With a reduction in staff or the number of employees, it is possible not to wait for a massive reduction, to agree with the employer on the reduction by agreement of the parties. What payments are provided for this scenario?

Reduction by agreement of the parties - pitfalls

Employees must be personally warned about the forthcoming layoff at least two months in advance. The confirmation of the employee's notification will be his signature. If the employee refuses to read the notification, an appropriate act is drawn up.

A seasonal employee must be notified of the upcoming dismissal seven calendar days in advance, and an employee who has entered into a short-term employment contract - three.

The employer draws up a notice of redundancy in any form. It should contain:

• list of positions to be cut;
• the name of the vacant positions offered to the employee;
• the date of the alleged termination of the employment contract.

But is it necessary to wait until the end of the warning period? No. With the written consent of the employee, he can be dismissed before the expiration of the warning period. However, it must be remembered that the employer must also agree with such dismissal.

Since the dismissal of employees is a right and not an obligation of the employer, the employer, if he needs to extend the employment relationship with the employee for the period of notice of redundancy, may not agree with the "early" termination of the employment contract.

At the same time, the employer's refusal to conclude an agreement on termination of the employment contract will not be considered a violation of the employee's rights, since the latter can terminate the employment relationship by writing a letter of resignation of his own free will, having lost, however, the guarantees provided for by labor legislation.

And the employer should not forget that the lack of written consent of the employee, even if there is a verbal agreement, may entail negative consequences for him in the form of the restoration of such an employee in his previous position, payment of wages for the period of forced absence from work, reimbursement of legal costs and payment of compensation for moral damage ...

Dismissal agreement

So, the desire to terminate the employment relationship before the expiration of the warning period and conclude an appropriate agreement may arise from both the employee and the employer. What to do with this desire?

The first step is to inform the other side of the agreement. The employee can state his intention in the application and send it to the employer. The latter, having considered the submitted application, can agree with it or not, in any case informing the employee about the decision he made.

The employer can make a similar offer to the employee orally. But the agreement itself and its terms must necessarily be reflected on paper. This will serve as a guarantee for both parties to the agreement against fraudulent actions of one of them.

If the parties decide to change the terms of the agreement or cancel it, such a decision must also be made in writing. In addition, it must be remembered that it will not be possible to do this unilaterally. To change the terms of the agreement, as well as to conclude it, the will of both parties is required.

Reduction payments

Upon dismissal of any employee, he must be paid the wages he earned and compensation for unused vacation. When employees are dismissed due to layoffs, the employer must pay each of them a severance pay, as well as keep their average monthly earnings for the period of job search.

The job search period paid by the employer must not exceed two months (including severance pay). In exceptional cases, the employer will have to pay for the third month, but only if the employee complies with the conditions established by the Labor Code.

For employees who worked in the Far North, the specified period should not exceed three months, and in exceptional cases it can be extended to six.

What payments can a dismissed employee expect in case of redundancy by agreement of the parties? He is entitled to compensation in the amount of the average salary, calculated in proportion to the time remaining until the end of the warning period.

The average salary is calculated based on the actually accrued salary and the actual hours worked for the year preceding the dismissal. This takes into account all payments related to wages, but does not take into account payments of a social nature or not related to wages.

An employee who has worked for more than one year can count on full compensation for unused vacation, provided that he has 5.5 or more months of work experience during this period, which gives the right to vacation.

And in the end, a small fly in the ointment - workers who are laid off by an individual entrepreneur may not count on all of the above, if their employment contracts do not specify the terms of the notice of dismissal, as well as the size and conditions of payment of severance pay and other compensation payments.

Note that dismissal by agreement of the parties (OPSS) appeared in the Labor Code of the Russian Federation since 2001, and precedents of its use took place since 2002. However, this formulation of the legal basis for dismissal today has the most applicable law practice as a basis for dismissal. Moreover, it is this, frankly, preferred by both personnel officers and heads of commercial companies.

Contract Hire Attribute

Dismissal by agreement of the parties (Article 77 of the Russian Labor Code) is often encountered in connection with the proliferation of contractual employment in the Russian labor market. This form of contractual relationship between employers and staff is an indispensable element of the market system.

