The Act on the suppression of undeclared work: what it means for employers

Why undeclared work is a target

Undeclared work is prohibited by law, and the state is stepping up checks, especially in the field. Alongside existing regulations, a new Act on the suppression of undeclared work has been announced, together with an electronic working-hours records project aimed at sectors where work is hard to track.

The financial consequence

If an inspection finds an undeclared worker, the employer can be ordered by decision to register them for mandatory pension insurance from the day established as the start of work, and to pay 2,650 euros for each undeclared worker into the state budget. On top of that, stricter penalties for "persistent", repeat offenders have been announced.

Where checks are heaviest

The focus is on activities with changing and field-based workplaces, above all construction and platform work. It is precisely there that a worker's clock-in at the entrance, with time and location, is the most effective proof that work is declared and recorded.

How to protect yourself

Protection is not just the formal registration, but orderly records created at the source. When every worker clocks in at the entrance, with exact time and location (geofence and GPS record), and the record is tamper-proof, it is easy to show who worked, when and where. This also applies to subcontractors on the same construction site.

Read more about the state's direction in The government introduces electronic working-hours records, and about the field setup in Records on the construction site and in the field.

Note: this text is informational and does not constitute legal advice. Source: the Act on the suppression of undeclared work (zakon.hr).