Hamburger
  • Legal system, currency, language

    Constitutional. The official currency is the Kwanza (AOA). The official language is Portuguese.

  • Corporate presence requirements & payroll set-up

    A foreign entity may engage employees in Angola with proper payroll registrations, subject to business, corporate and tax considerations. The employer is responsible for withholding from an employee's pay, and delivering to the tax authority, income tax and contributions to Angolan social security. The level of income tax is defined by the government and varies in line with the employee's salary.

  • Pre-hire checks

    Required

    Immigration compliance and pre-hire medical examinations.

    Permissible

    Reference and education checks are permissible.

  • Immigration

    Criminal and medical checks must be issued by competent authorities, a criminal record must be issued by the home country and a medical certificate must be issued by a doctor in the employee’s home country.

    The visa/work permit requirements for overseas nationals to work in Angola are having a recognized travel document valid for the Angolan territory for at least 6 months, being of legal age, not being included in the national list of undesirable persons prohibited from entering into the national territory, not constituting a danger to public order or to social security interests, complying with all health regulations established by the Ministry of Health for entry into the national territory, having an employment contract or promissory employment contract, having a certificate of professional and educational qualifications and curriculum vitae, and obtaining a positive opinion of the competent Ministry.

  • Hiring options

    Employee

    Indefinite-term contract (which is the rule), fixed-term or open-term (ie, a term contract whose termination date has not yet been defined, but that will be terminated as soon as the underlying need for contracting is no longer verified – for example, as a contract to cover absence), part-time contract, telework contract and contract under service commission regime – a particular type of contract for high-level employees which provides flexibility for termination and is not common. The parties may execute an employment contract for a fixed term or open term, which must be done in writing.  Part-time, fixed-term and open-term employees may not be discriminated against due to their status.

    Independent contractor

    Independent contractors may be engaged directly by the company or via a personal services company. Engagement may be subject to misclassification exposure. The factors that tend to indicate an individual is an employee (rather than, for example, a self-employed independent contractor) are the existence of a work schedule, the scheduling of vacation, the worker’s legal subordination to the company, the company’s authority, direction and disciplinary powers, control of punctuality and attendance over the individual, integration into the structure of the company and use of work tools belonging to the company, among others.

    In the event of misclassification, the relationship may be converted into an employment relationship on a permanent basis, and the employer may be liable to pay a fine for non-compliance.

    Agency worker

    Agency workers may only be engaged to fulfill a temporary need for work. The agency work contract duration depends on the underlying reason for hiring and does not typically exceed 12 months. Agency workers have the right to equal treatment to employees in relation to pay and other regular benefits.

  • Employment contracts & policies

    Employment contracts

    Written employment contracts are common but not mandatory, except for fixed-term, part-time, telework and service commission regime contracts as well as contracts with foreign employees and underage employees. Employment contracts cannot contain conditions that are less favorable to employees than mandatory employment legislation.

    Probationary periods

    Permissible.

    Employment contracts for an unlimited period of time may be subject to a probation period corresponding to the first 60 days of performance of work; the parties may, by written agreement, reduce or waive this period.

    The parties may extend the probation period, in writing, to up to 4 months in case of employees who perform highly technical, complex work that is difficult to evaluate, and to up to 6 months in case of employees who perform management duties.

    In an employment contract for a limited period of time, the parties may set forth a probation period in writing, and its duration cannot exceed 15 days in case of non-qualified employees, or 30 days in case of qualified employees. Angolan law does not define qualified and non-qualified, but the common practice is that qualified employees correspond to positions that involve technical complexity, a high degree of responsibility or special qualifications as well as those carrying out functions of trust.

    Policies

    Employers with more than 50 employees must, in order to organize the work and labor discipline, draft and approve employee handbooks, guidelines, instructions, service orders and work rules defining rules for the technical organization of work, performance of work and work discipline, delegation of powers, employee job descriptions, safety, hygiene and health protection of work, performance indicators, a remuneration system, working hours for the several sections of the company or work center, control of entrances and exits and circulation within the premises of the company, and surveillance and control of production.

    Employers with 50 or fewer employees may, but are not required to, implement employee handbooks on the matters described above.

    Third-party approval

    Whenever the employee’s handbook or any other rules and regulations establish rules on performance and discipline, remuneration systems, work performance or safety, hygiene and health protection at work, the employer must forward such regulations for information and registration purposes to the General Labor Inspectorate.

  • Language requirements

    Portuguese. Nevertheless, employment contracts and other documents may be drafted in a bilingual template.

  • Minimum employment rights

    Employees entitled to minimum employment rights

    All employees are entitled to minimum employment rights.

    Working hours

    Maximum daily and weekly working hours are 8 hours per day and 44 hours per week. Overtime pay is required for hours worked in excess of these limits. These limits are inapplicable to employees who perform direction and leadership duties, duties of inspection, or provide direct support to the employer. In case the employee usually performs their work outside the company's premises, an exemption regime may also be agreed upon by the parties, in which case those limits shall not apply. Typically, employees under the exemption regime are entitled to an exemption bonus.

    Overtime

    Overtime may occur with an extraordinary increase in workload, to prevent serious damage or if due to majeure force. It is subject to the following maximum limits: (a) 2 hours per day, (b) 40 hours per month and (c) 200 hours per year.

    Overtime must be compensated with additional payment (ie, an increase of hourly rates) up to 30 hours per month: 50 percent. 30 percent, 20 percent and 10 percent depending on whether it is a large, medium, small or micro company dependent on number of employees and turnover. A company which is a subsidiary or branch of a company with headquarters abroad always qualifies as a large company. Overtime that exceeds that limit is paid for each hour at an additional 75 percent, 45 percent, 20 percent and 10 percent depending on whether it is a large, medium, small or micro company.