Is this leadership in the labor market justified? Is the ease of termination of the employment relationship inherent in this form of dismissal positive: employer-employee? This is a moot point. According to official statistics, the unemployed make up 2-3% of the total working-age population.

These data are objectively underestimated all over the world. The fact is that not all unemployed are registered at the labor exchange for various reasons. Therefore, it is a generally accepted fact that the data of the International Labor Organization are 4-5 times higher than the official statistics on unemployment.

And it is the dismissal by agreement of the parties that is absolutely leading in the termination of labor relations. The peculiarities of this type of dismissal in the conditions of the existence of a labor market are more clearly visible in comparison with other forms of termination of labor relations.

By staff reduction and by agreement of the parties

It is well known that layoffs during staff reductions are a companion of economic crises and their consequences - optimization of the staff structure of an organization. Its legal justification (see paragraph 2 of Article 81 of the Russian Labor Code) is organizationally complex and laborious enough.

The employer is obliged to warn ahead of time the staff that is being laid off in this way and, in addition, to offer candidates for dismissal an alternative full-time position (note that the existing staff is often characterized by a shortage of vacant positions).

He must also identify the staff to whom the law guarantees the pre-emptive right to remain in the state, and exercise it. Therefore, some employers, while optimizing their staff, are trying to substitute “agreement of the parties” for “downsizing”, achieving certain benefits for the company to the detriment of those dismissed.

Clause 1 of Article 77 of the Russian Labor Code offers a less organizationally biased way - dismissal by agreement of the parties. This method of termination of labor relations involves tight deadlines, joint regulation of the dismissal process by the company's management and the employee. At the same time, the administration is not required to comply with the above formalities and the participation of the trade union organization.

At your own request and by agreement of the parties

The absence of a period of compulsory work distinguishes the method we are studying from voluntary dismissal, in which only the employee himself writes the application.

In case of voluntary dismissal (OPSG), such a statement is drawn up fourteen days before the agreed date of leaving work. During the aforementioned two weeks, the employee continues to carry out his previous job duties. He is also entitled to take leave for this period. However, even if the employee is on sick leave, the 14-day period will not be considered interrupted.

Dismissal by agreement of the parties has been significantly simplified in relation to the UPA. First of all, the difference lies in the absence of a two-week period of work - until the date of dismissal. The date of leaving work is negotiable; the director also negotiates with the dismissed employee by mutual agreement some additional conditions. The employment relationship can be interrupted on an agreed and agreed date in advance, even if the employee is on vacation or on sick leave.

Legal differences between the two types of layoffs

Dismissal by agreement of the parties involves the procedure for terminating the employment contract between the employer and the employee in accordance with Article 78 of the Russian Labor Code. Employers most often use it in cases of labor violations on the part of employees (absenteeism, appearance at the workplace in a state of intoxication, failure to fulfill official duties). However, even more often this dismissal is initiated by the employees themselves. It, as you have noticed, has similarities to being fired at will. However, there are some differences (see table 1)

Table 1. Comparative characteristics of UPSS and UPSZ

When analyzing the information contained in the above table, pay attention to the detail: it is impossible to dispute the dismissal by agreement of the parties unilaterally (as opposed to the UPS). It was adopted jointly under the OPSS, and therefore ceases to operate by mutual agreement.

At the request of one of the parties, the dismissal cannot be prevented. However, if it was carried out under the coercion of the employer, then it can be challenged in court. In this case, the employee is reinstated in his previous position with the payment of average earnings for forced absenteeism.

Payment of compensation

If there is a dismissal by agreement of the parties, compensation for the unused vacation must be paid to the employee. In addition to it, he is obligatorily paid the accrued wages for the current month on the last day of work, as well as bonuses taken into account in the organization's wages, various bonuses (for length of service, qualifications). Then the employee receives a work book and a certificate of average monthly salary.

However, not only compulsory payments promise an employee dismissal by agreement of the parties. Compensation in the amount of one salary is often negotiated by the employer in the orders for the organization.

