Reduction of staff (TK RF). Reduction Allowance
Sometimes the reason for the dismissal of one or more employees of the enterprise becomes not the decision of the employer or the employee himself, but an objective necessity. The situation may be related to the transition to a new (automated) level of production or to the fact that the organization no longer needs the same number of employees. In such cases, there is a reduction in the number or staff.
For the employer, it becomes a legal tool to optimize the composition of staff and the structure of staffing. However, the use of such a technique is associated with a large number of nuances and requires adherence to many rules.
Basic concepts and terms
In order to understand the subtleties of the topic and understand who, how and under what circumstances can be fired, if there is a reduction in staff, you should decide on the main concepts:
- The number of employees refers to the number of all employees of the enterprise, in other words, it is payroll. If it is about dismissing several representatives of the same profession who perform similar functions, while retaining positions in the staffing table, then this is a reduction in the number of employees. An example would be the dismissal of three out of five architects.
- The staff of employees is absolutely all positions represented in the company (managerial, administrative, workers, and others). Their list represents the staffing table, in accordance with which the structure of the organization’s personnel is formed.
- Reducing the number of staff is necessary in order to exclude from the list of positions overlapping, or those that can be combined into one full-time unit. Also, this concept includes activities aimed at eliminating any unit.
This means that staff reduction is accompanied not only by a decrease in the number of employees with the same duties, but also by the dismissal of all employees performing specific labor functions.Returning to the example given above, with a reduction in staff, all five architects will be dismissed. It may be more profitable for the enterprise not to keep these employees on staff, but to hire them from time to time to perform a separate task (outsourcing).
Dismissal legislation due to downsizing
The legal aspects accompanying the breakdown of labor relations due to changes in the structure of the staffing table are regulated by the Labor Code of the Russian Federation. A reduction in the number of employees (due to the liquidation of the organization or a change in its owner) is discussed in Article 81. Other common situations that are associated with the termination of contracts with employees on the initiative of the employer are listed here.
Among other cases, this article provides a procedure for dismissing employees:
- Because of a truancy.
- Due to a violation of labor discipline.
- Failure to comply with labor protection standards.
Who can be cut
The decision on which the reduction in the number of employees or the number of employees depends is taken by the employer, but at the same time he must take into account the rights of workers who enjoy certain benefits.
When considering candidates for employees to be dismissed, the head must comply with the rule set forth in Art. 179 TC.It states that staff redundancy should be at the expense of the least qualified personnel, who have the lowest labor productivity indicators. The practical implementation of this rule is often associated with the evaluation of the experience and length of service of workers. It is assumed that those who have recently worked at the enterprise are of the least value for the team.
To assess the significance of an employee, the result of the qualification exam, his education and the level of indicators for the previous period are also of great importance. This means that when comparing two employees holding the same position, preference will be given to someone who has a higher education. His colleagues, who received a secondary special, are likely to fall under the reduction.
Categories of staff who are not affected by layoffs
Reducing the staff does not affect the following categories:
- Parents of children with disability status.
- Mothers and fathers raising children independently (loners).
- Parents of large families until the younger child is 14 years old.
- Citizens who are the sole breadwinners of their families.
- Employees who have suffered a professional injury or disease due to their work in this company.
- Disabled victims of wars, the Chernobyl disaster or the Semipalatinsk tests.
- Employees of the company with awards (hero of the USSR, holder of the Order of Glory) or the title of inventor.
- Employees who combine the performance of their labor functions with training.
Dismissing staff does not affect employees who are members of the union or act as elected representatives of the working group and participate in negotiations with the company’s management.
Also, employees who are on sick leave, regular or maternity leave cannot be fired. True, this can be done with their written consent or with the complete liquidation of the company.
How to cut pensioners and part-timers
The Labor Code of the Russian Federation (Art. 3) prohibits employer discrimination by age. Most often this applies to employees who have reached retirement age and continue to fulfill their official duties.If necessary, they will also be affected by downsizing, but using their social status as a reason for dismissal is illegal.