    Wages

    The minimum wage is established by Presidential Decree. It is set out as a general minimum wage, but there is also a minimum wage for trade and extractive industry groups, transport services and manufacturing groups and agriculture groups. Under the Decree currently in force, the general minimum wage is AOA21,454.10. The following sector-specific minimum wages also apply:

    • Trade and extractive industry groups: AOA32,181.15
    • Transport services and manufacturing groups: AOA26,817.63 and
    • Agriculture groups: AOA21,454.10.

    Vacation

    Minimum 22 working days per year, plus 12 public national holidays.

    Sick leave & pay

    Employees are entitled to take off as much time as they need for sick leave. For large and medium companies: In case of incapacity to work due to illness or common accident, pay is required in the amount corresponding to 100 percent of the base salary for a period of 2 months. For as long as the employee is not entitled to protection in case of illness or common accident from the social security authorities, the employer must pay to the employee 50 percent of salary from the 3rd to the 12th month.

    In case of small and micro companies: The employee is paid, in case of illness or common accident, the amount of 50 percent of the base salary within 90 days, after which the contract is terminated by expiration if the condition of illness remains.

    Maternity/parental leave & pay

    A pregnant employee is entitled to a paid maternity leave of 3 months. The amount of the maternity allowance is equal to the average of the 2 best monthly salaries from the 6 months preceding the commencement of the maternity leave. The maternity allowance is paid directly by the employer to the employee and, subsequently, the Social Security services reimburse the employer in full. Fathers are not entitled to any leave on the birth of a child; it is only considered as a justifiable reason for absence from work for 1 day.

  • Discrimination

    Discrimination based on the following protected characteristics is prohibited: race, color, gender, ethnic origin, marital status, origin or social rank, religious beliefs, political opinion, union affiliation and language.

  • Benefits & pensions

    Both employer and employee must pay contributions to social security in Angola to cover various employee benefits (eg, maternity leave payment and retirement pension). The employer must withhold the contribution due by the employee and deliver both contributions (ie, employer and employee) to social security every month.

    Current general rates are 3 percent of the gross wage for the employee and 8 percent for the employer.

    Employees with a minimum contributory period (ie, 35 years) qualify for a retirement pension at age 60 or in cases of total incapacity.

    Employers have no legal obligation to provide complementary or supplementary social benefits in addition to the social coverage provided for by the social public scheme. However, some companies – mostly large companies or multinational companies who have their own schemes worldwide – set up and provide private complementary health and pension schemes to their employees.

  • Data privacy

    The Data Privacy Law No. 22/11, June 17 governs Angolan data privacy and determines, in general terms, how to collect, use, disclose, store and give access to "personal information."

    There is no specific regulation on employee data privacy.

  • Rules in transactions/business transfers

    Provided that the same business activity is maintained, the new employer takes the position of the former employer in the employment contracts and takes their position in respect of the rights and obligations arising from the employment relationships. This is the case even if the employment contract is terminated before the transfer. The new employer takes their position as the employer of such former employees in respect of due and non-paid credits. All credits, rights and obligations of the employer arising from the execution and implementation of the employment contract, its violation or termination are subject to a statute of limitations of 1 year starting on the day following the day of termination of the contract. Employees keep the same seniority and acquired rights which they had in the service of their former employer.

    The new employer undertakes the obligations of the former employer limited to those incurred during the 12 months prior to the modification, provided that, up to 22 business days prior to the modification, the new mployer gives notice to the employees that they must claim their credits up to the 2nd business day prior to the date scheduled for such modification. Within 22 business days following the modification of employer, the employees have the right to terminate the employment contract with prior notice, but this does not confer any right to compensation.

  • Employee representation

    Employee representative bodies are permissible but not mandatory.

    Trade unions are not common in Angola.

    In order to carry out their duties, trade union representatives are entitled to 4 paid hours a month but must notify the employer in advance of the date and number of days they require for the exercise of trade union functions. Employers are obliged to provide a suitable place for workers' meetings whenever this is requested by the union representatives. Special protections against dismissal are granted to employees who perform, or have performed, duties as union representatives, either as leaders or delegates, or members of the employees’ representative body performing union-related activities.

  • Termination

    Grounds

    Unilateral termination by the employer: dismissal based on objective grounds (ie, redundancy reasons); disciplinary dismissal with just cause (ie, based on serious breach of the employee's duties).

    Termination without cause (with notice): only for employees hired under an employment contract of service commission regime (a particular type of contract for high-level employees which provides flexibility for termination but is not common).

    Other termination causes: mutual agreement, termination by the employee (ie, termination with notice or constructive dismissal with just cause), expiration (ie, fixed-term and open-term contracts or retirement).

    Employees subject to termination laws

    All employees.

    Restricted or prohibited terminations

    Special protection against dismissal is granted to employees who perform, or have performed, duties as union representatives, either as leaders or delegates, or members of the employees’ representative body performing activities; women covered by the regime of maternity protection; war veterans as per the definition provided by the applicable law; employees under the legal age; employees with a reduced work capacity or with a disability degree equal or higher than 20 percent.

    As a general rule, a copy of the notice served on the employee must be forwarded to General Labor Inspectorate.

    Third-party approval for termination/termination documents

    Except in respect of protected employees, third-party approval is not required to terminate an employment.

    Mass layoff rules

    If economic, technological or structural circumstances occur, which may be clearly demonstrated and which involve an internal reorganization or conversion, or the reduction or the shutting down of activities, which makes it necessary to eliminate or significantly change job positions, the employer may terminate the employment contracts of the employees who perform such job positions.

    Collective dismissal rules are triggered if the dismissal involves at least 20 employees.

    Information to the General Labour Inspectorate is required. However, there is no need to obtain approval for termination.

