Employment contracts Montenegro

What should an employment contract in Montenegro include? 

The following information should be included in every employment contract in compliance with Montenegrin labor laws:

• The employer’s and employees’ personal details, including names, addresses, contact details, and other relevant information.
• A comprehensive description of the job role and specifications regarding duties, responsibilities, and rights. 
• A payschedule including the salary or wage and benefits for the employee.
• A workschedule including the days and hours of the week when the employee will work.
• Specifications regarding termination of employment, including notice period and severance pay if applicable.
• Policies and clauses to protect the employer’s confidential information and trade secrets.

It’s important that both parties are aware and familiar with the contract’s terms and conditions before signing it.

What types of employment contracts exist in Montenegro?

The most common types of employment contracts in Montenegro are:

1. Employee contracts

Under this category, there are two major types of employment contracts:

• Indefinite-term employment contracts – As their name implies, indefinite-term or permanent employment contracts don’t feature a fixed end date. These contracts can be legally terminated by either of the parties in adherence to the country’s labor laws and the termination policies within the contract. Indefinite-term employment is preferred as it provides job stability and security for both the employer and the employee.
• Fixed-term employment contracts – In contrast to indefinite-term contracts, fixed-term employment contracts have predetermined start and end dates. Per Montenegrin labor laws, fixed-term employment contracts can be effective for no longer than 36 months. These agreements should define the most important conditions of employment, including salaries, working hours, responsibilities and rights, termination policies, and other relevant terms.

 2. Contracts of work on temporary and occasional jobs

This type of contract is commonly used to employ a workforce for short-term and occasional work assignments that don’t require long-term employment commitment. Temporary and occasional work contracts’ duration in Montenegro is limited to a maximum of 120 days.

3. Service employment contracts

Service employment contracts regulate relationships between businesses or clients and freelancers or independent contractors. Under these agreements, individuals are providing services independently from any company while the employer pays the service fee. The employment contract should outline the scope of the service, remuneration, and other key terms of the agreement.

How to hire employees in Montenegro?

In Montenegro, the process of hiring new employees demands that employers establish a legitimate legal entity, acquire a tax identification number, and open a local bank account.

It’s equally important for companies to abide by Montenegro’s labor laws, including aspects such as minimum wage thresholds, work hours, employee benefits, and other legal prerequisites. 

For a more efficient approach to streamlining the complexities of legal procedures, businesses can partner with global recruitment companies like Native Teams. Through our EOR solutions, we’ll take on the responsibility of global payroll, tax submissions, HR paperwork, and other administrative tasks, freeing you to focus towards growing your business more.