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Employment contract cannot be linked to service agreement renewal: ruling from Russia

The Constitutional Court of the Russian Federation has held that linking the term of an employment contract to a service agreement with a customer is unlawful.


A fixed-term employment contract was annually renewed, based on the duration of the services agreement with the company’s customer. The employee concerned considered this was unlawful and filed a claim with the court. The lower courts supported the company and did not reclassify the fixed-term employment contract as being open-ended. The employee filed a complaint with the Constitutional Court of the Russian Federation.

The Constitutional Court examined the complaint. It pointed out that the fixed-term of an employment contract cannot be determined by the execution of an agreement with a third party for the provision of services that comprise the main registered type of activity of the company.

This rule applies even if the employee’s activities are only required by the company for the period of the specific civil contract with the counterparty to that contract.

In addition, the court also emphasised that prolonging a fixed-term employment contract with the same employee for the same job position several times actually demonstrates the absence of obstacles to entering into an open-ended employment contract.

Source: Resolution of the Constitutional Court of the Russian Federation, dated May 19th, 2020 No. 25-P

For a full digest of recent Russian case law relevant to employers, click here.

Firm: Alrud

Margarita Egiazarova
Senior Associate