    The General Labor Inspectorate may undertake the diligence deemed necessary for clarification of the situation and, in case of a collective dismissal, during the period in which the evaluation of the General Labor Inspectorate occurs, the employer may promote a meeting with the representative body or with the committee appointed for the purpose of exchange of information and clarification and may forward the conclusions of the meetings to the General Labor Inspectorate.

    Notice

    For individual dismissals based on objective grounds (up to 20 employees): the employer must forward, at least 30 days in advance, prior notice of dismissal to the employee or employees who occupy the job positions to be extinguished or transformed.

    For collective dismissal: the prior notice is 60 days.

    Notice periods in case of term contract: 15 business days if its duration is equal to or higher than 3 months.

    Statutory right to pay in lieu of notice or garden leave

    Payment in lieu of notice is permitted (and required if the notice period is not honored).

    Garden leave is allowed during the notice period.

    Severance

    Fair dismissal based on objective grounds (redundancy/collective dismissal):

    • Large companies: compensation corresponds to 1 base salary for each year of effective service up to the limit of 5 and an additional 50 percent of the base salary multiplied by the number of years of service that exceed such limit
    • Medium companies: compensation corresponds to 1 base salary for each year of effective service up to the limit of 3 and an additional 40 percent of the base salary multiplied by the number of years of service which exceed such limit
    • Small companies: compensation corresponds to 2 base salary and an additional 30 percent of the base salary multiplied by the number of years of service which exceed the limit of 2 years
    • Micro companies: compensation corresponds to 2 base salary and an additional 20 percent of the base salary multiplied by the number of years of service which exceed the limit of 2 years

       

      Fair disciplinary dismissal: no severance.

      Higher severance payments may be agreed and are usual as a way to avoid litigation.

  • Post-termination restraints

    A clause of the employment contract which restricts the activity of the employee for a period of time, which may not exceed 3 years from the termination of the contract, is lawful if the following conditions are met: (a) such clause is included, in writing, in the employment contract, or in its addendum; (b) the activity performed may cause real damage to the employer and may be considered as unfair competition; (c) the employee is paid a salary during the period of restriction of work: the corresponding amount will be included in the contract or its addendum, and it must be taken into account, in its calculation, the fact that the employer may have incurred in significant expenses in the professional training of the employee.

    A clause which requires an employee who benefits from professional improvement or higher level education at the expense of the employer to remain at the service of the same employer for a certain period of time, provided that such period does not exceed 1 year, in case of training of professional improvement and up to 3 years in case of courses of high level education, is also lawful if established in writing. In this case, the employee may release themselves from remaining at the employer’s service by repaying to the employer the amount of the expenses incurred by the employer, in proportion to the remaining time until the term of the agreed period. The employer that hires the employee within the period of restriction of activity in the company is jointly liable for the damages caused by the employee or for the amount not returned by the employee.

  • Waivers

    In principle, statutory rights cannot be waived and any waiver of such rights will be null and void.

  • Remedies

    Discrimination

    Fine corresponding to 5 to 10 times the average salary paid by the company.

    Unfair Dismissal

    The employee may challenge the validity of the dismissal before the labor courts.

    If the relevant court declares the dismissal to be unlawful, by final judgment, the employer must immediately re-instate the employee in the same job position and benefiting from the same previous conditions, or, alternatively, shall indemnify the employee (compensation is different depending on whether it is a large, medium, small or micro company and the cause of dismissal).

    In addition to re-instatement or the compensation, the employee is entitled to the base salaries they would have received if they had continued to perform work, until the date on which the employee finds a new job or up to the date of final judgment, whichever comes first, with a maximum limit of 6 months of base salary for large companies, 4 months to medium companies and 2 months for small and micro companies.

    Failure to inform and consult

    Not applicable.

  • Criminal sanctions

    Typically, non-compliance with employment laws leads to administrative proceedings which may lead to the payment of fines. If such non-compliance is based on violation of rights that deserve protection under criminal law, it may also lead to this type of judicial proceedings.

  • Key contacts

Employee representation

Angola

Employee representative bodies are permissible but not mandatory.

Trade unions are not common in Angola.

In order to carry out their duties, trade union representatives are entitled to 4 paid hours a month but must notify the employer in advance of the date and number of days they require for the exercise of trade union functions. Employers are obliged to provide a suitable place for workers' meetings whenever this is requested by the union representatives. Special protections against dismissal are granted to employees who perform, or have performed, duties as union representatives, either as leaders or delegates, or members of the employees’ representative body performing union-related activities.

Argentina

Argentina is a highly unionized country with approximately 3,100 active trade unions with considerable political power. There are unions in nearly all sectors or industries.

A trade union must be recognized by the Ministry. Only recognized and authorized unions may enter into a CBA. Employers cannot recognize an unauthorized union voluntarily, even for collective bargaining purposes.

The National Constitution sets out collective labor rights in its Article No. 14 (bis), guaranteeing unions the right to collectively bargain and the right to strike.

CBAs are common in Argentina. There are different types of CBAs depending on the sector in which they will be enforceable. Some CBAs only govern employees within a single company, whereas other CBAs govern employees performing certain activities in a geographical region or industry.

Australia

Under federal law, employees can choose to be represented by a union or not. Consequently, any union validly appointed to represent an employee or employees must be recognized and dealt with according to the law. There are generally no employee representatives or works councils.

Austria

Trade unions are prevalent in almost every sector. Collective bargaining agreements are very common, including industrywide collective agreements. Every employee in an applicable sector by law is a member of their trade union. Works councils are very common and may be established in every business with at least 5 employees.

Bahrain

Trade unions are permissible in Bahrain, and employers are required to consult with them in the event that an employee is retrained to perform different job duties from the work originally agreed upon. Employees are also entitled to strike in defense of their interests according to the Labor Law.

