22.05.2000 | I. Nesterenko, Kharkiv

Struggle with pay arrears


Since 1998, when pay arrears in Kharkiv oblast became systematic, the courts received a great number of claims to get the due pay.

According to Article 47 of the Labor Code, the employer must give the labor book to an employee dismissed on the day of the dismissal and pay the dismissed employee’s all wages on the day mentioned in Article 116 of the Labor Code. This article stipulates that all the pay must be given on the very day of dismissal.

The same term is required by Article 12 of the Convention No. 95 of the International Labor Organization.

In this connection a number of questions appear which are not resolved or incorrectly resolved in the court practice.

First of all, when a dismissed employee, having got no money, turns to court and the court decides that the money must be paid, this court decision is not executed for months. Theoretically, this question is solved simply: ten days after the court decision the act of execution is directed to the state execution service of the same district. After this the state bailiff, in case when the employer has no money on his account, has the duty to distrain upon the employer’s property for selling it from the auction and pay the debt to the claimant. The form of property is immaterial in this case. If the state bailiff refuses to order the sale of the employer’s property, the plaintiff hands the complaint to the court.

In actual practice in the Kharkiv oblast another way appeared more efficient: turning to the oblast Directorate of justice, although this way is not mentioned in the law.

Other legal questions concerning compensations to employees are solved with more fantasy. Article 117 of the Labor Code considers the question of how the employer must be punished for the untimely payment of wages. The article stipulates that, beside paying the wages, for the delay the employer must pay the average wages for the delay duration. This clause is quite unambiguous, but court decisions are very diverse. What unites such decisions is that every approach impinges the employees rights. Some courts recover the average wages if the employee has been taken on account in the Employment Center, otherwise only the minimal wages are recovered.

Other courts accepted at first the complaint on recovering pay arrears and only after the decision to recover the due wages accepted the complaint on recovering the compensation for the delay. Still other courts refuse to accept such complaints referring to the fact that labor books were given in time, although another article of the Labor Code considers how to solve this problem. Recently the courts have been instructed to recover the average pay for the delay of payment if the employee complained within three months. This instruction is based on the clause that in labor disagreements the claims must be handed within three months. This is a very tricky instruction, because, as a rule, the dismissed employees do not hand the claims to court, because the employer promises to pay the money from day to day.

At last, pay arrears inflict great moral damage, make many families to starve, cause stresses and become reasons for divorces and suicides. Yet, claiming compensation for moral damage because of pay arrears are not accepted by courts on the basis of Article 440-1 of the Civil Code of Ukraine.

We must only hope that the Supreme Rada of Ukraine will adopt new laws about the very actual problem of pay arrears.

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