Amendments to the RA Labor Code

Senior Lawyers of "Concern-Dialog" Law Firm Zhanna Simonyan's and Koryun Tamrazyans' interpretation of the amendments of RA Labor Code enforced starting from August 7th, 2010
AMCHAM
AMCHAM

The RA Law on Amendments and Restatements to be made in the Labour Code of the RA were put into force on August 7th, 2010. Employers usually face some problems after changes in legislation concerning the correct interpretation of newly updated laws; therefore, we will try to introduce the most applicable amended articles of the RA Labor Code and hope this article will be a useful tool for our partner companies.

Article 17: The Employee

1. The employee is a legally capable citizen over the age stated in this code who works contractually for the employer in pursuant of a certain profession, specialization or position.

2. People aged 14 to16 under an employment contract with the employer with the written consent of a parent or guardian are also considered as employees.

2.1. People aged 14 to 16 can only work temporarily and only in jobs that do not damage their health, safety, education or ethics according to the Article 101, the 1st point of the 1st part of Article 140 and Article 155 of this code.

3. People aged 14 to 18 shall not work on holidays, memorial days and nonworking days but may participate in a sporting or cultural event held on those days.

4. A temporary employment contract is signed with people aged 14 to 16.

Comments

Point 2.1 is new to Article 17 of the Labor Code and directs more attention to the employment of minors. Work limitations for people aged 14 to 16 are highlighted in points 2.1 and 3.

Article 84

The Content of Individual Legal Act on Admitting to Work.

1. The following shall be mentioned in individual legal act on admitting to work:

1) The year, month, date and location of adoption of individual legal act,

2) The employee’s name, surname, middle name,

3) The company name or the name, surname, and middle name of the employer,

4) The name of the relevant department if there is one,

5) The date the job will officially begin,

6) The position and (or) work responsibilities,

7) The salary and/or the way of determining it,

8) Defined premiums, subsidies, and other benefits the employee may receive,

9) The term of the employment contract (if necessary),

10) The duration of the probation period – by the mutual agreement of the two parties,

11) Working hours if the job is not full-time,

12) The basis of the legal act (the employee’s application, the agreement to transfer an employee to another employer, written employment contract, etc.) if there is one,

13) The position, name and surname of the person signing the contract.

2. The points from 2 to 11 of part 1 of this Article, as well as the year, month, date and the place contract is signed are mentioned in the written employment contract.

3. Other conditions can also be included in the individual legal act on admitting to work and to the written employment contract by mutual agreement of the two parties.”

Comments

The 84th Article of the Labor Code of the RA has been re-edited, the main change being that an the working relations between the employer and the employee can be based not only on the signed contract, but in case of mutual agreement of the parties on the individual legal act on admitting to work, which must contain all the mandatory conditions mentioned in Article 84. A copy of the individual legal act on admitting to work must be given to the employee at least 3 days after it is adopted.

In our opinion the legislation is trying to make relations between employer and employee more flexible however with this amendment it didn’t reach its goal.

Article 84.1.

Employment Contracts and the Law

1. An employment contract must correspond to the law in force at the time the contract is signed, or as defined by other normative legal acts (imperative norms).

2. If a law or another normative act  defining other necessary rules for the parties other than the acting rules defined when the contract was signed, the conditions mentioned in the contract retain their force, except in the cases when it is defined by the law or other normative legal act that its force is extended to the relations of the previously signed contracts. The employment contract must correspond to the requirements of legislation if the latter has defined more favorable conditions.

Comment

By adding the Article 84.1 to the Labor Code the concept of  “retroactive law” used in jurisprudence has been introduced, meaning that when laws are amended to define more favorable working conditions, they also apply to contracts that have been signed before the adoption of that law. If working conditions are made worse by an amendment, they do not apply to contracts signed before the law is adopted. As such, legal relationships are regulated according to the legislation acting during the period they were agreed upon.

Article 90.

The Employment Record Book

1. The employment record book is the main document containing information about an employee’s work activities.

2. The employer must keep employment record books for all the employees in the main office.

3. The followings must be contained in the employment record book:

1) The name, surname, and middle name of the employee,

2) The employee's date of birth,

3) The working period according to the employment contract,

4) The period that unemployment benefits may be received (to be filled in by the authorized body.)

5) The period of staying in the reserve of local services, which according to the normative legal acts, is calculated as working experience (to be filled in by the authorized body.),

6) The existing study period in vocational and higher educational institutions (is filled by the employer where the person has started working experience after graduating from the educational institution),

7) The period of mandatory military service (to be filled in by the employer where the person has started working after being discharged from the army),

8) The number and adoption date of the legal act.

Comment

            Points 4 through 8 are new additions, according to which an employer must keep employment record books with information concerning the education period and name of the vocational institution or place of higher education for employees coming to work directly after graduation, and the period of mandatory military service for employees who began work directly after being discharged from the army.

            This amendment clarifies the way an employee's social security history will be calculated.

Article 95.

Fixed-Term Employment Contract

1. A fixed-term employment contract can be terminated if working relations are not defined for an indefinite period, taking into account the nature and conditions of the job and except as provided for by this code.

2. A fixed-term employment contract can be concluded for a certain period of time or by certain calendar days or for the period of performance of certain work.

3. A fixed-term employment contract can also be concluded:

1) With employees who work in an elective position for an elected period,

2) With employees who work in a secondary workplace,

3) With employees who do seasonal work,

4) With employees who do temporary work (up to 2 months),

5) With employees who substitute an employee on leave,

6) With foreigners by the terms defined by their work permits or their residencies.

