Articles

Payment of Wages in Subcontracting Relationships - 2nd part

Written by Mgr. Peter Neštepný

Which employees does this provision apply to?

It applies to the employees of the direct subcontractor of the service provider in the Slovak Republic who have not been paid wages for performing the aforementioned construction work.

From the wording used by the legislator, it is clear that not all employees of the direct subcontractor will be protected by this provision, but only those who actually performed the relevant construction work. Only practice will likely show whether it will be possible in every case to reliably verify that the employee indeed carried out such work to the extent claimed for the service provider (i.e., whether in practice the subcontractor’s employee X in October 2024 devoted 100% of their working time to construction work on building Y performed for service provider Z). In this regard, the service provider will have to "rely" on the information provided by the employee in the wage payment request or verify and confirm it according to their capabilities.

What is the deadline for the employee to request wage payment from the service provider?

The Labor Code stipulates a six-month period for delivering a written request for wage payment from the wage’s due date. Upon expiration of this period, the employee’s right to claim the wage will cease.

The due date of the wage is essentially information that the service provider may not have (other than from the employee through the wage payment request or directly from the subcontractor). This might lead to uncertainty about the exact duration of this period. In general, wages are due in arrears for a monthly period, and no later than the end of the following calendar month, unless otherwise agreed in the collective agreement or the employment contract (Section 129(1) of the Labor Code). This should be kept in mind, and the data provided by the employee should be verified (by requesting information from the subcontractor), particularly in cases where the wage payment request comes at a time that may be considered borderline based on the above.

What is the extent of the service provider's responsibility?

The service provider is not responsible for the entire unpaid wage of the employee of the direct subcontractor, but their liability is limited to the amount of the minimum wage applicable at the time of the work performed within the subcontracting relationship, for each hour of work performed, up to the difference between the minimum wage applicable at the time of the work and the wage paid by the subcontractor for the performance of this work.

In the event that no wage was paid to the employee, the liability will be limited to the amount of the minimum wage; if the employee was partially paid, the amount paid will be deducted from the minimum wage.

What should the employee’s request contain?

It must include the facts decisive for determining the right to wage payment, which are demonstratively listed in Section 130a(3) of the Labor Code:

a)  Identification details of the employee,

b)  Identification details of the employer,

c) The amount of wages the employee is claiming,

d) Information about the due date of the wage the employee is claiming,

e) The amount of the wage paid by the subcontractor for work performed, if any,

f) The period for which the employee is claiming the wage,

g)  The type and extent of work performed within the subcontracting relationship by the employee,

h) The method of payment, either in cash or to a bank account, including the details necessary for the wage payment..   

The service provider may also request information on other matters beyond those listed in points (a) to (h) above, but these must be essential for assessing the employee's right (i.e., the information must be justified and directly affect the service provider’s ability to evaluate the employee's request).

Does the service provider have the option to verify the information provided?

The Labor Code defines a duty of mutual cooperation between the employee, the subcontractor, and the service provider. Naturally, this duty should be reasonable and limited to the purpose and content of Section 130a of the Labor Code.

Can the service provider refuse to pay the wage?

Yes, if the legal requirements are not met. In case of disagreements, it will become a dispute between the employee and the service provider, which will be decided by the relevant court.

What is the deadline for the service provider to pay the wage?

The deadline for wage payment is 30 days from the date the right to wage payment is asserted. The service provider is required to make deductions from the wage only under the conditions specified in Section 130a(5) of the Labor Code. Generally, they are not required to make deductions and remit them, and they calculate the net wage in the context of deductions that would otherwise be made by the employer.

Does the service provider have any information obligations?

Yes, the service provider must inform both the employee and the employee's employer (subcontractor) about the wage payment or its refusal (either in full or in part) and the reasons for such action.

Is the subcontractor obliged to reimburse me for the wage paid?

Yes, you are entitled to demand reimbursement from the subcontractor for the wage paid to their employee.

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