Legislation does not establish a specific framework for such payments, therefore, a contractual amount of additional compensation may be established in the agreement between the employer and the employee.

It is no secret that this type of dismissal is more beneficial to the employer than to the employee. The motivation is well known: the employee cannot independently withdraw the written statement, and the trade union, in turn, also cannot influence this process in any way.

Therefore, an employee who has chosen to be fired by agreement of the parties, compensation must necessarily be considered as a section of the contract with the employer. Federal Law No. 330-FZ of November 21, 2011 established the procedure for taxing personal income tax compensation. In accordance with paragraph 8 of clause 3 of article 217 of the Russian Tax Code, compensation not exceeding three employee's salaries is exempted from taxation.

Article 178 of the Labor Code regulates the payment of such severance pay. According to it, provisions for its payment can be included in the collective agreement. The second option for the regulation of such compensation is stipulated directly in the documents that accompany a specific dismissal by agreement of the parties. At the same time, personal income tax, in accordance with clause 3 of Article 217 of the Tax Code of the Russian Federation, was not levied on severance pay not exceeding three salaries, and for the regions of the Far North - six salaries.

Dismissal registration

The current practice of formalizing such a dismissal does not provide for any standard documents. However, the preferred design option remains an agreement drawn up jointly by the employee and the employer. An indication of the desired legal consequences of the termination of labor relations as a result of mutual agreement of the parties, the indication of the date is accompanied by dismissal by agreement of the parties. The payment of the severance pay, the timing of the transfer of cases and positions to a new employee are also negotiated. Let's present an example of the above agreement.

Agreement on termination of an employment contract

The employer - LLC "Alpha-Trade" represented by the director Pavlov Konstantin Borisovich, acting on the basis of the charter, and the employee - merchandiser Selezneva Marina Viktorovna came to an agreement that:

1. The employment contract dated 21.02.2010 N 35 will be terminated by agreement of the parties.
2. The employment contract is terminated on July 20, 2014.
3. The employee is paid compensation in the amount of one official salary.

The agreement is made in 2 copies with equal legal force, 1 for each party.

Director Seal Pavlov Konstantin Borisovich

Employee Marina Selezneva

Dismissal initiator - employee

However, the proposed method of registration can often be preceded by the writing of a statement by the employee or a corresponding appeal from the administration to him. At the same time, there is no single model of how to write a letter of resignation by agreement of the parties. Therefore, we will present an example of such a document.

Sample employee statement

Director of LLC "Alfa-Trade"

Pavlov Konstantin Borisovich

Statement

I ask for your consent to terminate the employment contract with me from July 20, 2014, respectively, paragraph 1 of Art. 77 of the Labor Code (reason - by agreement of the parties).

I consider it expedient to establish a severance pay in the amount of two salaries.

Pending written consent from you, I reserve the right to withdraw this statement at any time.

Seleznev's merchandiser

Marina Viktorovna.

The agreement, as an option, may also be preceded by an appeal from the administration initiating dismissal by agreement of the parties. Sample text is similar to that provided in the application.

Administration letter

Dear Marina Viktorovna!

We offer you to terminate the employment contract, guided by clause 1 of Art. 77 of the Labor Code (i.e. by agreement of the parties) from July 20, 2014.

The compensation is set, according to the collective agreement, in the amount of two salaries.

Director

Pavlov K.B.

Execution of an order for dismissal

Based on the agreement, the head of the organization signs the corresponding order. Dismissal by agreement of the parties is gaining legal force at this point. Often, along with this order, an order is issued on the acceptance and transfer of cases and an inventory.

LLC "Alfa-Trade"

07/20/2014 No. 15-k

Moscow city

About the dismissal of Selezneva M.V.

FIRE:
Marina Viktorovna Selezneva, merchandiser, 07/20/2014 by agreement of the parties (Article 37 of the Labor Code).

The accounting department shall pay to MV Selezneva monetary compensation in the amount of three salaries.

Reason: statement by M.V Selezneva dated 07/15/2014.

Director of LLC "Alfa-Trade" Pavlov K.B.

Selezneva M.V. is familiar with the order and agrees.

