New Moscow trilateral agreement for 2013-2015 enters into force

18.01.2013

Legal Update No. 403, 18 January 2013

Goltsblat BLP hereby advises of official publication of the Moscow trilateral agreement for 2013-2015 (hereinafter the “Agreement”), which replaces the previous 2012 agreement from 1 January 2013.

It should be emphasised that the Agreement does not provide for any critical changes in the social partnership conditions established by the preceding 2012 agreement, yet it does contain several conceptually new requirements on Moscow employers.  This legal update is dedicated to the most important changes introduced by the new Agreement.

1. For the first time, the Agreement is concluded for a period of 3 years, whereas previously it was for 1 year only.

2. The Agreement establishes that employers engaging foreign workers should make a voluntary annual contribution to the city budget of RUB 1000 per job held by a foreign employee.  The preceding agreement did not make such a requirement.

3. The obligation of employers to train foreigners employed in Moscow and obtain relevant documents on such education is also maintained in the Agreement.  This obligation corresponds, in general, to the recent changes in the procedure for engaging foreign citizens to work in retail, public facilities, and municipal service - in relation to mandatory confirmation of their knowledge of the Russian language at least at an elementary level (amendment introduced into article 7.6 of the Federal Law “On the Legal Status of Foreign Employees in the Russian Federation” on 12 November 2012).

4. The possibility of reducing the amount of additional compensation in the event of a workplace accident depending on the extent of the employee’s guilt by a maximum of 25% is established in the Agreement. The initial amount of such compensation has not changed from 50 Moscow minimum wages.

5. The Agreement also retains the limitation on granting approval to engage and employ foreign citizens in the following events:  release of employees resulting from downsizing, avoidance of or failure to perform the provisions of the Agreement; setting of requirements on prospective employees that do not relate to qualifications and performance of job duties.

6. The current 3.2 per cent marginal rate for foreign employees remains unchanged.

7. One of the most significant changes is cancellation of the previous rule regarding a higher compensation rate for delayed salary payment (1/200 of the Bank of Russia refinancing rate); such compensation should now be calculated at 1/300 of the refinancing rate, in accordance with article 236 of the Labour Code.

8. The Agreement prohibits dismissal owing to staff reduction or job elimination of employees belonging to the same family members within one year.  This is a new requirement of the Agreement.

9. The Agreement does not change the mass lay-off criteria that were established by the previous document, in particular:

  • dismissal within 30 calendar days of more than 25% of the entity's total workforce;
  • dismissal of employees owing to liquidation of the entity, irrespective of its legal form;
  • staff reduction or job elimination with respect to the entity’s employees:
    • 50 employees or more — within 30 calendar days;
    • 200 employees or more — within 60 calendar days;
    • 500 employees or more — within 90 calendar days.

10. The Agreement is supplemented with a provision requiring employees dismissed owing to staff reduction or job elimination to be provided with re-training options and time for job seeking before termination of their employment contracts. Previously this requirement used to be only recommended for inclusion in collective bargaining agreements.

Moreover, in accordance with the new agreement on the minimum wage in Moscow for 2013, the minimum wage remains the same at 11 700 Roubles but it is expected to be increased to 12 200 Roubles after 1 July 2013.

If you have any question or would like more detailed information, please contact: Nadezhda Ilyushina, Head of Employment, Pension & Benefits Practice, Goltsblat BLP: +7 495 287 44 44, Nadezhda.Ilyushina@gblplaw.com.

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