Dismissal as a Disciplinary Action
A list of disciplinary actions which can be applied to employees is included in Article 192 of the Labor Code of the Russian Federation (hereinafter referred to as “LC”). Such actions are:
dismissal when appropriate.
This list is closed and is not subject to broad interpretation. Other disciplinary actions may be considered only by federal laws, statutes and regulations on discipline of individual categories of employees (LC Article 192).
Clarifications on the application of this type of action are contained in Sub-points 33-53 of the Plenum of the Russian Supreme Court’s Resolution #2, dated March 17, 2004, “On Russia’s Courts’ Application of the Russian Labor Code” (hereinafter referred to as “Plenum”).
If there is a violation of the dismissal procedure, the employee may be reinstated to his former position with pay for the entire period of the forced absence, while the employer risks facing administrative liability.
This article will examine some examples of how dismissal is applied according to the different provisions in LC Article 81 which have been supported by judicial practice.
Example #1. Often in practice, an employer must dismiss an employee because of the employee’s repeated failure to fulfill his duties without a reasonable excuse if he has already been disciplined (LC Article 81, Point 5).
On this particular basis, there is a practical example from the St. Petersburg City Court: Cassation Ruling #33-11608/2011, dated August 1, 2011, which pronounced such dismissal orders unlawful.
Case materials show that, by order of a company’s general director on September 18, 2010, employee G., who had been employed with the company since December 1, 2004 as manager of the floor personnel staff, was issued a warning about failure to fulfill his duties as stipulated in Point 3.8 of the position description in his labor contract; specifically, he did not order his subordinates to provide an explanation for several instances of intrusion and theft in the business center, as he was ordered to do by the company’s management.
An order from the same day was also issued to G., reprimanding him for failure to fulfill his duties stipulated by the labor contract and Point 5.1.3. of his position description; specifically, he did not fulfill the general director’s instructions to immediately come to the business center to ensure that the floor personnel were conducting increased security work uninterrupted, did not provide a replacement officer for his post, thus allowing the post to be vacant, and did not ensure that his subordinates were prepared to strengthen the facility’s security regime.
Subsequently, on September 20, 2010, the company’s general director ordered that G. be dismissed for failure to fulfill his professional obligations, taking into account the previously imposed disciplinary measures based on LC Article 81, Point 5 (employee’s repeated failure to fulfill his duties without a reasonable excuse, if he has already been disciplined). G. took the matter to court in order to defend his right to challenge the dismissal order and the orders to disciplinary action as unlawful, as well as to be reinstated his position at work and receive pay for the forced absence and compensation for non-pecuniary damages.
The court’s decision partially satisfied G.’s demands. The court ruled that the plaintiff’s dismissal was unlawful, ordered him to be reinstated to his position and ruled in favor of granting pay for the forced absence and compensation for non-pecuniary damages. The rest of the plaintiff’s claim was dismissed. State fees were also ordered to be collected from the defendant (employer). The only part not granted was the request to rule that the order to impose the disciplinary action was unlawful.
When reviewing the legality of the disciplinary action imposed on the plaintiff, the court, following the Plenum’s instructions, studied all periods of misconduct and imposed orders and determined that the employer brought G. to disciplinary responsibility on September 20, 2010 for misconduct alleged against him on August 7, 2010, after the time period for bringing the plaintiff to disciplinary responsibility had already expired.
The court ruled that the case material did not give sufficient grounds to conclude that the plaintiff’s alleged misconduct was significant enough to require the application of such extreme measures of disciplinary action like dismissal. The defendant did not provide evidence to the court that the violations indicated led to significant consequences for the working process. The result was a negative court ruling for the employer and additional expenses.
Conclusion: Inasmuch as dismissal for failure to fulfill professional obligations is a disciplinary action, it needs to be applied according to the regulations stipulated for imposing such disciplinary measures. These regulations are fixed in LC Article 193. First, a written explanation of the misconduct must be requested from the employer; if the employer refuses to give such an explanation, a document pertaining to this should be written up in the presence of two to three witnesses. Then an order of dismissal will have to be issued and the employee should be familiarized with it upon receipt on the day of dismissal (order form #T-8 established by State Statistics Service Directive #1 from January 5, 2004). An act is written up if the employee refuses to sign the order. After the order is issued, a note about the dismissal may be put in the employee’s work record and his employee data card may be closed with form #T-2.