By means of such an order, dismissal is carried out by agreement of the parties. In this case, the entry in the work book must necessarily mention paragraphs 1 of part 1 of article 77 of the Labor Code.

Should one avoid the phrase "dismissal by agreement of the parties when dismissing?"

This question is, of course, controversial and related to myths.

Myth No. 1: An employee who is dismissed by agreement of the parties is a violation of labor discipline.

Myth No. 2: An employee who terminates employment in this way is not qualified.

The reason for the emergence of these prejudices was the practice of employers to “lay off” negligent employees under Article 77 of the Labor Code. However, if the employee is confident in his qualifications, as well as in the fact that he will be immediately employed elsewhere, then these myths are insignificant. On the contrary, a person will be able to quickly get the expected job.

Output

Is OPSS in its current form ideal as a labor market tool? Based on macroeconomic laws, its parameters (for example, non-participation of trade unions in its process) are incorrect at a significant level of unemployment.

For such a market mechanism to function fully in the labor market, ideally, a growing economy and a sufficient level of supply of competitive jobs are needed. However, the simplified organizational aspects accompanying the UPSS are in many cases preferable for the prompt termination of labor relations. This factor determines its widespread use.

A person dismissed by agreement of the parties should take into account that in some cases an incorrectly executed agreement and, accordingly, an order of dismissal by agreement of the parties may ignore the payments or benefits due to him. Therefore, everything should be foreseen and taken into account.

Problem

Hello! once again (and probably the last time on the labor issue). A question of this nature: today I wrote a letter of resignation by agreement of the parties (in connection with the staff loss). I am interested in this moment: how is the accrual of settlement funds (for two months)? Are they subject to income tax? Why? From the actually earned wages (from which I have already paid), or from the amount of accruals? I have to pay on average when calculating?! And how can they keep from this "average" what has already been withheld ?! Or they will calculate the accruals for the last year (general, that is, those that were charged in general) and they will be deducted from them ?! or will be kept from the "clean" (those who received their hands in the form of a salary) ??? But I also paid with them !!! Explain, please! Yes, sorry, I CONGRATULATE YOU ON MAY HOLIDAYS and I WISH YOU PATIENCE AND SUCCESS IN YOUR LITTLE WORK !!! Sincerely! Sasha

• Letter from the FMS on taxes on severance pay to employees.doc

Solution

Hello Anna!

Well, if you do not understand that you will be paid when signing the documents for dismissal by agreement of the parties, then you will first get out of parental leave.

And then discuss all payments, the only thing I can say for sure is that compensation for not taking leave of absence must be paid, both upon dismissal for redundancy, and upon dismissal by agreement of the parties.

And yet, look from a different angle at this situation, that many employers who are dismissed on layoffs look at the fact that the most unnecessary, not promising, unnecessary workers are being dismissed.

Although, dismissal on reduction in payments is more profitable, but it's up to you to decide. But who is stopping you from discussing these payments even when dismissing by agreement of the parties, and not just negotiating, but so that the components of all payments are fully prescribed in the agreement on termination of the employment contract:

1. Compensation for unused vacation

2. Severance pay

3. For the period worked until the day of dismissal (if you will work for some period after leaving the parental leave).

Do you have any questions? Ask, the answer will follow immediately!

A number of employers offer employees select between dismissal to reduce and dismissal by agreement of the parties... But the employee always has doubts about how open and honest the employer is in this proposal. Is there a catch in it? Let's take a closer look at both forms of termination.

Reduction of the number and staff of employees

Reduction of the number and staff of employees is usually applied in cases where the business or its individual areas are not in the best economic situation, then there is a need to optimize the number of employees. Labor legislation prescribes in such a situation strict observance of the rights of certain categories of employees, as well as strict adherence to the timing and sequence of the procedure for warning of redundancies and the dismissal itself. Let us dwell in more detail on the procedure for dismissal for redundancy. First of all, before the start of the layoff procedure, employees who are not subject to layoff (single mothers, pregnant women and others) should be identified, and the priority right to be left at work should be taken into account.

