Clarifications from the Ministry of Labor on Fixed-term Contracts

The Ministry of Labor and Social Policies has issued circular no. 9/2023 to provide clarifications on the new provisions introduced by Decree-Law no. 48/2023 (so-called “Labor Decree”).

In this regard, the circular clarified that the maximum duration limit for fixed-term employment remains unchanged, i.e., twenty-four months.

The Ministry also reiterated the possibility of freely extending the contract in the first 12 months and subsequently only in the presence of the so-called “causal” reasons, as provided for in collective agreements, and, until April 30, 2024, for technical, organizational, or production-related needs identified by the parties.

The same circular clarified that, for the purpose of reaching the maximum limit of twelve “non-causal” months, only employment contracts entered into from the 5^th of May, 2023, the effective date of the Labor Decree, should be taken into account.

Fixed-term contracts that may have occurred between the same parties and entered into before this date, therefore, should not be counted towards the calculation of the 12 “non-causal” months; therefore, employers may freely resort to fixed-term employment contracts for an additional period of up to twelve months without the need to specify a reason.

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