An employer signs an employment contract with a qualified electronic signature. The employee signs. The employment relationship begins. Everything looks in order. Then the labour inspector arrives and records that the contract was not signed in accordance with the Labour Law because it was not in printed form. That scenario is not theoretical. It happens.
The problem is not employers' desire to modernise their operations, nor the capabilities offered by the Law on Electronic Document. The problem is that the Labour Law and the Law on Electronic Document are misaligned, and the Ministry of Labour has for years been issuing opinions that de facto deny the purpose of the electronic document. This article traces that misalignment point by point and provides a risk assessment for employers. For a general introduction to the types of electronic signatures and their legal standing, see our guide to electronic signatures in Serbia.
Contents
- Regulatory Misalignment: What Is the Problem?
- The Labour Law: What Does It Say About Written Form?
- Ministry of Labour Opinions: What They Said and Why It Matters
- What Are the Specific Risks for Employers?
- Keeping Contracts in Electronic Form: What Does the Law Require?
- Risk Assessment and Recommended Approach
- Frequently Asked Questions
Regulatory Misalignment: What Is the Problem?
The Law on Electronic Document provides that an electronic document is created using available information and communications technologies, and that its validity, evidentiary value, and written form cannot be challenged solely on the grounds that it is in electronic form. This law is available on Paragraf.rs. This rule applies exclusively to a document signed with a qualified electronic signature, not just any electronic signature.
The Law on Contracts and Torts establishes as a general rule that the conclusion of a contract is not subject to any particular form, unless otherwise prescribed by law. For the majority of commercial contracts, this means freedom of form.
Employment law is different. The Labour Law contains no provisions specifically regulating electronic signing of employment law documents, and where it requires written form, this is interpreted in practice as meaning printed form.
An analogy that illustrates the problem: imagine that a Construction Law requires a project to be submitted in "written form", and the competent authority insists that "written form" means exclusively on paper, even though another law explicitly equates paper and electronic form. In employment law, that situation is real.
Documents that are explicitly or practically excluded from electronic form include the employment contract, contracts that do not establish an employment relationship (temporary and occasional work contracts, service contracts), all decisions delivered during the employment relationship (leave, salary reduction, termination), and termination documentation.
The Labour Law: What Does It Say About Written Form?
The provisions of the Labour Law establish that the paper, printed form has absolute primacy.
The employment contract is concluded before the employee commences work, in written form, in three copies. The employer delivers decisions on the exercise of rights, obligations, and responsibilities to the employee in written form, with a statement of reasons and instructions on legal remedies. This covers annexes to the employment contract, decisions on salary reduction, decisions on termination, and all other decisions determining employees' rights, obligations, and responsibilities. Employment may be terminated on the basis of a written agreement. An employee delivers notice of resignation to the employer in written form, at least 15 days in advance.
The provisions on delivery proceed on the assumption that these documents are delivered in printed form. The termination decision must be delivered to the employee in person on the employer's premises; if that is not possible, by post with return receipt. If delivery still cannot be achieved, the decision is posted on the employer's notice board. Electronic delivery is not provided for in this procedure.
Two Exceptions
The Labour Law provides for only two documents that can unambiguously be in electronic form: the decision on the use of annual leave and the salary statement.
However, on the employee's request the employer is obliged to deliver the decision on the use of annual leave in printed form as well. This benefit is therefore placed at the employee's discretion, which effectively negates it in practice.
Why Is This Rule Problematic?
The Labour Law distinguishes between written and electronic form, while simultaneously treating "written form" as meaning "printed form". If the Law on Electronic Document equates written and electronic documents in terms of validity, how can the Labour Law dispute that equivalence?
Our position is that if printed form is required for a document to be valid, a document signed with a qualified electronic signature must also be accepted. However, given the statutory provisions and the positions of the competent authorities, this remains disputed for the time being.
Ministry of Labour Opinions: What They Said and Why It Matters
The positions of the competent authorities have not changed in years and lean towards the obligatory conclusion of employment contracts and other employment law documentation in printed form.
The Ministry of Labour, Employment, Veterans and Social Affairs, Labour Sector, issued Opinion No. 011-00-606/2015-02 dated 18 June 2015:
"When the decision on the use of annual leave is delivered to the employee in electronic form, we are of the opinion that it should be delivered scanned in electronic form, and not sent to the employee in electronic form without a signature and stamp. Also, the employer must provide proof that they delivered the decision to the employee electronically, i.e., that the employee received and read the email."
The Ministry confirmed this position in Opinion No. 011-00-468/2020-02 dated 25 January 2021, adding that a document is considered delivered once the employee confirms receipt of the email.
The problem is clear. The Ministry treats "electronic document" as meaning a scanned paper document with a stamp and signature, not an electronic document signed with a qualified electronic signature. This entirely defeats the rules laid down by the Law on Electronic Document.
An additional burden: the employer must prove that the employee actually received and read the email. This means obtaining confirmation of receipt every time. Where that confirmation is absent, it remains unclear whether delivery was effected at all.
