Accounting, Payroll, Tax & Legal since 1989

CONTRACTUAL PENALTY FOR FOLLOWING THE OCCUPATIONAL HEALTH AND SAFETY REQUIREMENTS AS A NEW MEASURE FOR THE EMPLOYER

5,128 occupational accidents were registered in 2018 according to the preliminary statistics published by the Labour Inspectorate of which 10 were fatal.


An occupational accident is a health damage of an employee or death of an employee which occurred during the performance of a duty assigned by an employer or during other work performed with the employer’s permission, during a break included in the working time, or during other activity in the interests of the employer.

Prevention of occupational accidents requires strict compliance with the occupational health and safety requirements. But, in practice, there have been problems, where the employer has complied with the legal requirements, but the employee do not perform the occupational health and safety requirements or violates these consciously.


The employer shall be responsible for the occupational accident if they are guilty of the damage caused by the occupational accident. For example, the employer shall be responsible if the cause of the occupational accident was insufficient training or lack of the protective equipment. The fault of the employer is presumed, hence in case of the dispute, the employer has to prove that they have complied with the legal requirements.

In the situation where the employee did not comply with the occupational health and safety requirements or violated theses intentionally, the only option for the employer until 01 January 2019 was to give a warning. Although giving a warning is one of the assumptions for extraordinary cancellation of the employment contract by the employer, giving a possible warning might not be a sufficient tool for influencing the employee. The final goal shall not be termination of the employment contract but continuation of the employment relationship. Consequently, an option for application of a contractual penalty has been introduced in the law.

Contractual penalty can be agreed in case of the violation by the employer as well as the employee. The distinction still applies for the contractual penalty imposed on the employee because for its validity there are several conditions in the law that all must be performed.

The contractual penalty agreement must establish specific activities of the employee and the employer, that are treated as violation of the occupational health and safety requirements and that may endanger the health of the employee. For example, such activities may be failure to use the protective equipment, ignoring the safety requirements of the machinery, equipment and other tools, and other.

It is also necessary that this agreement on the contractual penalty is concluded in writing. The law also regulates the size of the contractual penalty applied to the employee. The contractual penalty agreed for violation of the occupational health and safety requirements shall not exceed the monthly average remuneration of the employee. There is no upper limit for the contractual penalty imposed on an employer.

The employer has no right to detain the contractual penalty from the employee’s remuneration. If needed, the employer has to demand the contractual penalty from the employee via the labour dispute committee or the court. Warning must precede the demand of the contractual penalty. If the employee still continues to violate the safety requirements, the employer has the right to demand the contractual penalty.

Consequently, the legislative authority has hence given the employer an additional option to influence their employees to comply with the occupational health and safety requirements but use of this option means that the employer must certainly perform all legislative terms and conditions. Otherwise the contractual penalty agreement is void.

Lawyers of the Advisory Unit of Leinonen OÜ can advise the employers in the specified area and help formulate the appropriate contractual penalty agreement to the employment contracts.

24.04.19


Latest articles

5

Jun

As of 1 July 2019, the public sector...

26

Apr

Lowered tax rate of dividends – 14%

24

Apr

CONTRACTUAL PENALTY FOR FOLLOWING THE OCCUPATIONAL HEALTH AND...

Contact

Email again:
Services