The jobs of thousands of employees in companies that wentinsolvent are threatened, considering that shareholders along withthe court-appointed administrators have the legal right ofterminating all employment contracts without going through thecollective layoff steps.
"Legally, the insolvent companies are not prohibited from resortingto redundancies. On the contrary, the legislation stipulates thisprocess can be sped up as an emergency, without complying with thedeadlines set in the Labour Code for collective layoffs," saysSerban Paslaru, partner of Tuca, Zbarcea & Asociatii.
Moreover, the law does not clearly set a limit to the number ofemployees that can be laid off by insolvent companies.
The biggest 14 companies to have filed for insolvency over the lastfew months have lost several thousand employees since the end oflast year, as part of the streamlining processes conducted beforethe start of the insolvency proceedings. Therefore, whereas 14companies totalled 12,000 employees at the end of 2008, they arecurrently employing no more than 7,100 people, according to thedata centralised by ZF. The number of employees working ininsolvent companies is much higher, in the range of tens ofthousands.
The Pic group, last year's biggest Romanian-held company in foodretail made approximately 500 employees redundant after filing forinsolvency a few weeks ago.
Before resorting to this, brothers Ilie and Cornel Penescureorganised their business and slashed 1,200 jobs. The retailer isnow struggling to survive on a dwindling market with only twohypermarkets still in business, compared with five at the end of2008.
"Last year we had 3,000 employees and now only 1,300 are left inthe entire group, 600 of which working in hypermarkets. We wouldsell everything that can be sold to get cash, but under the currentcircumstances on the market we cannot find any buyers," IliePenescu stated.
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