Attention Employers: Professional Standards Are Coming to Russia
More than 500 new professional standards (“profstandards") have already been adopted by the Russian Ministry of Labour, and 300 more profstandards are expected by the end of 2016. Employers must apply these new standards from 1 July 2016 onwards. Failing to comply with them can end with a warning or even fines for the company and its general manager.
What is a Profstandard?
A profstandard is a legally-required standard aimed at improving the quality of labour resources, employees’ professional growth, and compliance with international qualification standards (link in Russian). Applying to certain types of work, profstandards include:
- a strictly defined job title;
- detailed description of job functions; and
- requirements for essential knowledge, education and skills.
Industries such as metallurgical engineering, timber, chemicals and the hotel business are already required to use their new profstandards.
Examples of some new profstandards for the hotel business include Manager of Hotel Complex/Chain, Head of Food and Beverage Outlet and Confectioner.
The profstandards adopted by the Ministry must be applied whenever any of the following laws specifically requires that a particular standard be applied:
- Russian Labour Code (e.g. employees engaged to underground work);
- Federal laws (e.g. Federal law ‘On Education’, Federal law ‘On Health Care’, Air Code, Commercial Maritime Code, etc.); and
- other regulatory legal acts (resolutions and orders of Russian Government, orders of the federal executive bodies such as the Ministry of Transport of Russia, etc.).
Who Must Apply Profstandards?
Russian law clearly requires the following types of companies to apply profstandards:
- state-owned companies;
- companies with more than 50% state participation;
- employers who are legally required to apply profstandards, such as the accountant’s profstandard in Russian public joint stock companies; and
- any employers, including commercial entities without any state participation, if directly required by the laws to apply profstandards or when the performance of certain work is connected to compulsory benefits, compensation or restrictions.
At present, commercial entities do not have to apply profstandards to all their employees without exception. In cases when an employer is not required to apply profstandards, the employer may use the profstandards adopted by the Ministry of Labour as a reference point. This could include things like identifying job titles, job functions, requirements for education and work experience, developing personnel management, organising trainings and certifications for employees and development of job descriptions.
How to Apply Profstandards?
If, as an employer, you are required to apply profstandards by the direct requirements of applicable law, you should prepare a procedure that includes, among other things, formal evaluation of your employees and especially adjust their job descriptions and job titles in line with the profstandards, and also revise your remuneration system. It is also important to bring your local acts in line with profstandards.
You are not entitled to dismiss an employee simply because his or her qualifications and profstandard mismatch. Instead, you can either provide your employee with the opportunity to receive supplementary education or you can perform a formal assessment of your employee, which strictly complies with the procedure required by labour law. The Russian Labour Code does permit you to dismiss an employee in case of an unsatisfactory result of such a formal assessment.
Consequences if You Don’t Apply Profstandards?
If your business fails to comply with mandatory profstandards, your business may receive a warning the first time. However, if your business fails to comply with mandatory profstandards again, your business could face administrative fines and other penalties for each violation as follows:
- up to RUB 5,000 (approx. EUR 70) fine to your general director;
- up to RUB 50,000 (approx. EUR 700) fine to your company; and
- up to RUB 70,000 (approx. EUR 1,100) in fines and disqualification of the general director for up to 3 years if your company repeatedly fails to comply with mandatory profstandards.
Protecting your business is a good investment and we recommend that you find out whether your company already needs to comply with new mandatory profstandards or whether you may need to be ready to start using profstandards in the near future.