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. Last Updated: 07/27/2016

Foreign Workers Face New Red Tape

The City Duma on Wednesday approved legislation regulating the employment of foreigners in Moscow, requiring all businesses to apply for permission to employ foreign citizens before doing so.

The legislation, which was sent to Moscow Mayor Yury Luzhkov to be signed into law, differs little from decrees signed by Luzhkov in 1996 and President Boris Yeltsin in 1993, legal experts said.

But the passage of the legislation Wednesday served as a reminder of the city's power to control who works in Moscow. The only significant new provision is that organizations or individuals who allow unregistered foreigners to use nonresidential premises or construction sites can be subject to fines of up to 100 minimum wages (30,000 rubles, or $1,000) for organizations and 20 minimum wages (6,000 rubles, or $200) for individuals. The legislation requires Moscow-based companies and individuals, both Russian and foreign, who hire foreigners to receive permission from the Moscow branch of the Nationalities and Migration Ministry. The foreigner then receives a document from the ministry confirming his legal employment.

"There is no difference for us whether a foreigner gets a staff contract or is a consultant, whether he will be employed for years or just for one day," Sergei Mark, an adviser in the ministry's Moscow branch, said in a telephone interview Thursday. "Employers are to get our permission first, and only then can they hire foreigners." The usual problem, he said, is that employers do it the other way around.

There are, however, a few categories of foreigners who can be employed without permission: those who have a Russian residency permit or permanent registration with police -- called a propisk; church employees; technical experts who come for a short period to assemble imported equipment; and those who come for educational activities.

There is a legal loophole, but an expensive one, for avoiding the bureaucratic routine.

"The branch office of a foreign company in Moscow can invite up to five foreign representatives who do not need to be registered with us," a ministry official said on condition of anonymity. This option costs the employer about $2,500 per representative per year.

Another tactic used by some companies -- employing foreigners in Moscow through offshore subsidiaries -- is illegal, Mark said. "If we check such a company and see a foreigner at his working place and he is not registered with the company's personnel department, it is proof of a crime," he said. Employers are subject to fines of up to 30,000 rubles for each illegally employed foreigner.

The Moscow branch of the Nationalities and Migration Ministry has a special force for checking up on companies together with city police and prosecutors, Mark said. But companies hiring professional workers are seldom checked, he said. The vast majority of abuses involve the employment of unskilled personnel, especially in the construction business.

The new law would defend workers from arbitrary treatment by employers and bring employment practices out of the shadows to the benefit of the city budget, the author of the bill, City Duma Deputy Mikhail Vyshegorodtsev, was quoted by media as saying.

About 100,000 foreign employees were registered in Moscow as of the beginning of the year. More than 300,000 work in the city illegally, he said.