St. Petersburg Raises Minimum Monthly Wage

Pepeliaev Group advises that the minimum monthly wage in St. Petersburg has been raised by a trilateral agreement.

By virtue of the agreement between the St. Petersburg Government, the Federation of Trade Unions of St. Petersburg and the Leningrad Region and the St. Petersburg Union of Industrialists and Entrepreneurs dated 22 April 2010 (the Agreement), the minimum monthly wage in St. Petersburg was raised to RUB 6,600 starting from 1 January 2010 and to RUB 6,890 starting from 1 September 2010. Employers with businesses in St. Petersburg have been offered to sign up to the Agreement. A corresponding message, together with the Agreement, was published in the newspaper St. Petersburg Vedomosti, Issue 74, dated 27 April 2010.

In accordance with article 133.1 of the Russian Labour Code, a constituent entity of Russia may establish a minimum monthly wage that exceeds the same set by federal law.

Employers with businesses in St. Petersburg may refuse to sign up to the Agreement. To this end, they need to submit a substantiated written refusal within 30 calendar days of the publication of the Agreement to the St. Petersburg Committee for Labour and Employment, accompanied by the minutes of consultative talks of the employer held with the elected body of the principal trade union and proposals on the date to raise the minimum monthly wage to the amount specified in the Agreement.

Companies operating in St. Petersburg should submit a written refusal by 27 May 2010 inclusive. If an employer fails to submit a written refusal by the established deadline, it will be held that the Agreement applies to such an employer. In this case the minimum monthly wage of an employee, who works standard working hours and complies with work quotas (fulfills job duties), may not be lower than RUB 6,600, and not lower than RUB 6,890 starting from 1 September 2010.

Please note that in pursuance with clause 2 of the Agreement the established minimum monthly wage does not include benefits and incentives. A similar position was expressed by the Russian Superior Court, which indicated that benefits, incentives and welfare payments might be established for employees only on top of the established minimum monthly wage (“Review of Legislation and Court Practice of the Superior Court of the Russian Federation for the Fourth Quarter of 2009” approved by the Resolution of the Presidium of the Russian Superior Court dated 10 March 2010).

For further details, please contact:

in Moscow – Julia Borozdna, Head of Employment and Migration Practice, Pepeliaev Group, at (495) 967-00-07 or by e-mail: j.borozdna@pgplaw.ru

in St. Petersburg – Andrey Pekhovsky, Head of Corporate Practice, Pepeliaev Group, at (812) 333-07-17 or by e-mail: a.pekhovsky@pgplaw.ru