Belgium

Trade unions are prevalent. Approximately 50 percent of workers are members. Works councils must be installed by social elections if the company has at least 100 employees. Committees for Prevention and Protection at Work must be installed by social elections if the company has at least 50 employees. Industry-level collective bargaining agreements, concluded within the joint committees (ie, permanent bodies on the industry level in which an equal number of employers' federations and trade unions are represented and that have as their main task concluding industrywide collective bargaining agreements and mediating in social conflicts) are common.

Brazil

Union representation is mandatory, and all employees are subject to industrywide collective agreements. Works councils are uncommon. However, Law 13,467, which became effective on November 13, 2017, provides for a commission of employees for companies whose workforce exceeds 200 individuals. The number of commission employees will depend on the size of the workforce, ranging from 3 to 7 members.

Canada

In Canada, the level of union density continues to decline, particularly in the private sector. Unions continue to have high levels of representation in the broader public sector, especially in certain traditionally unionized industries such as automotive, construction and transportation. Many businesses have no union or other worker representation. There are no works councils. Industry-level collective bargaining agreements are rare outside of certain industries in Quebec and the construction industry.

Chile

Chile recognizes the right of "freedom of unionization," which includes the right to be part or not to be part of a union.

Statutes regulate the processes and procedures necessary for the formation and management of unions.

Unions only represent its members during collective bargaining and in collective claims. In order to act in particular claims of its members, the union must have a mandate given by that individual.

Unions cannot act on behalf of non-unionized staff.

There are no works councils or similar employee representative groups.

China

Trade unions are prevalent in state-owned enterprises. In most cities, local regulations require employers to set up employee representative councils (ERC). However, failure to set up an ERC is not subject to penalties. Many businesses have no union or other worker representation. Industry-level collective bargaining agreements are uncommon.

Colombia

Trade unions are prevalent in certain sectors, including the sugar, railway, automotive, oil and mining industries as well as the public sector, especially education and energy.

A minimum of 25 workers is required to maintain or establish a trade union in Colombia. So, where the company employs at least 25 employees, the employees may establish a company-level union. Only the employees may form a union.

There are no work councils or other employee representatives.

Czech Republic

Czech labor law recognizes several types of employee representatives: trade unions, works councils and occupational health and safety representatives. Trade unions are most common; 15 percent of employees are union members. Many businesses have no union or other worker representation.

Denmark

Denmark is characterized by a high level of unionization, and there is a broad acceptance that the parties of the Danish labor market regulate and govern the labor market without any, or only minimal, government intervention.

Therefore, it is left to the organizations to conclude collective agreements that regulate working conditions in individual workplaces. Collective agreements regulate areas such as salary, overtime payment, working hours, pension, termination of employment, supplementary training or education and other terms of employment.

All employers with more than 35 employees are legally obliged to establish an employee forum (ie, a works council). The forum may be used to inform employees of matters of material importance to the employees. However, several collective agreements contain provisions enabling employees – or management – to request the establishment of a works council. In this case, the terms of the collective agreement apply, provided it meets the minimum statutory requirements. The works council must consist of an equal number of employee and management representatives.

Employees may also elect members to the board of directors, provided that 35 employees or more are employed, and that a majority of them request representation in the board of directors.

Finland

Trade unions are prevalent across all sectors, and 70 percent of Finnish employees are members of a trade union. Employees may be represented either by a shop steward elected based on the applicable CBA or by a representative elected based on the Employment Contracts Act, as well as an industrial safety delegate in occupational health and safety matters. Employers must negotiate or consult with employee representatives, or the whole workforce if there are no representatives. There are no national works councils, and trade unions do not have a general right to information and/or consultation or co-determination rights. Employees do not have the right to participate in any management body of the employer.

France

The Macron reforms have merged the employee delegates, the works council and the Health and Safety Committee into a single employee representative body referred to as Social and Economic Committee (Comité Social et Economique or CSE). A CSE must be put in place in all companies that reach a threshold of 11 employees for 12 consecutive months. The CSE's rights differ depending on the company's headcount.

Since January 1, 2018, a CSE has been mandatory to implement when the employee threshold (see above) had been met. However, in circumstances where an employee representative body already existed within the company, the company was required to implement a CSE on the expiry of the existing bodies' mandates, and by December 31, 2019 at the latest.

Union representatives may be appointed in establishments with at least 50 employees. In companies with fewer than 50 employees, a member of the CSE may be appointed as a union representative.

Virtually all companies are subject to industrywide CBAs.

Germany

Works council: The elected works council plays a major role in the everyday lives of larger German businesses. By law, employees in every business of at least 5 employees may form a works council at their own initiative. The works council has information, consultation and co-decision rights in the area of hiring, positioning and dismissals, internal organization of the business, restructuring and personal planning, among others. Employer and works council shall form works agreements to regulate the affairs of the business, except working time and remuneration, which are reserved for collective agreements with a trade union. Works councils may not call industrial action.

Co-determination on supervisory board level: Companies with a regular workforce over 500 employees in Germany establish a supervisory board with 1/3 elected employee representation and a fairly limited scope of duties. If the regular workforce in Germany exceeds 2,000, 1/2 of the members of the supervisory board are elected employee representatives with a fixed list of duties. The chairman of the supervisory board is, by law, always nominated from the shareholder's side and has a casting vote, ensuring control by the business owners.

Trade unions: 18 percent of the German workforce are members of a trade union. Trade unions are prevalent in certain sectors (eg, manufacturing, building, transport and the public sector). Trade unions deal with employer associations or individual employers. Once represented businesses agree on a collective agreement, they are widely used by other businesses as reference. Formation of collective labor organizations is a constitutional freedom, as is the right to avoid them.

Hong Kong, SAR

Although Hong Kong residents have the right and freedom to form and join trade unions, the level of employee participation in trade unions is relatively low, and Hong Kong enjoys a relatively harmonious climate of industrial relations. Collective bargaining agreements are uncommon.

