Greater Liability for Salary Non-Payment. New Labour Dispute Resolution Rules

30.06.2016

Legal Update No. 561

State Duma reviews bill on greater liability for salary non-payment and new labour dispute jurisdiction rules

Goltsblat BLP advises that, at the third reading, the Russian State Duma has adopted a draft law amending some of the salary payment legislation, increasing employer liability for labour remuneration breaches and changing labour dispute resolution rules1 (the “Bill”).

The Bill was initiated by the Russian Government in January 2016 to encourage employers to pay their employees fully and on time.

The Bill (available in Russian only)>

 

KEY PROVISIONS OF THE BILL

Paydays

The Bill specifies paydays by requiring employers to pay salary within 15 calendar days of the end of the payroll period.

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Late salary interest to rise

The rules on employer financial liability for delaying payments to employees are changing. In particular, the interest rate payable to the employee for late remuneration has been raised.

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Greater liability for salary non-payment

The Bill sets apart late payment to employees of salary and other employment-related amounts from the other employment law violations and adds it to the Russian Code of Administrative Offences as an independent offence.

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Longer statute of limitations for salary payment claims

The Bill will also extend the statute of limitations for salary non-payment disputes to one year.

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New jurisdiction rules

In addition to the longer statute of limitations, the Bill also modifies the rules on jurisdiction over disputes associated with reinstatement and protection of labour rights. Employees will be able to file lawsuits where they live.

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WHAT NEXT?

The Bill comes into force 90 days after its official publication.

Goltsblat BLP will continue monitoring the status of the Bill as it passes through the final enactment phases and will keep you informed of any major developments.

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1 No. 983383-6 “On Amending Certain Legislative Acts of the Russian Federation to Increase Employer Liability for Breaching Legislation on Remuneration of Labour”.

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