written by Recalculating an employee’s length of service after periods of unpaid leave is a common source of confusion for HR departments. The short answer is that unpaid leave is generally not included in length of service, which means that the relevant period must be deducted from the total. The way this recalculation is performed depends on the type of employment contract, the duration of the absence, and the purpose for which length of service is being calculated.
What is unpaid leave and when is it granted?
Unpaid leave is a period during which an individual employment contract is suspended at the employee’s request, with the employer’s agreement. During the suspension, the employee does not perform work and does not receive a salary.
The Romanian Labour Code allows unpaid leave to be granted for personal reasons, education, or other justified circumstances. There is no statutory limit on its duration, but the period must be mutually agreed upon and documented through an addendum to the employment contract.
How is unpaid leave treated when calculating length of service?
As a general rule, periods of unpaid leave do not count towards length of service. During the suspension, the employment contract does not produce its usual effects: the employee does not work and no social security contributions are paid.
| Type of service | Is unpaid leave included? | Notes |
|---|---|---|
| General length of service | No | The period is deducted from the total |
| Length of service in the relevant field | No | The same treatment applies |
| Pension contribution period | No | No contributions are paid |
| Service for annual leave entitlement | Depends on internal regulations | Some companies may include shorter periods |
One important nuance is that unpaid leave of up to 30 days per calendar year may be taken into account when calculating certain internal benefits, such as seniority bonuses established under internal regulations or collective bargaining agreements. However, this exception does not turn the period into a contribution period—the general rule that unpaid leave is excluded remains applicable.
Therefore, if an employee has worked for 5 years and has taken 6 months of unpaid leave, their effective length of service is 4 years and 6 months—not 5 years.
Recalculating length of service: practical steps
1. Identify the suspension periods: Review the employee’s personnel file and identify all addenda granting unpaid leave, including the exact start and end dates.
2. Calculate the total duration of the suspensions: Add up all periods of unpaid leave, expressed in calendar days or months.
3. Deduct the suspension periods: Subtract the total suspension period from the overall duration of the employment relationship.
4. Check for other periods that do not count towards length of service: Determine whether there are any other periods of unauthorised absence or suspensions that should be treated similarly.
5. Document the result: Record the recalculated length of service in the relevant personnel records and use it when calculating the employee’s associated entitlements.
One common mistake is for HR teams to calculate length of service based solely on the employee’s hire date, without checking the suspension periods recorded in the personnel file. Digital personnel document management significantly reduces this risk by centralising all contract addenda and suspension decisions and making them immediately accessible.
Impact on employee entitlements
Accurately recalculating length of service can directly affect several employee entitlements:
- Annual leave – the number of days may depend on actual length of service, in accordance with the applicable collective agreement or internal regulations;
- Seniority bonuses – where applicable, these are calculated based on actual length of service;
- Notice periods and compensation – certain calculations may take actual length of service into account when the employment contract ends;
- Retirement – the pension contribution period does not include periods of unpaid leave, which may affect the date on which the employee meets the requirements for retirement.
Accurate recording of absences, including periods of unpaid leave, is the starting point for any recalculation. A time and attendance management solution integrated with personnel administration enables these periods to be tracked in real time, eliminating the need for subsequent manual reconciliation.
Documents required for an accurate recalculation
Each employee’s personnel file should contain:
- The individual employment contract and all related addenda;
- Decisions granting unpaid leave;
- Employee requests and employer approvals;
- Records of suspension periods, including the exact dates.
When all documents are centralised and readily accessible, the recalculation can be verified quickly, without relying on physical archives or the memory of a single HR specialist.
Frequently asked questions
Are there situations where unpaid leave is still included in length of service?
Romanian legislation does not provide for a general exception. However, other types of employment suspension are treated differently:
- Parental leave is included in length of service and constitutes an assimilated contribution period, in accordance with Government Emergency Ordinance No. 111/2010 (Article 22) and Law No. 360/2023 (Article 14(1)(e));
- Sick leave is considered a contribution period; even the first unpaid day of sick leave, applicable as of 1 February 2026, is treated as an insurance period and does not affect length of service.
These situations are distinct from unpaid leave taken for personal reasons and should not be confused when calculating employee entitlements.
Can an employee challenge the recalculation if they were not informed when the unpaid leave was granted?
Yes. The Labour Code does not expressly require employers to inform employees about the impact of a suspension on length of service. However, good HR practice recommends that the relevant addenda explicitly state these consequences. If the employee was not given any explanation, they may raise objections, and the employer may need to demonstrate that the documents were signed with an understanding of their implications.
If suspension periods are managed manually, the risk of errors increases in proportion to the number of employees and the length of employment relationships. A digital personnel management solution centralises contracts, addenda, and suspension periods, making them accessible whenever an accurate recalculation is required.
Contact the Smartree team to find out how personnel records can be managed more efficiently in your organisation.