Typical mistakes made when dismissing an employee for unauthorized absence or failure to fulfill official duties are:
the employee did not have disciplinary actions taken against him or they were imposed unlawfully or after the statute of limitations for imposing them expired; violation of deadlines and justifiable dismissal procedures (LC Article 193);
prior consent was not received from the Russian Labor Inspectorate and the Commission on Juvenile Affairs for dismissing an underage employee (LC Article 269).
In Example #2, we review current practice for dismissing employees according to LC Article 81, Point 6, Sub-point g. Grounds for dissolving the labor agreement at the employer’s initiative can be workplace theft (including minor theft) of someone else’s property, embezzlement, willful destruction or damage, as long as these instances are established and entered into force by a court ruling or resolution by a body authorized to apply administrative penalties (LC Article 81, Point 6, Sub-point g). Dismissal is possible both for theft of the employer’s property, as well as for theft of property belonging to other employees or to third parties.
Instances of theft (embezzlement, destruction or damage) of property and the employee’s guilt shall be established by a resolution entered into law or court ruling (LC Article 81, Point 6, Sub-point g; Point 44 of the Plenum’s Resolution). Since the LC speaks specifically about theft (embezzlement, destruction or damage), then the ruling (resolution) should be imposed specifically on this matter. Therefore, if such a document only affirms an attempt at one of the actions indicated, there is no basis for dismissal according to this point.
The following is from case materials of a resolution dated August 5, 2004 from the Presidium of the Samar Regional Court: citizen Ts. filed a lawsuit against AvtoVAZ, JSC to be reinstated to his previous position with pay for the period of his forced absence. The plaintiff indicated that he worked for the defendant as a delivery driver but, on April 16, 2003, the Avtozavodskaya Regional Court in Tolyatti pronounced him guilty of a crime according to Article 30, Part 3 and Article 158, Part 2, Point a of Russia’s Criminal Code. He was subsequently sentenced to one year of correctional work and 10% of his monthly wages were redirected to the state. Since correctional work is to be served out at the main place of work, Ts. stated that his dismissal according to LC Article 81, Point 6, Sub-point g (property theft at the workplace) was unlawful according to the order from May 22, 2003. The Avtozavodskaya Regional Court’s decision from July 10, 2003 satisfied Ts.’s claims: it ruled that he should be reinstated to his place of work starting May 23, 2003 as a delivery driver for the AvtoVAZ plant and should be granted pay for the time of the forced absence. The court’s decision in the first instance was upheld by a determination from the Samar Regional Court’s judicial board on September 17, 2003.
Conclusion: Dissolving the labor contract according to LC Article 81, Point 6, Sub-point g is one measure of disciplinary action, therefore the employer should follow the procedures and conditions for applying disciplinary measures, which include statutes of limitations for their application. It should be noted that when dismissing an employee on this basis, the one-month period for applying the measure begins not from the day that the misconduct was discovered, but from the day that the court ruling comes into effect or from the day that the decision to apply administrative penalties was made.
As Example #3 we present LC Article 81, Sub-points 7 and 8, which were introduced by lawmakers in order to prevent adverse consequences related to employees fulfilling their work functions when the employer has reason to assume that the employees cannot or should not be doing their particular type of work due to personal or moral qualities.
These can be employees who:
deal with cash or merchandise
work in the education field and have direct interaction with children.
The Plenum clarified the first point in Resolution #63 from March 17, 2004, and explained the situation in the following manner.
Committing these wrongful acts which give reason to lose trust in employees who directly deal with money or merchandise (for example, tellers, cashiers, collectors, storeroom clerks, etc.) may be regarded by the employer (due to account cheating, false weighing, failure to preserve property – shortages, personal use of entrusted property, receiving payment for services without the corresponding documentation, etc.) as grounds for applying disciplinary measures if these actions are committed while the employee is performing his work duties.
Regarding the second point, an employee in the field of education may be dismissed for committing an immoral offense at the workplace and in conjunction with his professional duties, as long as the procedure for applying disciplinary measures is adhered to.
An immoral offense is an offense which contradicts conventional morals (being inebriated in public places, using vulgar language, fighting – in other words, degrading behavior and indecent acts which discredit the employee) and is committed while performing work duties. This definition is subjective. It is assumed that not all immoral offenses can be grounds for dismissal, but only those which allow one to judge that the employee is not able to continue fulfilling his work functions in such an environment. Only the employer can judge this, since the law does not provide any criteria. However, it is important to note that any such acts committed in the home cannot be considered a disciplinary offense.
Conclusion: Loss of trust in an employee should be based on reliable facts which confirm that the employee is indeed guilty of causing material damage, has created a threat of such material damage occurring, or has committed other illegal acts. These reliable facts should be inventory reports, audits of financial and economic activities, sample purchases, etc.