There are no employee representatives or works councils.

Hungary

Employees are entitled to establish trade unions within the work organization.

A works council may be elected where an employer employs more than 50 employees. If the number of employees exceeds 15 but does not reach 51, then a works council representative may be elected.

India

In India, the right to form a trade union flows from the fundamental right to freedom of association in the Constitution. Unions must be composed of 7 or more people and must apply to be registered. Indian trade unions are conferred the same status as a body corporate, enjoy perpetual succession and have a common seal. They may sue and be sued in their name. Further, the provisions related to trade unions will be subsumed under the IR Code when it comes into force.

IDA renders both employers and trade unions liable for penal sanctions in the event they engage in unfair labor practices.

A collective agreement is an understanding between workmen represented by their trade unions and employers.

Under the IDA, it is unfair for a recognized trade union and employer to refuse to bargain collectively in good faith with the other party.

Indonesia

Any group of at least 10 employees may establish a labor union which will have the right to:

  • Enter into a collective labor agreement with the employer
  • Represent workers in industrial disputes and at manpower institutions
  • Establish institutions (eg, cooperatives) or carry out activities relating to the improvement of the welfare of the workers and
  • Carry out other legal activities in the area of industrial relations.

Criminal sanctions may be imposed on anyone, including the employer, who engages in certain anti-union activity.

Ireland

Trade unions are prevalent in the manufacturing, transport and public sectors. Many businesses have no union or other worker representation, and works councils are uncommon. Industry-level collective bargaining exists.

No right of recognition for a trade union.

Israel

Trade unions are prevalent in certain sectors (such as industry, transport and the public sector). Many businesses have no union or other worker representation; however, an employer may not object to the incorporation of a workers' union, and is required to negotiate with the union in good faith. Industry-level collective bargaining agreements are common in certain sectors (such as transport and the public sector). There are no works councils, but trade unions may be entitled to certain information and consultation rights.

Italy

All employees have the right to form, or become members of, labor associations, as well as the right to perform labor-related activities. On the initiative of the employees, a works council may be established in every plant with more than 15 workers within the trade union's associations that have executed the collective agreement applied in the company. Employees' representatives are granted certain rights (eg, additional protection in case of transfer and dismissal).

Most companies are subject to mandatory industrywide collective bargaining agreements.

Japan

Labor unions are protected by the Constitution and by statute. All employees have the right to form unions.

There are 2 types of collective agreements. Most common is a labor-management agreement, which is an agreement between management and either the representative of the majority of employees in the workplace or a labor union to which a majority of the employees belong. The second type is a collective bargaining agreement (CBA) which is between a labor union and an employer only. CBAs are not particularly common in Japan the proportion of the workforce in Japan that is unionized has fallen below 20 percent, according to recent statistics.

There are no works or labor management counsels.

Kenya

Trade unions are popular with low-skilled staff and civil servants, such as teachers, doctors and nurses. They are almost nonexistent among the managerial staff of most private businesses.

Kuwait

Foreigners are not permitted to form any unions, according to the Kuwaiti Labor Law.

Kuwaiti nationals may form or join a labor union, and only 1 labor union per sector may be formed in the country (eg, a union for engineers or a union for lawyers). Only associations expressly designated for an Islamic purpose, or granted legal status by the government, are permitted to meet openly and freely.

Luxembourg

Trade unions: Employees as well as employers are organized on a voluntary basis into a number of trade unions, trade and professional federations. Membership is optional.

Staff delegation: A staff delegation must be set up in every business in the private sector employing at least 15 employees under an employment contract during the 12 months prior to the date on which the announcement of elections is made. Joint works councils in every establishment employing at least 150 employees were abolished by the law of July 27, 2015, and their competences were transferred to the staff delegation as from the social elections, on March 12, 2019.

Staff delegation at the level of an economic and social entity: Several companies together form an "economic and social entity" when they have a shared management, identical and complementary activities, a community of employees working with the same interests and a comparable social status. Where such an entity exists, a staff delegation may also be established when requested by at least 2 different companies forming part of the entity.

Malaysia

Employers and employees have the right to form trade unions, subject to the provisions of the Trade Unions Act 1959 and Industrial Relations Act 1967.

Only a small percentage (less than 10 percent of the total labor force) of employees in Malaysia are organized into trade unions. However, trade unions are very common and established in certain industries, such as banking, manufacturing, and plantations.

Mexico

Trade unions are prevalent in certain sectors, such as the sugar, railway, automotive and mining industries as well as the public sector, especially the education and energy industries. A union may be formed by at least 20 employees in a certain workplace; however, employees who are affiliated with an existing union may request, through that union, to sign a collective bargaining agreement with their employer.

There are no works councils or other employee representatives.

Morocco

Trade unions are active in sectors like the automotive, steel and manufacturing industries.

Companies with at least 10 permanent employees must elect employees' delegates. Non-compliance with the provision of the Moroccan Labor Code regarding election of employees' delegates may lead to a fine of up to MAD30,000.

Companies with more than 50 permanent employees must set up a:

  • Work committee and
  • Health and safety committee.

Non-compliance with this provision of the Moroccan Labor Code may lead to a fine of up to MAD25,000. Collective bargaining agreements are uncommon.

Mozambique

Trade unions are prevalent in all sectors of activity in Mozambique. Employees have the right to form and belong to organizations of their choice for the defense and promotion of their socio-professional and business rights and interests. No employee may be compelled to be a member of a union. Employers are not allowed to fund a union's activity. Unions may engage in collective and company-level agreements. There is a central union (ie, industrywide union), but, at the company level, there may be a union committee formed by employees. This union, for example, offers its opinion on disciplinary proceedings and participates in salary negotiations. In the absence of a union committee, the employer must go to the industrywide union. This is to ensure the rights of the employees are protected regardless of the existence of a union committee at the company level. This is essentially the equivalent of a works council.

