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Work is usually done under an employment contract, but a contract for services or an authorization agreement could also be concluded. Which contract should be concluded for the specific job? There is no single answer to this question. One should first understand what is the purpose of concluding one or another contract, and what is agreed on with each.
Main Differences Between the Employment Contract and Other (Service Provision) Contracts Under the Law of Obligations
Employment Contract |
Service Provision Contract |
Employer manages and controls the employee. |
Service provider can choose the working time and place. |
Written; helps to avoid disputes about agreed conditions. |
Can also be oral. |
In general, without a term. Fixed-term if the work is of temporary nature. |
In general, fixed-term. |
Working time and overtime is limited, resting time is set. |
Unrestricted work, no resting time is foreseen. |
When working full-time, right to receive the minimum salary. Employer must pay the taxes. |
No minimum rate is set, payment of taxes must be agreed. |
Right for a paid vacation. |
Not entitled for a vacation. |
Limited material liability. |
Liability for the entire damage. |
Employment contract termination only on legally stipulated grounds; compensation is paid for redundancy. |
Law does not stipulate contract termination grounds; no prior notification nor compensation payment obligation. |
Employer must guarantee working conditions safe for life and health. |
Service provider must create safe working conditions. |
To resolve a dispute, right to turn to a labour dispute committee or court. |
To resolve a dispute, only right to turn to court. |
As the comparison of contracts shows, the employment contract is certainly to be favoured as it gives greater rights and protection to the employee. Recommendation: prefer the employment contract!
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