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2020 Vision: what can employers in Russia expect this year?

Written by
ALRUD, a confident Russian leader in labour and employment law.
New developments in Russian employment law in 2020 will include changes to the rules on severance payments, a new tax regime for the self-employed and the introduction of digital HR records.

Migration law news

Visa-free entrance to the 2020 UEFA European Football Championship for Fan ID owners

As a result of the 2020 UEFA European Football Championship being held in Russia in summer 2020, foreign nationals who have Fan ID will be permitted to enter Russia without a visa from 30 May 2020 to 3 July 2020.

These foreign nationals are not required to obtain a visa in order to visit Russia for tourist purposes during this period established by law.

New regulations regarding residence permits.

Starting from 1 November 2019, certain categories of individuals may obtain a Russian permanent residence permit for an indefinite period. Previously, a permanent residence permit was only issued for five years, with an option to extend.

The list of individuals who can obtain a Russian permanent residence permit according to a simplified procedure has also been expanded.

New rules regarding severance payments

It is expected that in 2020, new rules will come into force in Russia for providing severance payments to employees who are dismissed as a result of the liquidation of a company. The new regulation is aimed at giving additional protection for this category of employees and will provide two payment structure options: either a lump-sum payment on the date of dismissal or payment by installments within two months of the dismissal date. The amount of severance payment prescribed by the law remains the same.

Introduction of a tax for self-employed individuals

In 2019, the pilot-project on the taxation of ‘self-employed’ individuals (individuals, who do not have an employer and do not hire other individuals under labour contracts) commenced in Moscow, Moscow Region, Kaluga Region, and Tatarstan.

The Federal Tax Service has already warned employers against re-hiring individuals as self-employed contractors, in order to optimise taxes and social contributions. If the Federal Tax Service dicovers that an employer has  unlawfully re-hired individuals as self-employed contractors, the company may face additional taxes or fees and may be held administratively liable.

New litigation rules

In 2019, amendments to procedural legislation came into effect, which directly affect the procedure for handling labour disputes. In accordance with the new rules, only lawyers and other individuals with higher legal education, or a degree in law, can be representatives in court.

The changes establish new cassation revision rules. The amendment will implement a shortened limitation period of three months instead of six, as well as establishing that all claims will be directly considered by the court presidium. Earlier, only selected cassation claims could reach the presidium because of differing case management procedures .

Digitalisation of HR

In 2020 it is planned to replace paper labour books (statutory HR documents recording employees’ years of service) with electronic versions. Employees who would like to keep a paper labour book may apply to their employer to request this during 2020. For all new hires who will get a job for the first time in 2021, information about their work periods will be kept only in electronic form.

New minimum salary

In 2020 it is expected that the minimum salary will be increased. The planned increase is 7.5%. Employers cannot pay employees a basic salary below this legal minimum.