Myanmar

Labor organizations (that is, the labor organization of the employer's trade/establishment, which function as a union) represent employees in Myanmar. The employer must recognize the labor organizations relevant to its industry. If there are more than 30 employees, a Workplace Coordinating Committee (WCC) must be established. The WCC is formed by 2 elected worker representatives and 2 employer representatives. If a labor union is already active, then the worker representatives come from the union. The employer must assist as much as possible if the labor organization requests help. Labor organizations have the right to participate in collective bargaining on behalf of the workers. The employer must not discriminate against employees who are union/labor organization members. 

The labor organization shall decide who should be its representatives, who carry out negotiations with the employer on terms and conditions of employment and in settling the collective bargaining matters of workers in accordance with labor laws.

The employer must allow any worker who is assigned any duty on the recommendation of the relevant executive committee of a labor organization to perform such duty not exceeding 2 days per month unless otherwise agreed.

Netherlands

Trade unions are prevalent in a number of sectors. Works councils are common and have significant rights. If the company has 50 or more employees, the company is obliged to establish a works council. If there are more than 10 employees, but fewer than 50 employees, the company must create the possibility to meet with the employees twice a year. Industry-level collective bargaining agreements are common.

New Zealand

In New Zealand, an employee may choose whether or not to be part of a union. Any union validly appointed to represent an employee or employees must be recognized and dealt with according to the law. Employers must provide new employees with an Active Choice Form, prescribed by the Ministry of Business, Innovation and Employment, which seeks information about whether the employee intends to join a union.

Nigeria

Nigeria has various trade unions, which are prevalent across all sectors of the economy. The Constitution of the Federal Republic of Nigeria and the Trade Union Act provide that membership of a trade union by employees shall be voluntary. Where an employee elects to join a trade union, the employee shall not be restricted, victimized or otherwise discriminated against by the employer.

An employer is also required to deduct dues from the wages of all employees who are registered trade union members and remit such deductions to the registered office of the applicable trade union.

It is a fundamental right to form or belong to a trade union of one's choice. The trade unions representing the employees sometimes negotiate conditions of employment for their members with the employers or the trade bodies representing the employers. The outcome of the negotiation is usually contained in a collective bargaining agreement (CBA). The provisions of the CBA are generally unenforceable by individual employees unless incorporated in the employment contract or policies.

There are no other forms of employee representation.

Norway

Trade unions are common. Requirements for safety representatives and environments committees apply. Several obligations to consult with the employees' elected representatives.

Oman

Permitted under the Labor Law.

Peru

Trade unions are prevalent in certain sectors (eg, manufacturing, mining and infrastructure). Unions are protected under the Peruvian Constitution, which recognizes the right of an employee to join unions, collective bargaining and strikes. Union leaders are specially protected against unfair dismissal.

Philippines

It is the right of the employees to form, join or assist in the formation of a labor organization of their own choosing for purposes of collective bargaining through representatives of their own choosing and to engage in lawful concerted activities for purposes of collective bargaining, or for their mutual aid and protection.

Apart from unions, there are no works councils or other collective groups.

Poland

Trade unions

A single-establishment trade union can be formed either as:

  • A unit of a nationwide trade union or as
  • A new, separate trade union organization, upon a resolution on its establishment, passed by at least 10 persons entitled to establish trade unions.

All employees and other individuals performing work (eg, civil law contractors) are entitled to form and join trade unions. Nobody may be discriminated against for being or not being a member of a trade union. Trade unions represent all individuals irrespective of their membership. In individual matters, trade unions solely represent the rights and interests of their members or of unassociated individuals upon their request. Employers have multiple, various obligations towards the trade unions operating at their entities. Trade unions are granted certain rights – in particular, trade union leaders enjoy special protection against dismissal.

Works council

Employees' representative body, elected by the employees, may be established within a company that engages at least 50 employees, excluding state enterprises, mixed-capital entities engaging at least 50 employees and public institutions. The employer has an obligation to inform and consult with its works council in matters specified by law. Special protection against dismissal for works council members.

Portugal

Employee representative bodies are permissible, but not mandatory. The employees of a company may take the initiative to set up the following representative bodies:

  • Works council: The members are appointed by the employees, and their purpose is to represent the interests of the employees of that company. In most companies in Portugal, there is no works council. The practice is that they exist only in major companies.
  • Union delegates: Elected by the employees affiliated with a specific union. There may be more than 1 union with representatives in a company.
  • Security and health representatives: To supervise issues related to security and health. They are not common in Portugal.
  • European Works Council (EWC).

Trade unions are prevalent in certain sectors. Industry-level collective bargaining agreements are common in almost all industrial sectors (eg, automobile, chemical, transportation, automobile parts production, pharmaceutical, civil construction and metallurgy).

The employees' representatives are entitled to time off to exercise their duties with payment (with some time limits) and may convene general meetings of employees to take place outside or inside the working schedule (in the latter case, for a maximum 15 hours per year).

The works council has some rights, such as the right to obtain information on some matters of relevance for the company and employees; the right to consultation on some specific matters of relevance for the employees, as defined by the law (though the works council does not have the right of veto in respect to any employer's decisions); the right to meet periodically with the management; and the right to negotiate a collective labor agreement specific to the company, provided the unions representing the company's employees delegate that power to the works council, but this is not common.

Qatar

Trade unions/workers committees are not common in Qatar and are rarely formed, but they are permissible provided certain conditions are fulfilled. Employees in workers organizations may go on strike if an amicable settlement has become impossible and if they have complied with a number of Labor Law requirements.

Romania

The main employee representative bodies are:

  • Employee-elected representatives
  • Trade unions

Works councils are not expressly regulated unless there is a European works council.

