Amendments to the Russian Labor Code (Federal Law No. 144-FZ dated June 7, 2025) will take effect on September 1, 2025. These amendments will clarify the requirements for employers’ local policies and procedures regarding bonus payments to employees. These changes aim to eliminate arbitrary reductions in employee payments and align the provisions of the Russian Labor Code with the position of the Russian Constitutional Court.[1]

These are the key innovations:

The types of bonuses, their amounts, the time limits, grounds, and conditions for paying bonuses to employees are to be determined by the employer’s local policies and procedures.
When establishing a bonus system, quality, efficiency, and duration of work, as well as whether an employee is subject to any disciplinary sanction, are to be taken into account.
A bonus may be reduced if the reduction is related to a disciplinary sanction and applies to the accrued bonus for the period (g., the month), in which the sanction was applied. The reduction cannot decrease the employee’s monthly earnings by more than 20%.

When a company is liquidated, the employer is obligated to pay the dismissed employees their average monthly earnings for the period during which they are looking for a new job. However, in practice, it is often the case that the right to such payment does not arise until after the completion of the liquidation process.

Several years ago, the Russian Constitutional Court highlighted this issue, and amendments were even introduced to the Russian Labor Code. Yet the core problem remains: by the time the right to payment arises, the legal entity will have ceased to exist. As a result, the employee—or, in some cases, the prosecutor’s office—will file a lawsuit to recover the unpaid amounts, and courts will typically rule in their favor.

This creates potential liabilities for the company, the liquidator, and the founders. To avoid such situations, it would be advisable to make provisions for possible payments already in the liquidation phase.

To read the full article, click here (in Russian).

The Russian Constitutional Court heard a case[1] of an employee who had been dismissed from his principal place of work due to redundancy. The employer paid the employee a severance allowance, but refused to pay the employee’s average monthly earnings for the period of finding a new job [2]. The employer believed that the employee was a dual job holder and, therefore, such an employee was not entitled to a guarantee in the form of payment of his average monthly earnings. The courts sided with the employer in a dispute with the employee.

We would like to inform you that the draft law increasing fines for employers for failure to perform military registration duties has been adopted in the form that we discussed in our previous alert and will take effect October 1, 2023.

The Russian State Duma is now considering amendments to the Russian Code of Administrative Offenses. The amendments provide for a significant increase in the fines for failure to perform the military registration duties.

Last Tuesday, July 12, the St. Petersburg International Business Association (SPIBA) hosted an event titled “Employment Relationship in Times of Uncertainty—Relocation, Dismissals, and Changes to Employment Agreements”.

Mika told members of the FRCC about the options that companies might use today to adjust the cost of labor in Russia.

Numerous legislative changes usually enter into force at the beginning of the year, and 2022 was no exception. We have outlined in this review the main changes in the regulations that will become effective in 2022.

The Russian legislation regulating electronic document management (EDM) is being changed and improved to better serve labor relations.

On October 12, 2021, St. Petersburg Chief State Sanitary Doctor adopted Order which affects a significant number of entities operating in St. Petersburg.