Ukraine’s new Labor Code: Model for third world countries

Author : Aliona Potaieva

Source : 112 Ukraine

Draft Labor Code violates many articles of the Constitution and ignores most of International Labor Organization recommendations on the non-compliance of the document with international conventions
11:00, 31 March 2017

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The draft Labor Code, which has been finalized for almost two years by the second reading, is ready for submission to the session hall. And if the previous version of the document was full of norms that restricted the rights of employees, now the number of these norms became even larger. Some provisions of the bill contradict the Constitution and international commitments undertaken by Ukraine. However, this year the Labor Code can be adopted. It includes 12-hour working day, total shadowing, life under strict normative acts, created by the employer himself, and a lot of reasons for dismissals.

Laws are not an edict

In the first reading, the Labor Code was adopted on November 5, 2015. Neither 2160 amendments, nor the Memorandum on Technical Observations to the document from the International Labor Organization (ILO) helped improve the bill for the second reading. The Labor Code has turned into an unprecedented in its cynicism document, driving people into labor in bonded conditions and giving carte blanche to employers.

According to the expert on social policy issues Andriy Pavlovsky, the Labor Code prepared for the second reading violates many articles of the Constitution. And most of the 59 recommendations of the ILO on the non-compliance of the document with international conventions were not taken into account by the working group on the preparation of the code. "March 28-29, representatives of the ILO and global trade unions Jaap Wienen and Kemal Ozkan come to Ukraine to convince the authorities not to take the Labor Code until it is corrected," the expert explained.

Olena Mykhalchenko, a lawyer of Labor Initiatives NGO, notes that although the International Labor Organization is an influential body in the UN structure, Ukrainian state de facto ignores its recommendations to the draft Labor Code.

Related: Is Ukraine's new Labor Code anti-labor?

"If we are striving to achieve European standards in the social sphere that guarantee the stable development of the economy, it is necessary to take into account the position of the ILO in bringing the Ukrainian labor legislation in line with international norms," the lawyer stated.

She also recalls that ratified by Ukraine ILO conventions are part of our national legislation and are binding for implementation. But the developers of the Labor Code ignored a significant part of the conventions, as well as the requirements provided for in the Association Agreement of Ukraine with the EU.

Leading expert of The Centre for Labor and Social Studies (CLASS) Vitaly Dudin explaines that one of the EU directives obliges Ukraine to adopt some anti-discrimination norms that would specify both forms of discrimination and ways to protect the violated right.

"Before March 15, Labor Code contained signs of discrimination based on gender, age, diseases, and sexual orientation. However these guidelines were quickly removed. And they wrote plainly that discrimination on any grounds is prohibited instead. As Ukrainian practice shows, our courts can be interpreted in different ways and usually, not in favor of the employee," he stressed.

The interviewed experts outlined the most resonant norms of the draft Labor Code prepared for the second reading.

12-hour working day. Art. 138 of the code indicates that the working day could be extended to 12 hours, although in the first edition the peak demand was only 10 hours. However, the employer has no right to force an employee to work more than 40 hours a week.

Total control. According to Art. 29, employer, receives the right to supervise the performance of employees' duties by using technical means. And if earlier such measures were used due to the peculiarities of the enterprise, now it is enough to issue a regulatory act that allows to establish not only video surveillance, but also "bugs" to listen to staff’s talks, control the correspondence of employees in social networks.

Related: We should reduce labor migration from Ukraine, and we can do it

Fixed-term contracts. Part two of Art. 35 implies the possibility for the employer in any field to conclude an agreement with the employee for a certain period, for example, from a month to a year. In this case, the repeated re-signing of the contract does not translate into indefinite relations and does not guarantee the employee stable work. This was emphasized by the International Labor Organization in its recommendation 38 to the draft Labor Code. With the help of urgent contracts, it would be possible to constantly keep employees on the hook, threatening not to extend the contract.

Normative acts of the employer. The employer publishes normative acts even today, but their discretion is too limited. The Labor Code assumes that with the help of such documents the employer can settle almost any issue of labor relations at his discretion. Violation of the employer's regulations is a disciplinary offense. Put crudely, if the employer introduces a certain dress code, special language norms for communication or some other optional condition, the violator would be severely reprimanded (for the first time) and dismissed for the non-compliance.