Collective bargaining agreements may be executed:

  • At the company level (negotiated between the employer and the competent employee representative body)
  • At the group company level or
  • At the sector (ie, industry) level. In this case, an employer must be a signatory to such an agreement in order for it to apply to their employees, although extension to the entire sector is possible in certain circumstances.

Russia

Employees may be represented either by trade unions or by another employee representative(s). Under current laws, in order to create a basic trade union organization or another representative body, it is sufficient to have 3 employees who should jointly decide to create a trade union, elect the union leader and approve the regulations. It is not necessary to register the trade union as it is deemed to have been created upon the adoption of all the above decisions. There are no works councils as defined in EU courts.

Saudi Arabia

Labor unions are illegal in Saudi Arabia. Workers’ committees and similar organizations are also not permitted. Instead, HRSD and the Labor Courts have jurisdiction over safeguarding employment relations in the KSA. However, the Ministry is in the process of establishing the general union of Saudi workers, which will include all Saudi employees. In general, these Ministry labor unions are allowed for entities employing 100 or more Saudi employees.

Singapore

Trade unions are administered by, inter alia, the Industrial Relations Act (Cap. 136) of Singapore (IRA), the Trade Disputes Act (Cap. 331) of Singapore (TDA) and the Trade Unions Act (Cap. 333) of Singapore.

The IRA regulates relations between employers and employees and provides the legal framework to prevent and settle trade disputes by collective bargaining, conciliation and industrial arbitration. Individual disputes fit within the definition of trade disputes under the TDA. The TDA defines illegal industrial action and illegal lock-outs and provides penalties for the same.

Collective agreements are common in Singapore within specific industries, such as transport and manufacturing. Even where a trade union has been statutorily recognized but no formal collective agreement has yet been entered into, disputes may potentially still be referred to the Industrial Arbitration Court and decided in accordance with principles of equity and fairness (rather than strict contractual principles).

Slovak Republic

Trade unions are prevalent in certain sectors (eg, public sector, health services and manufacturing). Many businesses have no union or other employee representation. Works councils may operate in businesses with at least 50 employees. In businesses with at least 3 employees and no more than 50 employees, an employee trustee may be in place.

Where they exist, a works council or employee trustee is entitled to joint decision-making in the form of agreement or giving prior consent only insofar as the working conditions or employment conditions for which joint decision-making with the works council or employee trustee as required are not already regulated by collective agreement.

South Africa

Employees are constitutionally entitled to join a trade union, to be represented by such trade union, and to strike. Industry-wide collective bargaining agreements may be concluded, which apply to parties in a bargaining council (ie, a body formed by organized labor and organized employers for a particular sector, which forms the forum for industry wide collective bargaining). The result is an extensive framework of collective bargaining, organizational rights, collective agreements and bargaining councils that play a central role in most commercial and employment activities.

South Korea

Employees have the right to establish and operate trade unions, and collective bargaining has a binding legal effect.

Each workplace with 30 or more employees must have a labor management council (LMC). LMCs are composed of an equal number of members representing employers and employees, and there shall be no less than 3 and not more than 10 members.

Spain

Both trade unions and works councils occupy a pre-eminent position in Spanish labor law. Industry-level CBAs are very common. They may co-exist with CBAs agreed at a company level.

In companies with 11 to 49 employees (or in companies with 6 to 10 employees, if requested by the majority of employees), employees may initiate elections to choose personnel delegates; in companies with 50 or more employees, they may hold elections to a works council. Personnel delegates and works councils have the same rights. The company cannot initiate such elections, but also cannot hinder employee rights in that regard.

Sweden

Sweden has a high rate of trade union affiliation among employees, totaling around 75 to 80 percent. The Co-Determination Act (medbestammandelagen) consists of rules regulating collective agreements, rules of procedure regarding negotiations, consultations and employee representation. Pursuant to the Co-Determination Act, both employees and employers have the right to belong to an organization of employees or employers and to exercise the rights of membership in such organization. The right of association may not be infringed upon. Collective bargaining in Sweden is centralized, and historically, bargaining in the private sectors has taken place on 3 levels: national (between the Confederation of Swedish Enterprises and the employee federations); industrywide (between industrywide organizations on both sides); and local (between the company and the local union). Legally binding agreements are concluded at all levels of bargaining. Traditionally, the industrywide level has been the focus of bargaining, and there are industrywide collective agreements in almost every sector of the Swedish economy.

The concept of works councils, aside from European Works Councils, is not recognized in Sweden. Instead, employees' influence is safeguarded by the trade unions.

Switzerland

Workers are entitled to elect a representative in companies with more than 50 workers. Trade unions are prevalent in certain sectors. Industry-level collective bargaining agreements are common. Trade-union arbitrators often act as conciliators when there is a collective labor dispute.

Taiwan, Republic of China

Unions are allowed, but they are highly regulated. 30 percent of the labor force are union members.

For businesses with more than 30 employees, which are regulated by the LSA, it is mandatory to have a labor management council. In practice, however, these councils are rarely used as many larger corporations instead have unions.

Thailand

Employees representative in a welfare committee

Under the LPA, in a place of business with 50 employees or more, an employer must arrange for the establishment of a welfare committee comprising at least 5 employee representatives.

Employee committee

Under the LRA, in a workplace of 50 or more employees, the employees may establish an employees' committee. The employer must organize a meeting with the employees' committee at least once every 3 months or upon the request of more than 1/2 of the employees' committee members or the labor union. The purpose of the meetings is to:

  • Provide for employees' welfare
  • Consult about working regulations which may be beneficial to the employer and employees
  • Consider any complaints by the employees and
  • Compromise and settle disputes in the workplace.

