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Counsel, Ilyashev & Partners
Counsel, Attorney-at-Law, Ilyashev & Partners
Ukrainian Labor Law Reform Inspired By Pandemic
All of 2020 was dominated by the global fight against the coronavirus and its effects on many aspects of day-to-day life. Because of that, all countries had to develop plans not only for fighting the virus, but also for supporting their economies and, where necessary, adjusting their legislation to new realities.
The first case of COVID-19 was registered in Ukraine on 3 March 2020. And on 11 March 2020, the Cabinet of Ministers of Ukraine adopted Resolution No. 211 On Prevention of the Spread of the COVID-19 Coronavirus on the Territory of Ukraine, whereby for the first time quarantine was declared in Ukraine in relation to COVID-19.
Dozens of pieces of legislation (both laws and secondary legislation) followed that first resolution. They related to various areas of law, including taxation, social security, administrative and criminal liability, and so on.
Needless to say, labor law had to meet one of the toughest challenges. Businesses (employers) have been struggling to stay afloat, some of them (including, but not limited to restaurants, cafes, shops, cinemas etc.) being forced from time to time to suspend their normal operations. Employees, on the other hand, tried to keep their jobs while the state, of course, was interested in making sure the unemployment level would not skyrocket.
As more than a year has passed since the beginning of the pandemic in Ukraine, it must be admitted that the efforts of the Ukrainian government haven’t always been sufficient for overcoming the negative effects of COVID-19. For instance, the amount of financial support provided to the business sector has never been anywhere near the amounts spent on the same purposes by the world’s largest economies.
As if to compensate its inability to be a reliable source of financial assistance, the Ukrainian government has been trying to maintain a certain balance between the necessity of keeping the virus under control and keeping the economy running. In this regard, the restrictions applied in Ukraine almost never amounted to the concepts of “complete lockdown” or “closed country”, as operation of only selected businesses was suspended and only where there was absolutely no alternative.
At the same time, in addition to dealing with current issues, Ukrainian lawmakers managed, with reference to coronavirus-related challenges, to substantially update certain areas of labor law which for a long time were in dire need of change.
Flexible Hours, Remote Work and Work at Home
Until 2020 there had been no reference to flexible hours, remote work or work at home in the Labor Code of Ukraine, which seemed absurd in a world where flexibility and diversity of employment forms is a norm. Also, work at home was largely regulated by a Soviet-era act from 1981 with some methodological recommendations dated 1995, all of which were extremely outdated.
On 30 March 2020, Law of Ukraine No. 540-IX was adopted where relevant forms of employment and the rules for their regulation were included in a single article, namely Article 60 of the Labor Code of Ukraine.
Nevertheless, it was apparent that such new regulations weren’t enough and on 4 February 2021, Law of Ukraine No. 1213-IX supplemented the Labor Code of Ukraine with new Articles 60-1 and 60-2, governing working at home and remote work, respectively, and also provided some additional amendments to various Articles of the Labor Code in relation to work beyond the confines of the employer’s office and flexible hours.
The flexible hours regime provides for determining the time of the beginning, end and duration of work during the working day, for a definite period or indefinitely, at the time of employment or later, by an employee himself/herself, subject to written consent between that employee and his/her employer. At the same time, daily, weekly or other norm of working hours should be observed by the employee.
Flexible working hours provide for fixed hours, during which an employee should be present at his/her place of work and perform his/her duties; variable time, during which an employee can, at his/her discretion, determine the periods of work within the established norm of working hours; and break time for rest and meals.
The application of flexible working hours can, in certain cases, be restricted. And, where necessary, the employer can temporarily reassign the work of employees under the flexible hours mode to the general regime of work.
Interestingly, if an employee violates the rules for the flexible working hours, his/her employer may reassign that employee to the general regime of work.
Work at Home
The work at home regime provides for the performance of work by an employee at his/her home or at another place outside his/her employer’s premises chosen by that employee and having a working area and the necessary technical means.
In the case of working at home, the employer’s workplace is fixed and cannot be changed at the employee’s initiative without the consent of his/her employer. Only in cases outside the employee’s control, where the work at the initially agreed workplace cannot be continued, can the employee change that place for another one without the employer’s approval but with mandatory notification of the latter.
