Irregular Economy – Irregular Working Hours

The modern 24/7 style of business requires employers around the world to minimize their business costs and maximize profits by using employees’ labor as intensively as possible. Russian employers are not an exception. One of the possibilities for the Russian employer to reach the above mentioned objective is to engage an employee outside established working hours. The simplest way of work outside established working hours is in the form of overtime. But the simplest way is not one of the cheapest ways. An employee that works overtime is entitled to an hourly remuneration depending on the time worked. Another possibility for the employer to achieve impressive business results at less cost is to apply a regime of irregular working hours.

Irregular working hours constitute a special work regime according to which individual employees may, at the order of the employer if necessary, occasionally be required to fulfill their labor functions outside the working hours established for them.

As can be seen from this legal definition, the law confers on the employer significant discretionary power. What do the terms “individual employees,” “if necessary” and “occasionally” mean? Neither the law nor judicial practice answers this question. Yet is this discretionary power of the employer absolute and unlimited? What are the employer’s risks and how significant are they? What should the employer do to minimize the risk of conflict with employees and how should the employer do this?

An employer applying the irregular hours model always incurs certain risks, which may, for convenience, be divided in two main groups: those deriving from compliance with the procedural requirements of the Labor Code and those deriving from compliance with the general requirements of integrity and respect for human rights laid down by the Labor Code and the Constitution.

The procedure for engaging employees in overtime work consists in establishing a list of positions of employees with irregular working hours in the collective bargaining contract, agreements or a local regulations and issuance of written employer’s order to a particular employee made by authorized persons. Both these documents define the term “individual employees.” The list of positions should be established in consideration of the opinion of the employees’ representative body (trade union). These requirements do not seem difficult to comply with, as long as the employer may insert any position involving irregular working hours in any local regulation on his discretion taking the trade union’s opinion “into account,” which does not necessarily mean to follow it. Nevertheless, the procedure for taking the “opinion into account” is rather complicated and extended. Although trade unions in Russia are not as powerful as they used to be or as they are abroad, they can demand that the employer meet the employees’ interests by appealing to a court or state labor inspectorate.

Unfortunately, compliance with the Labor Code’s requirements does not guarantee the employer against conflicts and employee claims, including in court. According to the law, the only compensation to which an employee working irregular hours is entitled is additional annual paid vacation of at least three calendar days. Irregular working hours is clearly a pattern of work affecting a growing percentage of the workforce and raises fundamental questions about the nature of the work/non-work divide. Many employers demand flexibility, effectiveness and exemplary discipline from their employees without providing any additional benefits. Thus, when imposing an irregular working hours regime, the employer should take into account the general requirements of humanity, integrity and respect for human rights laid down by the Labor Code and the Constitution, such as the right of every employee to fair working conditions; to leisure, including restriction of working time, providing for daily rest, days-off and holidays and prohibition of forced labor.

Compliance with these general requirements is more important and recommended in the event of Russian employee-oriented courts. For instance, legislation does not provide for maximum overtime barrier, but the court may apply the above-mentioned principles or even the similar regulations of overtime work regime to irregular work regime. Hence, an employer issuing an overtime order should take into account the employee’s right to leisure, including daily rest, in order to avoid possible claims and negative court decisions.

Many employers abroad apply different bonuses and compensation models for irregular hours – additional vacation equal to overtime work periods, markups to salary, overtime payments. Some of these measures are adopted by law; others depend on the employers’ goodwill. Irregular working hours affect the company’s image and business reputation, so a company that provides respective benefits and compensation for its employees acquires additional chances to get on to the “best places to work” list. Russian employers’ goodwill practice is not so extensive.

The crisis is compelling employers to improve their business efficiency but, in employing their staff to work, they should not go too far in pursuing business efficiency in order to make their business not only efficient but also humane and consequently defended from employee’s claims. Moreover, a company applying the irregular working hours model humanely acquires additional reputation benefits both within and outside the company.