Employees representatives

Under the LRA, any request by employers or by employees to make or amend a working conditions agreement must be made in writing to the other party. If employees submit the request, it must specify the names and signatures of the employees supporting it, which must be not less than 15 percent of the total number of employees who hold interest in such a demand. The employees have the right to elect representatives of no more than 7 people to participate in negotiations about working conditions.

Labor union

The LRA contains detailed provisions on the duties, formation and powers of labor unions. Certain rules and requirements must be satisfied by officials before a labor union may be recognized. The labor union may assist in requesting the creation or amendment of a working conditions agreement, settling disputes, acknowledging arbitral awards and employee strikes.

Tunisia

All companies with at least 20 permanent personnel are required to have a staff representation organization.

Turkey

A trade union representing at least 1 percent of the employees who are engaged in a given branch of activity and more than half of the employees employed in the workplace of a company or, if there is more than 1 workplace, 40 percent of the employees employed in all workplaces of the company at the enterprise level shall have the power to conclude a collective bargaining agreement covering the workplace or workplaces in question.

Apart from the union's workplace representatives, work councils or employee committees are not regulated under the Law on Unions and Collective Bargaining Agreement. The union's workplace representatives are appointed by the union, which is authorized to execute a collective bargaining agreement and appointed from among the employees working in the workplace who are members of such union. If there are up to 50 employees, at least 1 representative may be appointed; 51 to up to 100 employees, 2 representatives; 101 to up to 500 employees, 3 representatives; 500 to up to 1,000 employees, 4 representatives; 1,001 to 2,000 employees, 6 representatives; and more than 2,000 employees, 8 representatives.

Uganda

Labor unions are prevalent in certain sectors (eg, manufacturing, transport and the public sector). Many businesses have no union or other worker representation. Works councils are uncommon. Industry-level collective bargaining agreements are uncommon.

Ukraine

Local trade unions may be established by any 3 employees of a company. According to the law, a trade union should notify an employer of its establishment. However, an employer cannot restrict or prohibit the establishment of a trade union. Employees' representatives are elected at the general meeting of employees. In practice, trade unions are usually not elected in small companies, and they are more influential for mid-sized and large companies, especially for those using special working regimes and have special conditions of work.

Trade unions must be notified and, in some cases, must consent or approve before employers take certain employment actions, including redundancy, dismissal of a trade union member or introduction of an unusual working regime. On the other hand, elected employee representatives have limited authority as compared to trade unions and usually act, if a trade union is not established.

Under Ukrainian laws, each Ukrainian entity that has employees must conclude a collective agreement with its employees. If no collective bargaining is initiated by either an employer or employees (and, consequently, no CBA is concluded), no negative consequences would arise for an employer. Such agreement is negotiated by a trade union, if it exists, or employee's representatives and, after it is approved by all parties, must be registered by the local government. There are no work councils.

United Arab Emirates

No employee representation exists. Membership in an unauthorized trade union and industrial action are both criminal offenses for which an individual could be fined and imprisoned, and, in the case of expatriate workers, deported.

United Kingdom

Trade unions are prevalent in certain sectors (eg, manufacturing, transport and the public sector). 25 percent of workers are members, but most are employed in the public sector. Many businesses have no union or other worker representation. Works councils are uncommon. Industry-level collective bargaining agreements are uncommon.

United States

Trade unions are common in certain sectors. The US private sector had a unionization rate of 6.3 percent in 2020, compared to 6.2 percent in 2019. Employees' rights to organize and engage in "concerted activity" regarding their terms and conditions of employment are protected under the National Labor Relations Act (NLRA), whether or not they belong to a union or work in a unionized workplace.

Venezuela

Workers and employers are entitled to organize and incorporate unions. A minimum of 20 workers is required to form a union. There are 2 basic types of unions under Venezuelan labor laws: companywide unions that organize workers of a single company, and industrywide unions that organize workers in an entire industry regardless of the company that they belong to and the position they hold.

Under certain conditions, the workers may exercise their right to negotiate collective bargaining agreements and to resort to collective action, including strikes.

All employers, regardless of number of employees, are also required to set up a workers’ council and a health and safety committee.

Work councils: Workers must elect between 3 and 7 employees to form the workers’ council.  Among those members, the workers’ council must include a female, an individual aged 15 to 35 and a member of the national militia. Workers’ councils oversee the employer’s production process, including distribution and supply. They do not have decision-making powers, but they can propose that the employer adopt measures to enhance its productive process. There are no consultation obligations from the employer associated to workers’ councils either.

Health and safety committee: Workers and employers must set up a health and safety committee with representatives from both sides. The number of health and safety representatives is set by law and depends on the company’s headcount. The health and safety committee has various tasks including monitoring health and safety conditions at the workplace and preparing and approving the company’s health and safety program.

Vietnam

Trade unions act as employee representatives in Vietnam. The employer is responsible for encouraging and providing favorable conditions for the establishment of a trade union within the workplace. Trade unions participate in the improvement of social legislation, represent workers in the negotiation and execution of collective agreements, and assist in labor disputes. An employer is prohibited from being prejudiced against employees based on their participation in a trade union.

Employers are not obliged to establish a trade union, but they are intended to create a favorable environment for their establishment. In order for a trade union at enterprise level to be established, 5 or more employees must unite and request recognition by the higher-level union. Employees who are trade union officers may conduct trade union activities during working hours. Such employees have specific protection against termination of their employment. All employers and enterprises, regardless of whether a trade union is established or not, including foreign-invested enterprises, must pay into the trade union fund at a rate of 2 percent of their payroll. This trade union fee paid by the employer is a permissible deduction when assessing corporate income tax.

In practice, production companies tend to have a union, whereas service companies do not.

In parallel to a grassroots trade union, the Labor Code 2019 enshrines the right of employees to set up or join a labor representative organization, called an employee organization, that is independent from the existing trade union system managed by the Vietnam General Confederation of Labor.