Taking into account the experience and qualifications of pensioners, on the contrary, they fall under the definition of employees with preferential rights. Based on the fact that they can be among the most useful employees of the enterprise, they are reduced in the last place.
Planning the dismissal of an employee combining two positions, the employer performs almost all standard actions. The only difference is that the law does not establish whether he should charge payments to such an employee.
In fact, allowance for staff reductions is necessary for those who lose a source of income. However, remaining in the company, the part-time worker continues to receive wages. Here, the decision on payments and their amount remains with the employer.
Why employers resort to reducing
The state permits business leaders to make their own decisions about the need to reduce staff or number of staff. However, in the event of a dispute, the economic feasibility of these measures can be checked by judicial authorities.
This condition imposes on the employer the obligation to inform his subordinates about why the reduction of staff is carried out. This information is set out in the relevant order and may be associated with the following factors:
- With low profitability. The lack of profit does not allow management to pay for the work of the previous number of employees at a proper level. By reducing labor costs, an organization can save some money to pay off debts or purchase a new batch of materials.
- Inefficient structure of the state. If among the positions of the organization there are those that duplicate each other or do not represent value for doing business, their elimination will be justified.
- The introduction of new technologies or equipment. When production becomes more automated and does not require the participation of the previous number of employees, staff reduction can significantly reduce costs and increase profitability.
What rules should an employer follow when reducing staff
The procedure of forced dismissal can significantly affect the welfare of those employees who are subject to reduction.Not always they have the opportunity to find a workplace with the same conditions as in this enterprise. For this reason, the state dictates to managers certain conditions, the observance of which to a certain extent protects the interests of the dismissed workers:
- The reduction procedure must be followed completely and rigorously. In the event that the employer has entered into a collective agreement with the employees or labor contracts contain any special guarantees that come into force upon dismissal, their implementation is also mandatory.
- Dismissal redundancy must be justified. If in the course of the court proceedings it is established that, from an economic or organizational point of view, the reduction was not necessary and justified, the actions of the employer may be deemed illegal.
- The employment service must be informed of the impending reduction. This condition is of great importance for the recognition of the procedure as legal, therefore its non-observance threatens the employer with sanctions and fines.
In the case when the company’s management “forgets” to inform the employment service ofhis intentions, in addition to fines, the court may oblige them to pay wages to employees for forced absenteeism.
How is the reduction of staff: step by step instructions
Any head of a company or organization planning and conducting staff redundancy activities must be aware of and comply with all laws and regulations. Ignoring or inadvertent violation of one or several rules may entail quite serious consequences: a fine or a court proceeding.
On this basis, the employer is interested in implementing a phased reduction of staff (the Labor Code establishes a list of the necessary documents and procedures):
- The publication of the order announcing the planned event. The staff reduction order must be issued at least two months before the date of the dismissal (Art. 180 speaks about this). The employee, whose position will be abolished, learns about it from the immediate superior. He is given an order to reduce staff for review. After the employee reads the order, he must sign a document proving his consent and lack of complaints.It is necessary to distinguish the order of reduction and the document issued when each employee is dismissed.
- The state obliges the employer to offer employees, who are planning to reduce, an alternative position in the enterprise. This should take into account the level of skills and qualifications of the employee. Such offers are not a one-time action, as the dismissed specialists should be the first to know about vacancies in the company. The result of the notice of vacancies becomes either the employee’s consent to transfer, or the refusal in writing (with the obligatory indication of the date).
- If the enterprise has a trade union organization, it must be notified that layoffs are to be dismissed. In the case when the reduction will be massive, the employer warns this organization for three months, in other situations - for two. These requirements are put forward by the Constitutional Court of the Russian Federation. The task of the union is to formulate a response (reaction to the message of the reduction). The document must be filed within a week from the date of notification, if there are objections, representatives of the organization of workers and the management of the company shall coordinate the positions no longer than three days.If agreement cannot be reached, the company may make reductions, but the union is allowed to file a complaint with the Federal Labor Inspectorate. Having reviewed the case materials, this body has the right to recognize the actions of the company's management as illegal and insist on the restoration of an unfairly dismissed employee in the position (and the employer will be obliged to compensate for the subordinate all forced absenteeism). In a situation where company managers do not consider themselves guilty, they can go to court to appeal the decision of the Labor Inspectorate.
