The Council of Ministers approved on May 9, 2013 the draft law that creates the Labour Compensation Fund (LCF) and the Labour Compensation Guarantee Fund (LCGF).

The LCF is activated by the employer and aims to ensure the payment of half of the compensation due to the employee by virtue of the termination of his employment contract. The employer should deliver 0,925% of base contribution and seniority payments for each employee covered.

The LCGF could be activated by the employee if the employer does not pay half of the above mentioned compensation. For this Fund the employer should deliver 0,075% of base contribution and seniority payments for each employee covered.

Only the employment agreements concluded after the approval of the law will be subject to these new rules.