismissal in the cases of regular employment contracts, while in the case of temporary employment the protection strengthened slightly. On the other hand, despite the adoption of amendments to the Labour Act (LA), Croatian labour legislation governing employment protection for regular employment contracts remains relatively inflexible compared to that in other countries.