- As already mentioned above, the employer must inform about the impending reduction of the staff of the employment service representatives two months before the event itself (or three in case of mass layoffs).
In the case when the employee does not agree to transfer and continue cooperation with the company, the last one on the list of required documents is the order for his dismissal. The standardized form for this document is T-8.
How retirement redundancy ends: vacation pay, severance pay
The dismissal of an employee who is on time informed and abandoned the proposed vacancies takes place simultaneously with the payment of all the necessary funds.
Together with the workbook, the former employee is given:
The company continues to pay employee benefits for two more months in case of staff reductions, if he is listed on the labor exchange but cannot be employed. Its size is set at the level of the average salary, but it does not take into account the amount that has already been issued.
In the case when an employee wants to quit before the deadline set by the employer, he must be paid the money accrued for the time that has not been worked out. That is, in fact, he will in any case be paid a two-month period between the announcement of the reduction and the date on which this procedure is scheduled.
Payments to certain categories of staff
The order of reduction of some workers is slightly different from the one described above. This is due to the non-standard nature of their work functions or to special circumstances:
- For those workers whose duties are considered seasonal, payments for staff reductions are equal to the average salary for two weeks.
- Employees of organizations located in the Far North are charged one-time severance pay and the average salary for three months (if they are not employed earlier).
What will be indicated in the workbook
According to Art.81 TC staff reduction is indicated as the basis for termination of the employment contract in the employee's workbook. It is issued on the day of dismissal along with the accrued amount of money. When they are received, the former employee of the enterprise signs in several documents (personal card, book of accounting for the movement of workbooks, insert).
The signature of an employee of the personnel department (who maintains employment records) and the employee being dismissed himself, as well as the seal of the manager, becomes the certification of the record that the employment contract is broken.
What should be the behavior of the employee during the reduction
When a person receives a notice that they plan to reduce it, they should take the following actions:
- Inquire about the list of persons who are not entitled to dismiss and find out if he is not in this category. In the event that they will be discovered any factor that gives the right to privileges or benefits, this should be stated in a letter and transferred to the head. The best option is to compose a letter in two copies. One of them is given to the management with a request to put a mark of receipt on the second.This will be useful evidence in favor of the employee if the case goes to court.
- Present requirements for an alternative place of work in the enterprise. The employee does not have to agree to the offer, but a written refusal by the employer in the provision of vacancies may also be grounds for the cancellation of the reduction decision.
- To receive additional payments, you need to register with the employment service for a period not more than two weeks after the staff reduction was carried out. The Labor Code of the Russian Federation indicates this period Then the employee is entitled to a two-month allowance (average wage) if he fails to find a new job.
The most important aspect is that the employee should not write a letter of resignation himself after he becomes aware of the impending reduction.
Also, you shouldn’t give in to the chief’s persuasion and compromise, since dismissal by agreement of the parties does not provide for severance pay.
Professions at risk
Given the difficult economic situation, the cuts can affect a fairly wide range of companies and organizations.Doctors and educators may not be afraid for their places, but many firms will still undergo reorganization.
The financing of the following professions may be limited among employees of state-owned enterprises:
- Employees involved in telecommunications.
- The librarians.
- Mail employees.
- Employees Mosgostransa.
- Reducing the staff of the Ministry of Interior.
In addition, new jobs will have to look for some employees of state and commercial banks.
Experts say that against the background of such a disappointing situation and in the absence of a pay rise, many highly qualified personnel will be dismissed on their own initiative. Without waiting for the reduction, they will learn new current professions or look for the use of their talents in other countries.