Example #4 will show how disciplinary action in the form of dismissal is applied to employees at the management level, specifically: the manager of an organization (branch or rep office), his assistants and chief accountant make an unjustified decision resulting in the violation of the safekeeping of property, its improper use or other property damage to the organization, thus giving the employer the right to dissolve the labor agreement with the employee (LC Article 81, Point 9). However, an “unjustified decision” is subject to interpretation, since there is no criteria in the law by which to determine what kind of decision is not justified. Therefore, it is to be assessed by the employer (either individually or collectively).
In Point 48, the Plenum explains that the groundlessness of a decision is to be determined in the following manner: have adverse consequences arisen chiefly as a result of the decision made and could they have been avoided if a different decision was made. This indicates the establishment of a direct correlation between the decision made and the material damages, which attests to the material composition of the violation and does not offer clarity into the decision on the matter in question. The Plenum does not take into account that justifiability or groundlessness of a decision may be subjective. Such subjective concepts and what meaning will be given to them depends on who is making the decision or who will be involved in them. Unfortunately, the problem of “subjective” concepts is very often discernible in our legislation.
A mandatory condition for dismissal according to LC Article 81, Point 9 is also the occurrence of damage. Russia’s Labor Code explains the concept of direct actual damage which is grounds for holding an employee materially responsible for an actual decrease in the employer’s property, deterioration of the property (including property belonging to third parties which is located at the place of employment if the employer is responsible for the safekeeping of this property), as well as if the employer incurs expenses or must make excessive payments in order to acquire or restore the property (LC Article 238).
If the employer does not receive any income as a result of the unjustified decision, then he may not dismiss the employee according to LC Article 81, Point 9.
Conclusion: The following criteria for determining an “unjustified” decision can be used in order to give an adequate assessment of a management-level employee’s decision:
The decision was made based on incomplete, inaccurate, insufficient or invalid data;
When the decision was made, not all the data was properly assessed and some of the data was ignored (for example, increased risks [commercial, financial, etc.]);
Data (including, for example, legal regulations) were incorrectly explained or interpreted;
The decision was made on an emotional level, although a number of objective factors should have been taken into account when making the decision;
Consultations or preliminary measures should have been performed prior to making the decision (for example, a review of the organization’s creditworthiness), analytical research, data collection, calculations (for example, of commercial and financial risk, etc.); however, the measures indicated were not taken, thus violating the established procedure.
When making an assessment of the management-level employee’s decision, it is important to remember the second implication of a “justifiable decision,” which is that the employee, which the employer seeks to dismiss according to LC Article 81, Point 9, must have the opportunity to justify his decision.
Finally, we present Example #5. The manager of an organization (branch or rep office) or his assistants may be dismissed if there is a one-time, major violation of his work duties according to LC Article 81, Point 10. The code does not clarify how a major violation of work duties by managers or their assistants should be understood. Therefore, the level of the offense’s severity for which a dismissal may occur is determined according to the discretion of the employer, who has the right to hire and dismiss the persons indicated.
As an example, we review the Moscow City Court’s decision on Case N 33-28491 from September 26, 2011.
Citizen Ts. was appointed general director of the state unitary enterprise Ekhotekhproekt in Moscow based on a three-year labor contract.
The plaintiff was dismissed by an order issued December 28, 2010 on the basis of LC Article 81, Point 10 for a one-time major violation of his work duties as manager of the organization.
Ts. asserts that the dismissal was unlawful since he did not commit a major violation of his work duties and the employer was in violation of the dismissal procedure.
After having evaluated the evidence on the case, the court of original jurisdiction reached the decision that the plaintiff’s dismissal was indeed unlawful according to LC Article 81, Point 10.
The court based this decision on the fact that dismissal on these grounds is unlawful without indicating concrete facts that attest to the manager’s misbehavior and guilt.
The employer changed the date of dismissal to March 28, 2011. However, Russia’s Labor Code does not grant the employer the right to change the date of dismissal for an employee without his prior consent after the professional relationship between the employer and employee ceases.
Therefore, the employer did not abide by the dismissal procedure for the plaintiff and violated the conditions of LC Article 193.
Given such circumstances, the court ruled to fully satisfy all of the plaintiff’s demands.
Conclusion: Despite the fact that there is a rather large list of bases in the LC articles indicated above for applying disciplinary actions in the form of dismissal, it still remains an extreme measure. The employer should apply it carefully and correctly process all documents. The practice of applying the LC in Russia shows that courts and state labor inspectorates try to defend employees’ rights as much as possible in such instances.
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