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Laws which need further revision

The law on collective bargaining, the Code of Civil Procedure, the Labour Code, the Commercial Code 

(Source: TASR)

The Slovak Spectator spoke about these changes with Daniel Futej, partner at Futej & Partners, Allen & Overy Bratislava law firm, Tomáš Urban, attorney at Čechová & Partners, Ľubomír Leško, attorney at Peterka & Partners, and Havel, Holásek & Partners law firm.

Read also: Read also:The most important legislative changes

TSS: Which legislative areas or laws do you think need further revision and why?

Daniel Futej : The new law on collective bargaining reinforces authority of trade unions and representatives of employees to pay hikes, even against the will of the firm. The higher collective agreements are automatically valid and enforceable even to the other firm employing more than 20 employees and such automatic enforcement is valid even against the will of that other firm. Such a law may unfavourably increase the cost related to employment since even if a specific business entity is not a party of the bargaining agreement between two specific parties still the result of such bargaining may impact its business.

Allen & Overy Bratislava: Court proceedings in civil and commercial matters are certainly a point of concern for many businesses and potential foreign investors. The current Code of Civil Procedure dates back to 1963 and it is not in good shape, mainly due to a multitude of often inconsistent amendments and patches. Therefore, we appreciate that the Ministry of Justice has prepared three brand-new Codes governing, respectively, civil litigation, judicial review of administrative actions and non-contentious proceedings. The adoption of these Codes, which is scheduled for 2015, will be a major reform, although its practical implications remain to be seen.

Secondly, we often see problems in bankruptcy and restructuring proceedings. In the wake of several major restructurings in 2014, this also seems to have become a political issue. Whether a legislative amendment can improve the current regime will require further analysis.

Read also: Read also:Controversial legislation adopted in 2014

Tomáš Urban : We believe that from a long-term perspective, labour law would deserve a substantial revision in order to make it more liberal and flexible. Especially, it seems that a differentiation of various categories of employees in the Labour Code may be beneficial both to employees as well as to employers. Currently the Labour Code provides the same level of protection to top-management officers of banks as to manual workers at a production plant. However, it may be advisable to reflect different needs, positions and negotiating and decision powers of white collar employees and blue collar employees. We can see within the EU a trend to adapt labour law to a post-crisis situation and to flexibly react to the current situation in order to encourage and attract new business. However, the Slovak labour law tends to be more conservative and rigid facing a risk that it would not keep up in the present competitive environment.

Ľubomír Leško : The persisting problem is non-effective operation of courts and low law enforcement. The slow speed of court proceedings and disputability of many court decisions decrease the trust in the judicial system and negatively impact the business environment. Therefore we consider the reform of the Code of Civil Procedure necessary.

Regarding the labour law, the duties of employers are spread among an extensive number of laws, while, for example, new or foreign entrepreneurs can have a problem securing harmony with all administrative rules. For this reason these employers are often punished with high fines regarding their failure to observe the duties in the respective laws. We thus consider it necessary to improve the clarity of laws in employment relations, reduce the red tape and also improve the communication between respective public administration bodies when directing the entrepreneurs about fulfilling particular duties.

Havel, Holásek & Partners: Since the European Parliament and the European Council adopted three new directives applying on public procurement, it will be necessary to adopt the new law on public procurement whose preparation has already started.

Moreover, it is also necessary to adopt the amendment to the Commercial Code which would unite the provisions for transformations of companies (merging and splitting); introduce separate rules for partnerships as well as separate rules for limited liability companies; remove the current conflict provisions and introduce the institute of separation which is common in other European jurisdictions. It is also necessary to amend cross-border mergers (and especially cross-border mergers with a successor in Slovakia) instead of currently used application of the provisions on mergers of joint-stock companies since the current rules are full of questions.

Regarding taxes it would be necessary, in order to stimulate economic growth and employment, to make further changes with the aim to improve the business environment. This concerns especially the simplification of the whole agenda in the field of customs and payroll taxes, and of course reduction of administrative burden, which compared to other priorities, still seems to be in the background.

Topic: Finances and Advisory


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