Consideration of disputes on termination of an employment contract on the basis of subparagraph 3) of Article 52 of the Labor Code (reduction of production, work performed and services rendered, which led to a deterioration in the economic condition of the employer

 

Termination of an employment contract based on subparagraph 3) of Article 52 of the Labor Code (reduction of production, work performed and services rendered, which led to a deterioration in the economic condition of the employer, introduced in the new Labor Code.

According to paragraph 2 of Article 53 of the Labor Code, upon termination of an employment contract on the grounds provided for in subparagraph 3) In paragraph 1 of article 52, the employer is obliged to notify employees in writing of the termination of the employment contract fifteen working days in advance, unless a longer notice period is provided for in the employment or collective agreements. By agreement of the parties, the notice period may be replaced by the payment of wages proportional to the unpaid period. In the notification, the employer must indicate the reasons that served as the basis for the termination of the employment contract.

Termination of an employment contract on this basis is possible if the following conditions are met at the same time:

1) closure of the structural unit (workshop, site);

2) the inability to transfer an employee to another job;

3) a written notification at least one month in advance to employee representatives indicating the reasons that served as the basis for termination of the employment contract (there is a direct link between the economic changes in the employer and the need to terminate the employment contract).

In practice, judges have questions about what is meant by a decrease in the volume of production, work performed and services provided, which has led to a deterioration in the economic condition of the employer? How are production reduction calculations performed? Will this rule cause abuse by employers, monopolistic enterprises, since production volumes are declining everywhere in the context of the global economic crisis? How will the employer's obligation to fulfill the condition that an employee cannot be transferred to another job be implemented?

               We believe that if an employer dismisses employees due to a decrease in production, work performed and services rendered, which have led to a deterioration in the economic condition of the enterprise, then the court has no right to discuss the economic feasibility of the measures carried out by the employer. An employer cannot be limited in choosing a strategy and tactics for carrying out his economic activity and determining the sufficiency of employees to carry it out. When considering cases in this category, the court should evaluate only the legality of the dismissal of employees, and not the justification for reducing their number.

               At the same time, there are doubts about how justified this innovation in the Labor Code is, it would not be easier to limit oneself to another, similar, ground for termination of an employment contract provided for in subparagraph 2) of Article 52 - to reduce the number or staff of employees.

               The following example of a labor dispute is not related to dismissal based on subparagraph 3 of Article 52 of the Labor Code, since the employee was dismissed in 2015, i.e. during the validity of the previous Labor Code, which did not provide for dismissal on such grounds. But in fact, the reason for the dismissal was the economic feasibility of releasing jobs.

               Ya.A.V. worked as an assistant driver of the traction unit of the Udarnaya rolling stock depot of the Northern Stripping Complex of the Bogatyrsky Loading and Transport Department Bogatyr Komir LLP. The employer argued in court that due to the decrease in 2015 in actual production volumes from 37 million tons of coal to 32 million tons per year, there was a situation with a systematic release of staff numbers, since staffing was carried out in previous years to provide 40-38 million tons of coal per year. The planned volume of coal production for 2016 is 32 million tons. Due to the impossibility of ensuring the workload of employees of certain professions at their main place of work, based on the calculation of the number of staff for the 4th quarter of 2015, taking into account the number for 2016 (1st quarter), the defendant issued order No. 812 dated 08.10.2015 on staff reduction. Based on the memo of the director of the Bogatyrsky Loading and Transport Department (hereinafter - BPTU) No.1.2-1-07/1822 dated 20.10.2015 The Director of Personnel and Social Policy signed Order No. 1117 l/s dated 10/23/2015 on the warning about the upcoming reduction of BPTU employees, including the plaintiff Ya....

               The Court of first instance, resolving the dispute, proceeded from the requirements of paragraph 1 of Article 56 of the Labor Code. A reduction in the number or staff of employees is the basis for termination of an employment contract at the initiative of the employer in accordance with Article 54 of the Labor Code, while in the event of termination of the employment contract on this basis, the employer is obliged to notify the employee in writing directly about the termination of the employment contract one month in advance, as required by paragraph 1 of Article 56 of the Labor Code. The employer notified Ya.A.V. on the termination of the employment contract on 07.12.2015 and on the same day issued an order to terminate the employment contract.

               The court correctly recognized the unfounded arguments of the defendant that the notice of the upcoming reduction dated October 23, 2015 was a warning about the termination of the employment contract. The defendant's actions in handing Ya.A.V. the notice of termination of the employment contract dated 07.12.2015 are consistent with the requirement of paragraph 1 of Article 56 of the Labor Code, however, the order to terminate the employment contract was issued in violation of the time required for the warning. From the analysis of the documents submitted by the defendant, the court found that there was no actual reduction in the number and staff of BPTU employees.

The judicial board, having assessed the collected evidence in its entirety according to the rules of Article 68 of the CPC, indicated in the decision that the court of first instance reasonably concluded that the claim had been satisfied.

 

 

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