That is, if an employee has a higher qualification, has two or more dependents, and in a number of other cases, then he has more rights to continue working than other employees. The company must notify the employee about the layoff no later than two months before the expected date of dismissal, and also inform the employee in writing about the available vacancies. If the dismissal of an employee cannot be avoided (there are no vacant positions in the company, the employee does not belong to the “privileged” group), then upon dismissal the company is obliged to pay him severance pay. If the employee does not find a job, then the right to receive benefits in the amount of the average monthly salary remains with him during the second and third months from the date of dismissal (provided that he is registered at the state employment center). Thus, potentially, the employee has the opportunity to maintain approximately the same level of income for five months (from the date of the warning about the reduction and until the end of the third month from the date of dismissal). This is especially important for those who are not in great demand in the labor market for various reasons.

Dismissal by agreement of the parties

Dismissal by agreement of the parties is a rather flexible form of separation of the company from its employees, which can be used in different situations. It does not imply strict requirements for document flow and terms of notice of dismissal. This form of dismissal is chosen when it is difficult to part with an employee for other reasons. It is legitimately used by companies as an alternative to layoffs for layoffs, since the compensation package can include payments comparable to those for layoffs, and sometimes even large ones. Often, those who are confident that they will quickly find a job are inclined to this form of dismissal, they want to receive the amount of compensation immediately and be free to look for a new job.

But often this form of dismissal is used by the employer as a way to put pressure on the employee: they want to leave the employee, they do not want to provide other work, and payments upon dismissal are offered scanty or are not offered at all. In this situation, it should be remembered that dismissal by agreement of the parties is the result of mutual agreements, but if the conditions are not satisfactory, you should not agree to dismissal.

Let's analyze a specific example of a client contacting our lawyers, who is faced with the need to choose a form of dismissal:

I hold the position of Senior Research Fellow at a Research Institute. The project, on which we have been working for five years, is being closed, our department is being disbanded. At the meeting it was announced that they would not be able to employ us at the institute, although there are rumors about the opening of new projects. They said that most of the employees in our department will be fired either by agreement of the parties with the payment of three salaries, or by reduction (they suggest choosing). Is it legal? Are my rights being violated?

At first glance, there is nothing illegal in the offer of our client's employer: there is no pressure on him, he is offered to choose between similar compensation packages. But since our client is the only senior researcher in the department (all other junior researchers), he has a pre-emptive right to be left at work, in addition, if he chooses an agreement of the parties, he will lose the right to get a vacant position in a new project, if one appears. ... If you are faced with a similar situation, you can contact our lawyers. We will help you make the right choice!

Today, enterprises sometimes have to resort to such a method of dismissal as layoffs, and in this regard, the question often arises of how best to quit, if there is an opportunity to choose, by agreement of the parties or by layoff. Each of these options has its own advantages and disadvantages, which determine the choice of an employee when leaving the company. They also have some important differences that can play a decisive role in dismissal. Today we will talk about when people quit, which option is better, by reduction or by agreement of the parties. What payments are provided for the contracted party?

The main differences

Despite the fact that any dismissal is associated with the departure of a person from the enterprise, various methods determine the characteristics and final conditions. When there is a dismissal by agreement of the parties, then an appropriate mark is made in the documents, which many citizens do not want to receive. The problem lies in the ambiguous interpretation of the concept, since someone may think that a person left at will, but for others, such an explanation would mean that he was asked to leave. Given this fact, many people refuse to agree to layoffs, leaving as part of the layoff. In this case, a note will be made in the work book.

Important! Practice shows that dismissal by agreement of the parties is not a disadvantage for an employee. This option means that the employer and the employee have agreed, and therefore the care will be carried out on conditions that suit everyone.

If we are talking about the procedure for issuing a dismissal, then they are radically different. In the case when the employer decides to cut, he must go through several stages that take a lot of time. So, to begin with, he must send a message to all persons whose reduction is planned. This must be done 60 days before the date of dismissal. It is also necessary to select the available vacant positions in the enterprise and offer them to employees as an alternative to leaving. In case of refusal, it is necessary to issue papers by paying compensation. The withdrawal procedure by agreement of the parties does not require a two-month warning, and any workers, including pregnant women and retirees, can be fired.

