The Legal Standing of Foreign Workers in Russia

The dynamic development of investment projects in Russia often involves the need to recruit foreign workers -- top managers as a rule. Presently, in view of the ongoing economic situation, which calls for suspension or halt of foreign projects in Russia, companies are faced with the need to optimize expenditures, including at the cost of expenditures on staff.

In this situation, the termination of labor relations with foreign workers is often done in violation of their labor rights. A foreign worker may, for example, have a contract with a parent company located outside Russia (call it the "Base Contract") and is then transferred to a representative office or a subsidiary or affiliated company in Russia, while the Base Contract remains in force.

The worker therefore retains his previous place of work (outside Russia) and gains a new one (in Russia). When a decision is adopted on dismissing the worker from the parent company, they are simultaneously dismissed from the company in Russia, but based on the terms of, and in accordance with the Base Contract, which is a big mistake, since Russian labor legislation has stringent regulations protecting workers and requires the employer to comply with set dismissal rules and procedures.

In view of this and for the avoidance of possible problems and violations, the employer needs to have a clear understanding of the foreign worker's legal standing in Russia.

Foreign workers also need to know, first of all, that while employed on Russian territory they enjoy the same rights as Russian citizens, including various guarantees pertaining to employment and termination of it -- regardless of what country the employer company is located in. Therefore, in spite of the Base Contract, the labor relations with the foreign worker on Russian territory are subject to Russian labor legislation.

Labor relations with foreign workers are to be documented in a labor contract and a relevant order on being hired. The employer also needs to start a work history record (a 'work book') for the worker. If labor relations have not been documented in a written contract, one should not be dismayed, since a labor contract is likewise deemed concluded if the employer has factually allowed the worker to perform work, or in other words has defined his work duties and work place.

Foreign workers are also mistaken in presuming that absence of a Russian work permit automatically makes the labor contract void. That is not so, but is rather a violation of the Russian migration legislation, which in no way restricts the foreign worker's labor rights.

Dismissal of a foreign worker must likewise be done in compliance with Russian labor legislation and is only allowed based on certain grounds. Such grounds do not include dismissal of a worker at the employer's free will.

However, in practice employers often violate the established rules and it is important to distinguish legal dismissal from a factual dismissal. Legal dismissal is documented with an order on dismissal, accompanied by the worker's work history record being returned to them, as well as other formalities.

When a factual dismissal takes place, these documents are not processed, but the worker is deprived of the factual opportunity to continue working. For example, work equipment, computer, telephones, work auto or work pass may be taken from the worker. Such factual dismissal of a worker is unlawful in all cases without exception. Legal dismissal may be either lawful or unlawful, depending on the grounds in each relevant case, procedure compliance and rights of the worker at dismissal.

There has recently been a wave of layoffs in companies and in this connection we should stress some of the basic rights of workers during a layoff:

•First of all, the employer must take into account preferential rights of certain workers, such as those with two or more dependants or who are the only breadwinner in the family.

•Second, the worker should be offered any vacant positions in the company both appropriate to their qualification or lower.

•Third, a worker needs to be given no less than two months' notice about the layoff and such notice must be given to the worker in writing and is to be signed by the worker.

•Fourth, the employer must issue an order on the dismissal, which must likewise be shown to the worker in writing and is to be signed by the worker.

•Fifth, the worker must be given severance pay in the amount of their average monthly earnings, but not exceeding two months from the dismissal date, and also payment for unused vacation time.

If a worker is dismissed without legal grounds, or factually dismissed, or if the above rights during a layoff are violated, the worker may file a claim with the court on the dismissal being unlawful and request reinstatement, payment of average earning for the period of forced absence and compensation for emotional damages.

Foreign workers, same as all others, should note that under the law a worker can file a claim pertaining to labor disputes with the court within one month following the date they were given a copy of the dismissal order or when they were given their work history record. If no such documents were received from the employer, we recommend filing the claim with the court within one month from the date the work factually ceased (the factual dismissal).

In conclusion, we should note the statistics for 2008 showing a favorable trend in court decisions pertaining to work reinstatement, where in the majority of cases the courts sided with the workers. Namely, approximately 60 percent of those who were dismissed but filed a claim were reinstated – a good trend indeed. So if the employer violates a foreign worker's rights, our advice is to not leave this be and to seek protection of rights through court.