Transfer of an employee from one employer to another. Art. 67 of the draft provides that the employee might be transferred to another workplace for 3 months. At the same time, the geography of the transfer is not legally limited (this might be another region or even a country), and social guarantees (for example, provision of temporary housing) are not fixed. According to Art. 82 of the bill, the transfer from one employer to another might be unlimited, but this would require the consent of the employee. However, if a person refuses to transfer, this might be a good reason to fire this person.

Related: Labor migration from Ukraine to Poland: From temporary to permanent

Layoffs. The draft Labor Code contains an excessive number of unclear reasons for dismissal on the initiative of the employer. Thus, paragraph 2 of part 2 of Art. 92 involves the dismissal of an employee in the event of disclosure of commercial information. Any information of an organizational (of technical or other nature might fall under this clause), for example, for disclosure of the size of the wages or internal labor regulations of the company. Insufficient qualification of the employee, which is confirmed by the results of not only attestation, but also by other evidence, could also become an excuse for dismissal. A failure to compulsory preventive vaccination or periodic medical examination (Part 3 of Article 93) is fraught with the termination of the employment contract without warning.

Work is the first concern. The employer would have right to individually include the obligation to work on public and religious holidays in an employment contract (Part 3, Article 312). And it would be much easier to attract people to overtime - the main thing is to extort the agreement. In this case, the decision of the trade unions would no longer be necessary.

Partial payment of salaries. The draft Labor Code introduces the dubious concept of "suspension of labor relations," according to which the employer has the right to pay wages partially. It can also be used if the employee, for example, participates in a strike (Article 70).

This is not a complete list of provisions that narrow the rights of hired workers. Lawmakers, on the pretext of the IMF's demands to increase the flexibility of the Ukrainian labor market, would try to push through the Labor Code, which puts trade unions to the sidelines, gives unlimited rights to employers, and leaves a truncated tool for employees to protect their rights.

Related: Ukrainian human rights organization uncovered forced labor prisons in occupied Donbas

"Until the end of April, the Labor Code is to be taken to the session hall"

Andriy Pavlovsky, expert on social policy issues:

"Changes in the labor legislation in the EU countries cause mass protests. Not the politicians take people on the streets, but by trade unions do. In Ukraine, independent trade unions are in an embryonic condition, and the old organizations which have remained from Soviet times, remain in a “lethargic dream,” being in full dependence on the power.

And the government is in a hurry. Until the end of April, the Labor Code is to be taken to the session hall. There are voices for the bill: we understand that the main customers of the Labor Code are "employers" from the Block of Petro Poroshenko, Popular Front, and the Opposition Bloc (former Party of Regions). However, the adoption of the document might increase social tension and even cause mass protests."

"An ideal option would be to modernize the current Labor Code"

Olena Mykhalchenko, a lawyer of Labor Initiatives NGO

"The Labor Code would work for big business and large capital, greatly narrowing the rights of hired workers. Therefore, public organizations and employers' associations are inclined to believe that the ideal option that would suit all participants in the process could be the modernization of the current Labor Code. To date, it maintains parity between the employee and the employer and enables the employee to protect his rights through collective negotiating and the union. The Labor Code is understandable for all participants in labor relations, including the courts. However, it needs some changes, like removing the obsolete standards, so that it corresponds to the realities. This can take from two to six months, but in this way, we get a law that would suit all interested parties."

Related: Exporting labor would save Ukraine

"The authorities have chosen a model designed for third world countries"

Vitaly Dudin, leading expert of the Center for Social and Labor Studies:

"Today many Ukrainians say that apparently Labor Code is the last barricade, which keeps investors from coming to Ukraine. Allegedly, foreigners do not want to work with such inflexible labor laws that prevent the dismissal of the guilty employee or conduct a massive reduction. According to the developers of the Labor Code, the elimination of existing deficiencies would allow investors to jump into Ukraine. But this is not that simple. According to research conducted by the IMF and the International Labor Organization, the flexibility of the labor market does not affect the revitalization of the economy, does not reduce the level of unemployment in the medium term, and does not increase labor productivity.

In Ukraine, the size of the single social contribution has been reduced, and further the state should have thought how to improve the availability of credit, administer the tax system and how to activate consumer demand. Instead, the authorities chose a model designed for third world countries: the less is the security, the greater the investment."

Related: Ukraine – top IT outsourcing country in Europe

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