The reduction means that a person leaves by decision of the management in the manner prescribed by the Labor Code. In this case, the position held should be abolished, and the services of the abbreviated person are no longer needed. If everything happens like this, then the dismissal will be legal. Otherwise, the person can file a claim in court and demand from the employer to return the job and pay compensation for the lost time.

Read also The procedure for dismissing the maternity in connection with the liquidation of the enterprise

For this reason, if a company needs to cut some of its employees, they can offer them to terminate the contract by agreement of the parties on very favorable terms. All that is required of the employer is to fulfill the conditions and issue the papers on time, issuing salaries and other payments. It is impossible to say that both options are good, but leaving by agreement of the parties is simpler and faster, and therefore preference is given to him.

Reduction features

Reduction of employees can be resorted to in several cases. As a rule, this is due to the deterioration of the economic situation and a drop in the level of production at the enterprise. As a result, incomes decrease, and it is no longer possible to support such a number of people. Sometimes the opposite happens when new equipment is purchased that requires fewer people to maintain. Be that as it may, downsizing is a compulsory measure.

This is not an easy situation for an employer, as some people may strongly oppose such a decision. Moreover, for certain employees, the application of the abbreviation is prohibited. So, this applies to mothers raising a child on their own, pregnant women and other categories of citizens. To fire them, you need to negotiate separately or leave them in the workplace, offering them another position. In any case, this is associated with certain difficulties.

Among other things, the company is obliged to strictly follow the procedure for the reduction of staff. If at least some kind of violation is committed, then the employee has the right to challenge the decision and receive compensation. For example, if the notification was not sent on time or the reduction can be avoided by assigning the person to a different position.

If we talk about the advantages, then for the enterprise they consist in the fact that most of the employees can be fired without their consent, if there is a clear reason for this. Moreover, the compensation paid will lead to a decrease in the tax base, which means that less money can be transferred to the budget.

As for the shortcomings, they are also available. Firstly, it is the complexity and duration of the procedure. Secondly, the reduction requires compulsory accrual of benefits. Third, some employees may try to challenge the decision in the event of the slightest violation.

Read also Features of registration at the labor exchange upon dismissal of their own free will

For people, reduction care has certain advantages, among which are:

• receiving cash payments;
• the availability of time to search for a new place of employment, including within the framework of the current company;
• the impossibility of dismissing some of the categories that we mentioned earlier.

At the same time, there are disadvantages, because if a new position at the enterprise is not found, then you will have to look for another job. Also, the reduction requires an employee to work in 2 months, which can also be a minus.

Features of care by agreement of the parties

Leaving by agreement of the parties is very simple, we have already managed to find out. As for the main advantages, here you can highlight the following nuances:

• registration at the labor exchange after dismissal on this basis will allow the employee to receive payments for a longer time and in a larger amount;
• leaving the enterprise can be formalized in a matter of days, since the employee is not obliged to work out the two weeks established by law;
• termination of the contract by agreement of the parties is possible at any time, and there is no need to wait for its expiration;
• payments from the enterprise are generally higher than in the case of layoffs.

As we can see, quitting by agreement with an employer can be very beneficial, especially if the company is interested and can offer excellent conditions. Nevertheless, this option of leaving also has its drawbacks, among which are:

• lack of control;
• no compulsory payments.

Since the contract is terminated by agreement of the parties, trade unions and other organizations practically do not participate in any way and cannot influence the dismissal process. Moreover, this applies even to those cases when a pregnant employee or a woman with a small child quits. Whichever category a person belongs to, government bodies will be very limited in their influence on the employer and on the process as a whole. The conditions of care will be exactly the same as indicated in the agreement of the parties.

From the last point it follows that the employer is not obliged to pay anything to the dismissed employee. Of course, payments are provided in most cases, but their size can be anything. What conditions of care a person agrees on, he will receive such compensation. In some cases, the amount of payments by agreement of the parties is provided for by the labor agreement. However, remember that if the contract provides for large payments to the employee, then the employer may try to avoid this obligation and fire the employee in another way.