Key Points of Law 27 of 2026 on Employment Protection

Law 27 of 2026 on Employment Protection was enacted and promulgated on 28 October 2026, and took effect that day under Article 313. Article 311 repeals Law 13 of 2003 and certain employment parts of Law 6 of 2023.

Earlier implementing regulations stay in place so far as they do not conflict, under Article 310. New regulations must be issued within one year, by 28 October 2027.

Fixed-term contracts

Article 82(2) limits a fixed-term contract to 2 years, extendable only twice, each by up to 1 year. The total is at most 4 years. An intention to extend must be notified in writing at least 7 days before the contract ends.

Article 87(3) requires fixed-term contracts to be recorded within 3 working days of signing. Article 86 bars probation in fixed-term contracts, and Article 88 requires compensation when the contract ends.

A fixed-term contract that is not in writing, or is used for permanent work, becomes an open-ended contract by law, under Articles 85 and 87(5).

Overtime and wage structures

Article 116 limits overtime to 4 hours a day and 18 hours a week, with a written or digital order and the worker’s consent. The first hour is paid at 1.5 times, later hours at 2 times, with the hourly wage being base pay and fixed allowances divided by 173.

Article 146 requires a wage structure and scale, and paragraph (3) requires it to be attached to the company regulations or collective labour agreement. Breach brings administrative sanctions under Article 147.

Outsourcing

Article 95(3) lists four supporting services: cleaning, meals for workers, security, and worker transport. Article 96 adds supporting services in mining and oil, which must go through a subsidiary in the form of a limited liability company.

Outsourced workers used for activities directly related to production become, by law, workers of the company using them, under Article 98. Article 306 allows 1 year from promulgation to adjust, and existing agreements stay in place until they end.

Severance and the reserve

Article 232 sets severance at up to 9 months’ wages for 8 years of service or more, plus long-service pay. Chapter XVI brings a new duty: Article 253 requires employers to provide a severance reserve managed by a government institution, except micro and small businesses.

Sanctions rise in stages up to revocation of the business licence. The contribution and procedure await a Government Regulation.

What to do first

HR should match current fixed-term contracts against Article 82 and prepare for recording within 3 working days. Finance should ask the actuary to reassess employee benefit assumptions for the 2026 year-end statements, and include a possible reserve contribution in the 2027 budget.

The effect on labour supply contracts is covered in Six Outsourcing Fields Under Manpower Regulation 7 of 2026.