Employment agencies in Serbia: How to set up and key legal differences

In recent years, Serbia has positioned itself as an increasingly attractive destination for both domestic and international businesses – thanks to a growing economy, competitive labor market, and strategic location in Southeast Europe. At the same time, employers are facing a growing demand for flexibility in workforce planning and staffing.

As a result, opening an employment agency in Serbia has become a timely and promising business opportunity. Whether you aim to connect job seekers with long-term employment or offer companies a flexible, short-term workforce, setting up an agency allows you to play a vital role in the dynamic Serbian labor market.

However, before entering this sector, it’s essential to understand the key legal distinctions between two closely related, yet fundamentally different, types of agencies:

• Employment Agencies, and
• Temporary Employment Agencies.

Each of these operates under specific legal rules and requires a separate licensing procedure. In this blog, we guide you through both the differences and the step-by-step process of establishing your agency in compliance with Serbian law.

What’s the difference?

Although the terms may appear similar at first glance, Employment Agencies and Temporary Employment Agencies operate under distinct legal regimes and serve different roles in the Serbian labor market. Understanding this difference is critical for choosing the right business model and complying with applicable legislation.

1. Employment Intermediation Agencies

An employment agency is a licensed company that acts as a professional intermediary between employers and job seekers. Its main goal is to facilitate employment—not by hiring candidates directly, but by helping match the right people to the right jobs.

Employment agencies in Serbia are legally permitted to offer a defined set of services, including:

• Informing individuals about job openings and working conditions;
• Arranging  employment both within Serbia and abroad;
• Providing career counseling and professional orientation;
• Collaborating with the National Employment Service to support government employment programs.

Why companies use this model?

This model is particularly attractive to:

• Employers looking to outsource recruitment and focus on their core business;
• Companies hiring for specialized, long-term roles;
• Job seekers in need of market guidance, such as career changers or those unfamiliar with the Serbian labor market.

For instance, a mid-sized IT company in Belgrade may need to hire several software developers. Instead of conducting a time-consuming recruitment campaign, the company can engage a licensed Employment Agency. The agency will promptly deliver a list of qualified candidates, organize assessments, and schedule interviews – all according to the client’s needs, allowing the employer to make informed decisions with minimal effort.

By bridging the gap between talent and opportunity, Employment Agencies contribute significantly to a dynamic and accessible labor market in Serbia, making them an essential part of the country’s employment infrastructure. As the shortage of qualified professionals in certain sectors becomes increasingly evident, the role and importance of employment agencies will continue to grow.

What are the technical requirements?

Before applying for a license, the agency must establish its physical presence at a designated business location. Serbian regulations require that the activity of employment intermediation or temporary employment is carried out in premises that meet certain technical and spatial standards.

These standards are intended to ensure that the agency operates in a professional, accessible, and functionally equipped environment, suitable for both clients and employees. The space must be clearly designated for business use and aligned with the type and scope of services the agency intends to offer.

Demonstrating compliance with these premises-related requirements is a necessary step in the licensing procedure and is subject to verification by the competent authority.

Who do you need on your team?

To successfully apply for a license, your agency must demonstrate that it has an adequate staffing structure in place. This includes employing individuals with relevant qualifications and professional backgrounds, in accordance with applicable regulations.

At a minimum, the agency must have at least one responsible person who meets the professional criteria for overseeing day-to-day operations and ensuring compliance with labor-related rules.

Other team members may also be required to meet specific professional standards, depending on the type of services the agency provides.

For agencies that plan to offer specialized services, such as career counseling, additional qualifications or licensed professionals may be needed to carry out those activities in a legally compliant manner.

Ensuring that your team structure aligns with regulatory expectations is a key element in the licensing process.

Licensing

Establishing a standard employment agency in Serbia involves fulfilling a set of legal and administrative requirements designed to ensure professionalism and compliance with labor regulations.

In addition to general prerequisites such as suitable office space and necessary equipment, the agency must:

• Submit internal documentation that clearly defines the scope and method of its operations;
• Employ qualified personnel;
• Ensure that staff members possess any required licenses, education, or relevant experience, in line with the scope of services the agency will provide.

Before a work license can be issued, the competent authority conducts a preliminary verification to determine whether all statutory conditions for operating an employment agency have been met.

This verification process is initiated by submitting a Request for Determining Fulfillment of Conditions for Employment Intermediation to the relevant ministry.

Anyone planning to establish an employment agency in Serbia should be prepared to operate in full compliance with regulatory standards from the outset, demonstrating transparency, clear internal structure, and accountability in all business processes.

2. Temporary Employment Agencies

Temporary Employment Agencies play a distinctive and increasingly relevant role in the modern labor market, especially in Serbia, where many companies are seeking more agile ways to adjust their workforce to shifting business demands. Unlike standard Employment Agencies, which act only as intermediaries, Temporary Employment Agencies assume full responsibility – as employers of engaged individuals.

In this model, the agency directly signs an employment contract with the individual. Then, based on a separate commercial contract, the agency assigns the worker to a third-party client commonly referred to as the User Employer.

Although the worker performs their duties at the User Employer’s location and under their direction, all legal responsibilities such as salary payments, social contributions, and labor law compliance remain with the agency.

Why companies use this model?

To better illustrate the model in action, imagine a retail company that sees a dramatic increase in demand during the holiday season. Instead of directly hiring and managing short-term workers, the company can simply engage a Temporary Employment Agency to supply the necessary staff for a fixed period, say, two months.

This allows the business to:

• Quickly scale up its workforce,
• Avoid the administrative and, most importantly, the legal burden of short-term contracts, arising from direct employment relationships with individuals,
• Remain focused on its core operations.

