By decision of the Council of Ministers, following a proposal by the Ministry of Labour, the Government asks the Parliament to put a ceiling on the increase in the administrative fine that will be imposed for undeclared work.
Specifically, according to a bill submitted by the Ministry of Labour to the Parliament, in case of late (late) payment of the fine by employers or self-employed employees who engaged in illegal (undeclared) employment, the increase in the fine will not be able to be more than double the amount of the fine imposed, as provided for today by the legislation passed by the Parliament. This in practice means that the total fine will not exceed the amount of the imposed administrative fine or twice the amount, provided that the majority of the Parliament agrees.
Today, under the Social Insurance Act, those who violate the law on undeclared work and do not pay the fine on time, then it rises by €50 per day, for each day of delay. This practice resulted in a large number of employers and self-employed persons who did not pay the fine within the deadline to accumulate debts to the Social Insurance Fund. Others, however, in order to avoid the additional burden, paid on time.
Increase in debts by 252%
In addition to the accumulation of debts, which amount to €65.6 million, dozens of debtors were brought to justice. The Social Insurance Services have registered civil lawsuits before the District Courts, for the issuance of court decisions or decrees against natural and legal persons for debts for undeclared – illegal work.
According to data from the Social Insurance Services, from June 2017 until the end of March 2026, the competent authorities imposed administrative fines amounting to €2.5 million to 827 persons. These are 722 employers, who were imposed initial financial penalties of €2.4 million. and for 105 self-employed workers, who had to pay fines of €74,000.
In fact, due to the punitive €50 (additional fee when the fine is not paid on time or is not paid at all) per day, debts to the state skyrocketed to a total of €65.6 million. Specifically, the debts with the imposition of the additional fee for employers amount to €56.7 million. and for the self-employed it is €8.8 million. Essentially, with the punitive €50 per day, the amount of the debt increased by 252%, i.e. it was 26.2 times greater than the original fine, because it was not paid on time to the state.
It is worth noting that of the total amount of fines of €65.6 million. by the end of March, an amount of only €6.1 million ended up in the state coffers. However, with the application of the formula proposed by the Ministry of Labour and accepted by the Council of Ministers, i.e. with the imposition of a ceiling on financial sanctions, the total amount of debts from €65.5 million. will be reduced to €7.9 million, if the Parliament accepts that the new proposal of the Cabinet has retroactive effect.
That is, the amount of fines for the 722 employers will be €7.6 million. from €2.4 mil. which was the initial debt and for the 105 self-employed the penalties will be €224,000, while the initial amount of the penalties was €74,000. The above calculations include the totals of debts to the Social Insurance Fund, which include the initial fine with the increases, but also the amount paid to date.
Thanks to debtors
With the implementation of the legislative regulation proposed by the Government, if accepted by the Parliament, the administrative fine for undeclared work will not be considered - by the violators of the law - excessive and destructive for the employer or the self-employed. The Ministry of Finance also consented to the legislative regulation, although it will have an impact on public finances, due to the reduction of revenues in the Social Insurance Fund.
