The latest set of amendments to the Russian Code on Administrative Offences (the “Code”) came into force on 1 January 2015. These new rules create a greater level of liability for non-compliance with labour laws and labour safety requirements through an extension of the limitation period for bringing a claim against the offending employer, the creation of new ‘special offences’, and an increase in the maximum level of fines for each category of violations.
The limitation period within which an administrative claim can be brought against an employer for failure to comply with labour laws has been extended to one year (from the previous limit of two months). The period starts on the day the employer commits the offence or, where the offence is continuing, on the day a regulatory authority reveals the offence.
If the employer takes steps to eliminate a continuing offence, then the limitation period will start from the date on which the offence is finally eliminated. In other words, if an employer detects and subsequently eliminates a continuing offence, the employer may still be charged with administrative liability twelve months after the offence has ceased to exist.
As the amended Code distinguishes between labour law and labour safety offences, from 1 January 2015 onwards, liability for these types of offences will be governed by different articles of the Code. Labour law violations are contained in Article 5.27 of the Code, and labour safety violations are contained in Article 5.27.1 of the Code.
The amended Code has also introduced through the above-mentioned articles a set of ‘special offences’ for both categories of violations, which only apply in limited cases. These contrast with the ‘general offences’, which apply by default if no other laws specific to that particular situation (i.e. no ‘special offences’) have been enacted.
Within the labour laws category, special offences include cases when:
- an individual is actually admitted to work by a person not authorised by the employer to do so, provided that the employer or its authorised representative has failed to enter into an employment agreement with that individual;
- the employer avoids to or improperly enter into an employment agreement, or concludes a civil law contract which in fact governs the employment relations between the employee and the employer.
Within the labour safety laws category, special offences include:
- breach by the employer of the established procedure for the conduct of a special assessment of the working conditions, or failure by the employer to conduct this type of special assessment;
- admission of an employee to work, if the employee failed to pass the following: proper training and safety knowledge assessments, mandatory preliminary (upon employment) and periodical (during the term of employment) medical examinations, mandatory medical examinations at the beginning of the employee’s working day or shift, and/or mandatory psychiatric examinations. The offence will also be committed by an employer admitting an employee who has medical contraindications to work;
- failure to provide the employees with personal safety equipment.
The commission of a special offence will result in heavier penalties for both the officers and entities responsible.
With regard to minor offences committed by officers, a new administrative penalty in the form of a warning has been introduced.
Furthermore, under the amended Code, the maximum administrative fine that may be imposed on an officer for non-compliance with labour law requirements has been increased to RUB 20,000 (approx. EUR 265). In the event of a recurring offence, as a general rule, the officer may be either fined or disqualified for a term of up to three years. However, if the recurring offence is one of the labour law special offences listed above, then the only penalty that a court can be imposed on an officer will be disqualification for a term of up to three years. It is therefore particularly important that any officer who has already been held liable for breach of labour laws in the past pay particular attention to not doing so again.
Legal entities’ liability
The maximum administrative fines that can be imposed on legal entities can be summarised as follows:
Area of law violated
Type of offence
Maximum fine for first time offence
Maximum fine for recurring offences
RUB 50,000 (approx. EUR 660) – unchanged from the previously applicable maximum amount
RUB 100,000 (approx. EUR 1,330)
RUB 70,000 (approx. EUR 930)
RUB 200,000 (approx. EUR 2,655)
Labour safety offences
Increased to RUB 80,000 (approx. EUR 1,060)
RUB 80,000 – 150,000 (approx. EUR 1,060 – 1,990)
RUB 200,000 (approx. EUR 2,655) and/or administrative suspension of activities
In our opinion, the stiffened liability for labour law and labour safety offences will result in tougher control of the state authorities over compliance by the employers with labour and labour safety laws.
Notably, in accordance with the current law-enforcement and court practice, both the officer and the entity may be held liable for the offence. Moreover, if the same offence is simultaneously committed against a number of employees (e.g. if the employees have been admitted to work without passing a safety training and knowledge assessment), the total amount of administrative fine imposed on the officer or the entity for such offences may be calculated taking into account the total number of employees affected by the relevant offence.
In order to minimise the risk of administrative liability, we recommend that employers check whether they comply with the labour law and labour safety requirements and eliminate violations, if any, as soon as practicable.