This model is ideal for companies that:

• Experience seasonal or project-based fluctuations in workload;
• Need to staff positions quickly, often on short notice;
• Want to minimize HR and legal complexity.

But flexibility comes with responsibility

While this model offers significant operational flexibility, the agency carries full legal responsibility as the formal employer.

This includes:

• Ensuring compliance with labor laws, including fair wages, working conditions, and health & safety. However, it’s important to note that Serbian law places the initial and immediate responsibility for reporting workplace injuries and occupational illnesses on the User Employer, and not the agency.
• Monitoring assignment durations and preventing misuse of temporary employment;
• Drafting clear and comprehensive contracts with both workers and User Employers.
• Recognizing that, under the Law on Agency Employment, the User Employer bears joint and several liability for the agency’s obligations related to salary payments, salary compensations, and reimbursement of statutory employee expenses.

One key legal safeguard: the same worker cannot be assigned to the same User Employer for more than 24 months continuously. This ensures that temporary employment is not used to bypass permanent hiring obligations.

What are the technical requirements?

To obtain a license, both Employment Agencies and Temporary Employment Agencies in Serbia must operate from business premises that meet prescribed spatial and technical standards.

These include having an appropriate office layout, essential office equipment, and basic infrastructure necessary for conducting professional employment-related services. The premises must be designated for business use and provide a functional and welcoming environment for clients and staff alike.

The same requirements apply uniformly to both types of agencies, ensuring a consistent standard of service and operational quality.

Who do you need on your team?

In order to obtain a license, a Temporary Employment Agency in Serbia must appoint at least one authorized representative responsible for signing employment contracts with workers and assignment agreements with user employers.

This individual must fulfill specific legal and professional criteria, which include a relevant level of education and professional qualification tailored to temporary employment services. Without such a person, the agency cannot legally conclude contracts or perform its core business activities.

Meeting this requirement is essential for demonstrating compliance with the legal framework governing temporary employment in Serbia.

Licensing

The process of obtaining a license for a Temporary Employment Agency in Serbia is more demanding than for traditional employment intermediation.

In addition to the standard requirements (like appropriate office space and equipment), the agency must:

• Provide extensive internal documentation outlining its operations;
• Employ qualified staff with appropriate licenses;
• Undergo an initial inspection by the Labour Inspectorate to verify full compliance.

Temporary Employment Agencies can be a powerful solution for companies seeking staffing flexibility without long-term commitment. But they are much more than intermediaries, they are legal employers with obligations to both workers and regulators.

Anyone considering opening such an agency must be ready to meet high compliance standards and operate with transparency, structure, and accountability from day one.

Step-by-step guide to establishing an employment agency in Serbia

Step 1: Choose the type of agency

Once you’ve determined that opening an employment agency is the right business move, it’s crucial to carefully follow the prescribed legal procedure to ensure full compliance with Serbian labor regulations. The process differs slightly depending on whether you’re registering a standard Employment Agency or a Temporary Employment Agency, so each step must be tailored accordingly.

The first and most important decision is choosing the legal model under which your agency will operate:

• Employment Agency: Acts as an intermediary between employers and job seekers, without employing candidates directly.
• Temporary Employment Agency: Directly employs workers and assigns them to third-party User Employers for temporary work engagements.

Each model follows a different regulatory path and has separate licensing requirements, especially in terms of inspections and internal documentation.

Step 2: Meet the technical requirements

Before submitting a licensing application, the agency must fulfill technical and spatial standards prescribed by the Ministry. These conditions ensure that the agency operates in a professional and legally compliant environment.

For Employment Agencies:

• There is no need to request a separate inspection.
• The inspection is conducted as part of the general licensing procedure by the Ministry, following the submission of the application.

For Temporary Employment Agencies:

• A separate request must be submitted to the Labour Inspectorate, requesting an on-site inspection to verify compliance.
• The Labour Inspectorate must carry out the inspection and issue a report within 15 working days from the date of a valid request.
• The licensing request can be submitted only after receiving a positive report confirming compliance.

Step 3: Prepare the necessary documentation

Depending on the type of agency, the applicant must collect and submit a set of documents that demonstrate compliance with the legal, organizational, and technical requirements. These typically include:

• Proof of compliance with spatial and technical requirements (inspection report or supporting documents);
• Certificate of qualified personnel:
• Company registration documents
• Additional documentation, as required by law or upon the Ministry’s request.

It is advisable to consult with a legal professional to ensure completeness and compliance of the documentation before submission.

Step 4: Submit the licensing application

Employment Agencies

• The application is submitted directly to the Ministry of Labour, Employment, Veteran and Social Affairs, without requiring a prior inspection.
• Once the application is submitted, the Ministry will conduct an on-site inspection as part of the licensing procedure.
• The Ministry is legally obligated to issue a decision within 60 days from the date of submission, taking into account the inspection findings conducted during the process.

Temporary Employment Agencies

• Before applying, the agency must first request and undergo an on-site inspection by the Labour Inspectorate.
• The application is submitted to the Ministry only after receiving a positive inspection report.
• The licensing decision is then based solely on the submitted documentation and the inspection findings.
• The Ministry must issue a decision within 30 days from the date of a complete application.

These timeframes are based on the Law on General Administrative Procedure, but in practice, the deadlines may vary depending on the Ministry’s workload or if clarifications are requested.

Delays can often be avoided by ensuring the application is complete, accurate, and includes all necessary attachments. It is also recommended to maintain open communication with the Ministry or consult with a legal advisor throughout the process.

To help you decide which type of agency best fits your business model, below is a side-by-side comparison of Employment Agencies and Temporary Employment Agencies based on the most relevant legal, operational, and administrative criteria: