Joining the federal aviation industry agreement for 2014 -2016

On 6 June 2014, Rossiyskaya Gazeta published a Letter of the Russian Ministry of Labour and Social Protection (the 'Ministry') in relation to joining the Russian Aviation Industry Agreement for 2014-2016 (the 'Agreement').

The Agreement has effect in relation to:

• companies that are members of the All-Russian Industrial Association of Employers 'Russian Union of Machine Builders' (the 'Association').
• companies which are not members of the Association but have authorised the Association to enter into the Agreement on their behalf,
• other companies in the Russian aviation industry, unless such companies submit to the Ministry a well-grounded refusal to join the Agreement by 5 July 2014.

Below we set out some of the provisions of the Agreement which lay down additional requirements for employers.

• The rules of corporate labour regulations, the shift schedule, regulations on bonuses and some other local regulations are to be adopted after they have been approved by the elected body of the primary trade union organisation (clause 48);
• Heads and deputy heads of a number of trade union bodies may be dismissed on the grounds of staff reduction or job elimination only if agreed with the trade union (clause 49);
• Salaries are to be indexed by increasing the basic rates and basic salary at least once a calendar year for all categories of employees simultaneously by an amount not lower than the consumer price index for goods and services in the relevant constituent entity of the Russian Federation (clause 65);
• Additional payments to employees for working in the evening are to be 20% of their hourly basic rate (basic salary) and 40 % of their hourly basic rate (basic salary) for working at night (for each hour of work) (clause 66).

Implications for companies

For companies which were not involved in the Agreement being concluded (i.e. are not members of the Association of Employers and did not authorise them to enter into the Agreement), the only option for refusing to join is to file a well-grounded refusal with the Ministry, accompanied by the minutes of the discussions with the elected body of the primary trade union organisation which represents the company's employees (article 48(8) of the Russian Labour Code).

We recommend considering whether it is prudent to join the Agreement, and, if the decision is taken to refuse to join, filing a well-grounded refusal with the Ministry of Labour and Social Protection. It is also necessary for the Ministry to receive a well-grounded refusal within 30 calendar days from the date when it was published, that is, by 5 July 2014 (inclusive).

If such well-grounded refusal is not filed or is filed in breach of the deadline, the employees of the relevant company will have the right to claim (including though the court) that guarantees, compensations and benefits be granted to them in accordance with the Agreement. State Labour Inspectorate bodies will have grounds to hold the company administratively liable for not complying with the Agreement.

Help from your adviser

Pepeliaev Group's experts will readily provide the necessary legal support when the documents are prepared which are required to refuse to join the Agreement, and on any other issues which relate to the Agreement being in effect.

Contact details

Julia Borozdna, Head of Labour and Employment Law, Pepeliaev Group (Moscow), tel.: +7 495 967 00 07

Alexander Korkin, Senior Associate (St Petersburg), tel.: +7 812 640 60 10