Definitons and regulation of illegal work and illegal employment in Slovakia
Illegal employment and attempts to circumvent the provisions on dependent work are among the most common offenses and subsequent sanctions in the field of employment in Slovakia. Labor inspectorates detect approximately 2,500 illegally employed natural persons each year.
In practice, these illegal activities are mostly carried out mainly in the field of construction, consulting services, cleaning services, retail and wholesale. Thus, an worker who works but does not have a contract or agreement, is not registered with insurance companies, does not receive a payslip, or is a foreigner without a permit to work, works illegally.
The benefit of ensuring the performance of work other than by employees or though business partners is primarily an increase in business profits at the expense of the safety and social conditions of employees. The advantages of illegal employment in relation to its participants have both the client (higher profit) and its contractor (without contribution obligations).
Illegal work is the performance of dependent work by a natural person for an employer, whereby illegal workers are considered workers:
- Who perform dependent work without a proper legal relationship concluded according to the Labor Code; or
- Who are Third-Country citizens (citizens of countries outside the EU, EEA or Switzerland) and who do not have the valid work permit and granted temporary residence for the purpose of work.
Illegal employment is considered:
- Employing a person who is Third-Country citizen (citizen of countries outside the EU, EEA or Switzerland) and who does not have the valid work permit and granted temporary residence for the purpose of work;
- Late employee registration and deregistration at Social Insurance Company; or
- Dependent work performed by employee without a proper legal relationship concluded according to the Labor Code.
Work is considered dependent work when the following conditions are satisfied:
- Work is carried out in a relationship, where the employer is superior and the employee is subordinate;
- The employee carries out the work personally for the employer;
- The employee carries out the work according to the employer´s instructions;
- The employee carries out the work in the employer´s name and during working time set by the employer; and
- The employee receives a wage or remuneration for his/her work.
It is not an illegal work nor employment when the work is carried out for a natural person who is an entrepreneur, or for a legal person which is a limited liability company and has at most one shareholder who is a natural person, by a relative in the direct line, sibling or spouse of this natural person or shareholder, if this relative in the direct line, sibling or spouse is a pensioner, recipient of a pension under special regulations or a pupil or student under 26 years.
On top of that, an Employer may be responsible and must not accept work or service which is supplied or provided by a service provider through an illegally employed worker also when it comes to the
- cross-border provision of the service for more than 30 days in a 12-month period from the first provision of the service, or
- a domestic supply (temporary assignment) or a cross-border supply.
The inspection of an illegal employment can be conducted by following authorities:
- Labor Inspectorate;
- Central Office of Labor, Social Affairs and Family; and
- Office of Labor, Social Affairs and Family.
During the execution of the inspection, the employer is obligated to provide the authority with all necessary documents. For example, with the copy of the temporary residence permit of Third-Country citizen.
Penalties that can be imposed on an employer who breaches the Act on illegal work and illegal employment:
- For the breach of ban of illegal employment of an individual it is possible to impose the penalty in the amount of minimum € 2.000 and maximum of € 200.000;
- For the breach of ban of illegal employment of two or more individuals it is possible to impose the penalty in the amount of minimum € 5.000 and maximum of € 200.000; and
- Repeated breach of the ban of illegal employment can be additionally considered as a reason for cancellation of trade license.
Except these penalties, there are also other sanctions that may impede the employer:
- entry in the central public list of natural persons and legal entities who have violated the prohibition of illegal employment in violation within previous five years, stating their business name, place of business of natural person and legal entity, identification number, dates of detection of violation of illegal employment,
- rejection to issue a certificate for the purpose of meeting the conditions under a special regulation which may be necessary for state aid and support, Eurofunds, public procurement, etc.
Penalties that can be imposed on a natural person (worker) for illegal work
- possibility to impose a fine for illegal work (up to the amount of € 331),
- exclusion from the register of job seekers on the day of detection (decided by the relevant labor office),
- administrative expulsion of a third-country national (optional and decided by the relevant police department).
In general, a third-country national may be employed in Slovakia if he/she:
- is an EU Blue card holder,
- was granted temporary residence for the purpose of employment on the basis of the confirmation on the possibility to fill in a vacancy – so-called single permit,
- was granted a work permit and temporary residence for the purpose of employment,
- was granted a work permit and temporary residence for the purpose of family reunion within the first 12 months from being granted the residence,
- was granted a work permit and temporary residence for the purpose of a third-country national with acknowledged long-term residence in another EU Member State within the first 12 months from being granted the residence, or
- meets the conditions under which he/she does not need the confirmation on the possibility to fill in a vacancy nor the work permit to become employed.
With regard to the current massive Ukrainian refugee situation, we find helpful to inform you that refugees who are granted Temporary protection (Temporary refuge) are allowed to work in Slovakia without needing further permits. However, they cannot run a business or be self-employed, this may be changed in the early future. Employers must inform the Office of Labor within seven working days from the commencement of the employment.
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