Amendments to the Employment Contracts Act as of 1.6.2026
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- Labour law
- Lay-off
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Changes will be made to the legislation on working life on 1.6.2026. The legislative amendments concern fixed-term employment contracts, the notice period for lay-offs and the employer’s obligation to take back employees.
It will be easier to enter into a fixed-term employment contract
Until now, an employer has been able to enter into a fixed-term employment contract only if there was a valid reason, such as a temporary replacement. An exception to this has been the hiring of long-term unemployed individuals, in which case a fixed-term contract could be entered into without a valid reason.
Going forward, a fixed-term employment contract may also be entered into without a valid reason when it is the first employment relationship between the employer and the employee, or when at least five years have passed since the parties’ previous employment relationship.
A fixed-term employment contract concluded without just cause may last for a maximum of one year. The contract also includes a termination option: once the employment relationship has lasted at least six months, the employer and employee may terminate the contract in the same manner as a permanent employment contract.
The employee also has the right to request, before the fixed-term employment relationship ends, a statement from the employer regarding whether it would be possible to continue the employment relationship either as a permanent contract or as a fixed-term contract for a justified reason. At the employee’s request, the statement must be provided in writing within one month.
If, upon the expiration of a fixed-term employment relationship, the employer is considering hiring new employees for the same or a similar position, the employer must first offer the position to the employee who was previously employed under a fixed-term contract. This obligation remains in effect for a period equal to one-third of the duration of the fixed-term employment relationship. If the employee does not respond to the job offer within two weeks, the employer may offer the position to another person.
The notice period for layoffs is being shortened
The notice period for layoffs is being shortened from 14 days to seven days. Going forward, employers must therefore notify employees of the start of a layoff no later than seven days before the layoff begins.
With this legislative change, the employer and the employee representative may also agree in writing on a seven-day layoff notice period, even if the applicable collective bargaining agreement stipulates a longer or otherwise different notice period.
The obligation to rehire will henceforth apply only to larger employers
Under the Employment Contracts Act, an employer is obligated to offer work to a former employee who has been laid off for operational or financial reasons. The obligation to rehire remains in effect for either four or six months, regardless of the duration of the employment relationship.
Going forward, the obligation to rehire will apply only to employers who regularly employ at least 50 employees. For employers with fewer than 50 employees, the obligation to rehire will be eliminated entirely.