Statement by the KVPU
Despite repeated warnings from the Confederation of Independent Trade Unions of Ukraine (KVPU) and other trade union organizations and international institutions, the parliamentary majority nonetheless approved the first reading of draft law #5371 “On amendments to certain legislative acts aimed at improving labour relations in small and medium-sized enterprises and reducing the administrative burden on business activities”.
As stated in the explanatory note, the aim of the bill is to improve the regulation of labour relations in the area of small and medium-sized enterprises and to reduce the administrative burden on the activities of enterprises. But in fact, commenting on the adoption of the bill, Mykhailo Volynets, head of the Confederation of Free Trade Unions of Ukraine (KVPU), said that it “frees the hands of employers and in essence undermines workers’ rights”.
The draft law proposes a number of amendments to the Labour Code of Ukraine, as well as to the laws “On Professional Associations”, “On Holidays” and “On Leave”.
A wide range of labour relations have been taken out of the framework of the Labour Code regulations.
In particular, a purely contractual labour regulation regime is introduced :
for small and medium-sized enterprises with up to 250 employees ;
between an employer and an employee whose salary is higher than 8 SMIC per month.
The parties to an employment contract may regulate their relationship in part at their “own discretion on a mutually agreed basis” on :
– remuneration systems ;
– labour standards ;
– the amount of wages, taking into account the legal minimum number of employees ;
– bonuses, earnings and other remuneration, compensation and safety bonuses ;
working hours and rest periods, which must correspond to the length of the working day and the working hours ;
the length of the weekly rest period ;
other rights and guarantees.
This will lead to a deterioration of the employment contract for the employee compared to the current legislation.
The employer has the unlimited right to unilaterally terminate the employment contract on his own initiative (Art. 498(2) in the new Labour Code within the limits of the grounds provided for in Art. 40 and 41 of the Labour Code and Art. 41 of the EPC.
However, the bill does not require the employer to provide reasons for the dismissal. Therefore, an employee will not be able to appeal to a court if his or her rights are violated, because under Bill 5371, the employer is not required to justify the dismissal. The employer is only obliged to pay the compensation fixed in the employment contract.
The KVPU’s legal department believes that the proposal to give the employer the unlimited right to dismiss employees at their request is not in line with European law.
Article 4 of ILO Convention 158 on Termination of Employment at the Initiative of the Employer ;
Article 24 of the European Social Charter.
Bill 5371 also includes other provisions that discriminate against employees.
It allows employers to set different wages for the same work, including allowances, overtime payments, bonuses, etc. The employer will also be able to require employees to work overtime, public holidays, non-working days and weekends.
According to Article 497(1) of the new Labour Law, it is allowed to pay wages to employees once a month. It is true that this is not in line with Article 4 of Section II II of ILO Recommendation No. 85 on the Protection of Wages, which states that the maximum conditions for payment of wages to employees should ensure that wages are paid at least twice a month.
The draft of the new Article 5. Article 21(5) states that : “The relations between the employee and the employer arising from the employment contract, insofar as they are not regulated by this Code, shall be governed by the general provisions of the Civil Code of Ukraine concerning contractual relations.” This is contrary to the basic principles of labour law, according to which labour relations are not civil law relations, as the employer and the employee are not equal parties to these relations (the employer determines the place and time and sets the rules of work performance).
“Such a bill is totally unacceptable for any reason, and quite abusive during the state of war, when employees are already inherently limited in their rights. The Ukrainian government is happy to go along with it for the time being, mindful of its responsibility to preserve the sovereignty and territorial integrity of the state,” added Mykhailo Volynets. The proposed amendments to the labour legislation strongly contradict the Ukrainian Constitution, the International Labour Organisation conventions ratified by Ukraine, the European Social Charter and the EU directives that Ukraine aspires to join. The draft law has also been assessed negatively by law enforcement organizations in Ukraine and abroad, as well as by the International Trade Union Confederation and the International Labour Organisation. Ukraine needs a civilised European labour code that will be a driving force for the return of workers abroad and displaced persons in order to rebuild our country. Therefore, the main priority of the authorities should be the creation of socially satisfying jobs and ensuring social justice. But for the time being, it is a pity that some representatives of the authorities have an interest in making Ukrainians of working age go to work abroad or stay here with diminished rights for low wages.
Furthermore, the opinion of the European Integration Committee on this document is as follows : “The draft law in the proposed wording weakens the level of labour protection and reduces the scope of labour rights and social guarantees of employees compared to the current national legislation. This is incompatible with Ukraine’s obligations under the Association Treaty and is not in line with EU law.
Therefore, it will be useful to remind the authors of the bill №5371 and those who voted for its adoption in the first reading that this and similar legislative initiatives harm workers’ rights. The MEPs are not shortening, but lengthening Ukraine’s path to the EU.
18 May 2022