Comment

This article clarifies fixed-term employment contracts. Previously this article stated that an employer cannot sign a fixed-term employment contract lasting more than 5 years; employers misunderstood and were signing fixed-term contracts with their employees even when their work was not temporary. As a result, employers were trying to terminate contracts after they expired; the employees could fight to retain their positions in court. An accountant cannot be considered a job with a temporary nature and the employer cannot sign a fixed-term employment contract with him/her unless he/she works in 2 or more companies or is filling in for another employee on leave.  According to this amendment an employer can conclude a fixed-term contract if the work has a temporary nature; the work will be terminated according to the date set in the contract which can be based on circumstances including on the conclusion of a temporary project, and cannot be limited to five years as it was before the amendment.

Article 115.

Notification about the Termination of the Employment Contract

1. In case of termination of an employment contract on the bases of the 1st and 2nd points of Article 113 of this Code, the employer must give the employee a written notice 2 months prior.

In case of the termination of the employment contract, based on point 9 of the 1st part of Article 109 and on the 3rd, 7th and 11th points of the 1st part of Article 113 the employer must give a 14 day prior written notice if the employee has worked for less than one year, a 35 day written notice if the employee has worked from 1 to 5 years, a 42 day written notice if the employee has worked from 5 to 10 years, a 49 day written notice if the employee has worked from 10 to 15  years, and a 60 day notice if the employee has worked for more than 15 years.

...

Comment

The second paragraph of Article 115 has been amended to define certain different terms of notifications for the termination of the employment contracts. Such a change is very important in the sense that it creates more favorable conditions for employees who have worked at the company for a long time, and senior workers will have enough time to find a new job. The same principle is used in the amendment to Article 129 (concerning severance pay), according to which an employee who has worked for a longer period of time is given more severance pay; this is a very important and positive step.

Article 148.

Working at Night

1. Night-time is defined as the period between 22:00 and 06:00.

2. Work performed at night is considered to be night-work.

3. People under the age 18 and workers who are forbidden to work at night by a medical certificate are not allowed to work at night

4. Pregnant women and those who take care of a child under the age of three years can be employed at night only with their consent.

5. (The 5th part is not in force 24.06.10 RC-117-)

6. If it is established that the night work is harmful to the health of the worker, the employer is obliged to transfer the worker to work in the day-time.

Comment

Previously the the employers had problems concerning the correct interpretation of the 2nd part of Article 148 (work at night), as it defined that work is considered to be night work if 3 working hours are during the night.  According to the new amendment, night work is considered to be work performed from 22:00 to 06:00By the way according to the new change the duration of the night time work is not reduced by one hour.

Article 159. Annual Minimal Leave

1. The duration of the annual minimal leave in case of five-working-day weeks is 20 working days. In case of six-working day week the annual minimal vacation is 24 working days.

2. The annual leave of workers with incomplete working hours is not reduced.

3. Longer-term leaves can be defined by a collective agreement, by employment contracts or by the employer’s legal act in companies financed by the state, the community budget or the Central Bank of RA.

Comment

From now on annual leave will be given as working days instead of calendar days, and instead of 28 calendar days the employee will have 20 working days of minimal paid leave annually if they work a five-day week and 24 working days if they work a six-day week.

Article 163.

Granting of Annual Vacation in Installments

Annual leave can be given in installments according to the mutual agreement of the parties. If annual leave is given in installments, one installment may not be less than 10 working days in the case of a five-day week and no less than 12 working days in the case of a six-day week.

Comment

Legislation is recognizing that employees cannot completely rest and regain their energy and efficiency if they only have shorter vacations than are defined in the article.

Article 183.

Compensation pay for hard and hazardous work, and for particularly hard and particularly hazardous work

1. The employee is paid a premium in case of performing hard, hazardous, particularly hard and particularly hazardous work defined by the legislation of RA.

2. The employee is paid a premium of no less than 30% of his tariff salary in the case of work defined as hard and hazardous. The employee is paid a premium of no less than 50% in the case of work defined as particularly hard and particularly hazardous.

Comment

The article 183 of the Labor Code has been fully amended, and the premium for workers performing hard, hazardous, and particularly hard and particularly hazardous work has been reduced for reasons unknown. Previously, employees performing hard and hazardous works were entitled to an additional 50% premium of their salaries; this has been reduced to 30%. Employees in particularly hard and hazardous works were entitled to an additional 100% of their salaries, which has been reduced to 50%.

Article 184.

Compensation pay for Overtime and Night-Work

Besides the hourly rate a premium is paid for each hour of the overtime work, which shall not be less than 50% of the hour rate, and not less than 30% of the hour rate for each hour of night work.

Comment

Compensation for overtime work and night work has also been changed to the employee’s detriment. According to the amendment, a worker is entitled to 50% of his or her hourly wage for each hour of hour of overtime, and 30% for each hour of night work. Previously, employees were entitled to a premium of 150% of the hourly rate for overtime and night work.

Janna Simonryan,

Koryun Tamrazyans

“Concern-Dialog” Law Firm

1 Charents str., Office 207 Yerevan, 0025, Armenia

+374 60 27 88 88 +374 10 57 51 21

1 Charents str., Office 207 Yerevan, 0025, Armenia

+374 60 27 88 88 +374 10 57 51 21