What Are the Specific Risks for Employers?
If you were to sign an employment contract with an employee using a qualified electronic signature today, our view is that it would be invalid. That would not, however, mean that the employment relationship had not been established.
There is a legal fiction that an employment relationship is established on the day the employee commences work, regardless of whether the contract has been signed. Such an employment relationship would be treated as one of indefinite duration, governed exclusively by the provisions of the Labour Law and not by the provisions of the invalid contract.
The practical consequences are serious:
- If the contract provided for a probationary period, it would not apply.
- If the contract imposed specific obligations on the employee that the Labour Law does not explicitly regulate, those provisions would not apply.
- If the contract limited the employee's right to a salary above the statutory minimum, that limitation would not apply.
The same situation and the same level of risk apply to contracts that do not establish an employment relationship: temporary and occasional work contracts and service contracts.
Particularly high risk exists in relation to delivering termination documentation. A court may take the position that the formal procedure prescribed by the Labour Law for proper delivery was not followed, on which basis the lawfulness of the termination may be called into question. Where there are solely formal deficiencies in the termination procedure, the employer may be ordered to pay the employee compensation amounting to up to 6 months' salary.
Keeping Contracts in Electronic Form: What Does the Law Require?
Under the Labour Law, the employer is obliged to keep the employment contract, or other type of contract concluded in accordance with the law, at its registered office or other business premises, depending on the employee's place of work.
If a document were in electronic form, the employer would be obliged to keep copies of the electronic documents. Any printing of an electronic document is treated as a copy. For that copy to be valid, it must be printed under the supervision of an authorised person, with a notation and confirmation that the electronic and printed forms are identical, and bearing the stamp and signature of the authorised person.
If the employer fails to comply with this obligation, misdemeanour liability may follow. The fine for this misdemeanour is prescribed in the range of RSD 400,000 to 1,000,000.
In short: moving to electronic form does not eliminate the obligation to keep records. It only makes it more burdensome, because a paper copy of an electronic document requires a special certification procedure.
Risk Assessment and Recommended Approach
There are significant differences in the legal position depending on the document in question. For salary increases or ordinary internal acts without a specifically prescribed form, the risk is considerably lower. For employment contracts, annexes, and termination documentation, the risk is high.
Our assessment is that, within the current legislative framework, signing employment contracts and employment law documentation with an electronic signature in cases where this is not explicitly permitted by the Labour Law would represent taking on unnecessary risk. We consider that amendments to the Labour Law would need to include a provision explicitly permitting electronic form for all documents that may be concluded in printed form. That would bring the two laws into alignment and provide legal certainty. For the time being, no such amendments have been enacted.
A note for employers establishing a company: alongside employment law documentation, a qualified electronic signature of the director is also required for company registration with the SBRA. This is an obligation, not an option. For more on this, see our guide to company formation in Serbia.
Conclusion
Electronic signing of employment law documents is technically possible. Legally, for most key employment law documents, it is not advisable at this time.
The misalignment between the Labour Law and the Law on Electronic Document, combined with Ministry opinions that do not reflect a modern understanding of electronic documents, creates legal uncertainty that employers bear at their own cost.
For all questions relating to employment law and the electronic form of documents, the employment law practice at Zunic Law is available to assist.
Frequently Asked Questions
Can an employment contract be signed electronically?
Not without risk. The Labour Law requires written form, which is interpreted in practice as printed form. An employment contract signed exclusively with a qualified electronic signature may be deemed invalid by the labour inspectorate or a court. The employment relationship would nonetheless be established (legal fiction), but without the provisions of the contract.
Which employment law documents are safe for electronic form?
The Labour Law explicitly permits electronic form for only two types of documents: the decision on the use of annual leave and the salary statement. However, the employee has the right to request a paper copy of the annual leave decision as well, which in practice limits the practical value of this exception.
What has the Ministry said about electronic documents in employment law?
The Ministry of Labour has taken the position that an electronic document is valid if it is a scanned paper document with a stamp and signature, delivered by email, with confirmation that the employee received and read it. This is an incorrect interpretation: an electronic document is one signed with a qualified electronic signature, not a scanned PDF. These opinions are not binding, but inspectors as a rule follow such positions.
What are the penalties for improper keeping of employment law documents?
The fine for failure to fulfil the obligation to keep employment contracts and related documentation ranges from RSD 400,000 to RSD 1,000,000. This obligation applies even where documents are in electronic form: copies must be available at the place of work, and paper copies of electronic documents must be certified by an authorised person.
When could the situation change?
An amendment to the Labour Law explicitly permitting electronic form for all employment law documents would resolve this problem. Such amendments are expected in the context of digitalisation, but have not yet been enacted. Until then, it is advisable to monitor the positions of the competent authorities and use electronic form only for documents where it is unambiguously permitted. For current guidance on employment law in Serbia, see our employment law practice page.
About the author
Reviewed by
