Thus, 27 cases dealt with challenging fines for non-accrual and non-payment of wages for overtime work, for employee’s failure to serve the two-week period, for failure to enter into a written employment contract, as well as challenging fines for failure to pay the minimum wages, violation of the inspection procedure, etc.
Fines for non-accrual and non-payment of wages for overtime work
In particular, in one of the suits, a legal entity challenged the penalty for non-accrual and non-payment of wages for overtime work. As the complainant said, after the State Labor Administration inspected him last April, the company got fined for UAH 297 thousand. At the same time, the complainant insisted that there were no reasons for imposing a fine under Articles 79, 106, 115 of the Labor Code of Ukraine.
“Instead, in the inspection visit act, on the basis of which the challenged resolution was issued, there was only registered the violation by the complainant of the requirements of Article 116 of the Labor Code of Ukraine while accruing and paying wages for overtime hours for 2017, which were paid on January 5, 2018 (not on the day of dismissal),” the case file mentioned.
However, given that the complainant did not carry out monthly payment for overtime hours, as well as failed to timely settle up with the employee upon his separation from service, the court concluded that the recorded violations incur liability to pay triple minimum wages, not tenfold ones, as the State Labor Administration demanded. The court found the decision of the State Labor Administration illegitimate.
Termination of an employment contract upon the employee’s request without serving the two-week period
Another illegal fine from the inspection entrepreneurs consider as well sanctions for the termination of an employment contract upon the employee’s request without his/her serving the two-week period. The application of the established term of serving is the employer’s right, but not the duty.
In this case, the lawyers recommend the employer to ensure that the work performed by the employee and the accounting for labor costs are accurately recorded according to the established procedure.
Failure to enter into a written employment contract
Among the cases the lawyers dealt with, 8 cases concerned challenging the inspection’s fine for failure to enter into a written employment contract. Most of them were resolved in favor of the complainant company.
The findings of the inspections were based on the inspectors’ assumptions and were not supported by proper and admissible evidence. For the complainant and those who performed the relevant works had actually entered into a civil contract.
As the lawyers note, the main difference between contractual (civil) relationships and labor ones is that the labor law governs the process of labor activity, its organization. While under the civil contract, the labor activity organization process is beyond it, for the contract’s purpose is obtaining a certain material result. A contractor, unlike an employee, does not obey the rules of internal labor regulations, organizes his/her work himself/herself, and performs it at his/her own risk.
In practice of the Rezultat law firm, one of the inspections of the State Labor Administration was declared illegal by the district administrative court. Since at the time of the inspection, the enterprise head was on a business trip, and the enterprise registration address was incorrectly indicated in the inspection documents.
At the same time, the court abolished the order to fine the enterprise for violating labor laws, namely, for failure to inform the State Fiscal Service territorial body on the recruitment of employees. For that information was included in the periodic reports that were rendered to the SFS territorial body for the timely accrual and payment of the unified social tax amounts on the sizes of accrued and paid amounts of wages.
Practical training at the enterprises
The complainants also won the cases concerning challenging the Administration’s fines for violation of practical training procedure.
The fine for almost half a million hryvnias was successfully challenged due to an unsubstantiated and groundless inspectors’ conclusion. According to them, the company had not signed contracts with practitioners. However, the current legislation of Ukraine does not stipulate signing of labor contracts with persons who “pass the curricular practical training at the employer’s place in accordance with the agreements on curricular practical training entered into with vocational-technical schools.” There were such agreements between the educational institution and the complainant entrepreneur.
The Rezultat lawyers emphasize that when registering interns in the workplace it is necessary to have a referral for practical training, which is issued by the educational institution.