While working at home and, unless a specific employment agreement provides otherwise, an employee is obliged to comply with the general working regime of his/her employer.
Working at home does not result in any changes in the working norms or remuneration of labor, and does not affect the employee’s labor rights.
Unless a specific employment agreement provides otherwise, the employer should ensure that its employee has the necessary means, materials and instruments for working at home. And where an employee uses his/her own instruments, he/she is entitled to compensation from his/her employer.
Under the remote work regime, an employee uses information and communication technologies to perform his/her work, choses his/her workplace himself/herself outside the employer’s premises and is himself/herself responsible for ensuring safe working conditions there.
Remote work is not allowed where there is certain dangerous or harmful production or technological factors pertaining to work.
In the case of remote work, an employee allocates his/her working time at his/her own discretion and his/her employer’s internal labor regulations do not apply to that employee, unless a specific employment agreement provides otherwise. At the same time, the total duration of working hours of the employee in question cannot exceed the norms established by the Labor Code of Ukraine.
If agreed between the employee and the employer, the performance of remote work may be combined with the performance of work at the employee’s workplace at the employer’s premises.
If a specific employment agreement does not refer to the rules for provision of necessary equipment, software, hardware, information security and other means to an employee working remotely, the relevant obligation lies with the employer who is also obliged to pay all related costs.
An employee who performs remote work enjoys a guaranteed period of time for rest (period of disconnection), during which time the employee may interrupt any information or telecommunication communication with the employer.
An employee may require the employer to temporarily, for a period of up to two months, establish a remote work regime for that employee if that employee has been discriminated at his/her workplace.
In certain cases (including in case of a threat of an epidemic or a pandemic), flexible working hours, work at home or remote work regimes can be established at the order of the employer. A relevant decision can be taken by the employer also in relation to work at home or remote work in the event of necessity of self-isolation for an employee.
Other Changes to Labor Law
The following should be mentioned as being among other changes to labor legislation related to COVID-19.
Article 26 of the Law of Ukraine On Vacations No. 504/96-BP of 15 November 1996, as amended, provides that unpaid vacation can be provided to an employee for the period agreed with the employer, but for no more than 15 calendar days. However, part two was added to this Article 26 in March 2020, providing that the relevant limitation does not apply to unpaid leave during the period of quarantine. Also, in accordance with Article 25 (3-1) of the same Law, certain persons are now entitled to unpaid vacation, if requested by them, for taking care of a child under the age of 14 for the period of quarantine.
As stated in Article 47 of the Law of Ukraine On Employment of the Population No. 5067-VI of 5 July 2012, employees who lost part of their salary due to quarantine established by the Cabinet of Ministers of Ukraine, are entitled to receive partial unemployment assistance from the state.
Since MPs provided no additional grounds for termination of employment due to quarantine, employers have been using various options for minimizing their expenses in the event of inability to operate fully. These include termination of employees on other grounds (including redundancy) or stoppage, i.e. suspension of work resulting from the lack of organizational or technical conditions required for work, force majeure or other circumstances. In case of stoppage for the period of quarantine established by the Cabinet of Ministers of Ukraine, an employer is obliged to pay to its employees no less than 2/3 of their rates.
Extension of Period for Going to Court
Section XIX of the Labor Code of Ukraine provides that in the event of quarantine established by the Cabinet of Ministers of Ukraine, the periods for filing employment-related claims to courts are extended for the duration of that quarantine.
What the Future Holds
There is no denial that 2020 was a difficult year for the world and Ukraine in particular. Businesses had to adapt to pandemic-related restrictions and challenges, and there was (and still is) huge demand for legal services to properly navigate through all of those and avoid the many risks they created.
Nevertheless, the changes made to labor law during and as a result of 2020 have been really important and long-awaited, as they “legalized” forms of work which have been widespread for a long time. They form, however, only part of continuing labor law reform and 2021 may bring further changes, which could make Ukraine even more attractive as a place with great business opportunities and a professional labor force.