The best magazine
It is not a secret, that now monetary stimulation of employees plays the important role in formation at them motivations to qualitative and productive work.
In the Russian Federation relations between an employee and an employer concerning an establishment and realization of incentive payments are adjusted by norms of the labor law. In this article we describe basic legal principles and norms concerning incentive payments.
First of all it is necessary to note, that according to the law incentive payments are a part of wages of an employee and are considered at calculation of its average size. In this connection the following principles of the Labor Code of the Russian Federation are extended on incentive payments:
Interdiction of any discrimination at an establishment and change of payments; Establishment of payments depending on qualification of the employee (professional and business qualities), complexities of performed work, quantity and quality of the spent work; Inadmissibility of deterioration of conditions of payments to a concrete employee in comparison with the labor legislation, the collective agreement, the socially-partner agreement and local statutory acts of the employer.
According to The Labor Code of Russia (LC RF) incentive payments include premiums, incentive additional payments and incentive allowance (the clause 129 of the Labor Code of the Russian Federation).
It is appropriate to consider incentive additional payments and incentive allowance as regular payments to an employee in addition to his fixed rate of payment for work. Â Incentive additional payments or incentive allowance are usually established in connection with such circumstances as professional skill, range, experience of work, a scientific degree, an academic status, knowledge of foreign language, performance of work of special complexity or special importance, work with confidential information, holding of more than one appointment, expansion of zones of service, increase in volume of carried out works, a management of a brigade and others.
Premiums basically are understood as additional payments to the fixed rate for work in connection with successful results of work or single monetary encouragements of the employee for its behavior useful to the employer.
If those or other incentive payments are applied by the employer their system should be is established at a level of the given employer (a local level) as a part of system of a payment (the clause 135 of the Labor Code of the Russian Federation). The system of incentive payments applied by a concrete employer can be established by the collective agreement, socially-partner agreements or local statutory acts of the employer according to the labor legislation. Collective agreements and socially-partner agreements are quite rare in Russia nowadays. At the same time the system of incentive payments should be fixed by the appropriate legal document. Therefore employers now possess wide legal opportunities on regulation of systems and conditions of incentive payments to employees by means of acceptance of own local statutory acts (incentive plans, policies and others).
As local statutory acts of the employer contain norms of the labor law, there are obligatory rules, which realization is provided with force of the state (court, labor inspection and other bodies), it is necessary very closely and deliberately concern to preparation and acceptance of such certificates. Thus it is necessary to formulate in detail and precisely conditions and the procedure of this or that payment, a ground of gaining the right to payment, and also cases at which an employee cannot get the given right.
In turn incentive payments to a concrete employee are established by his labor contract according to system of such payments operating at his employer. According to the clause 57 of the Labor Code of the Russian Federation used incentive payments should be at least listed in the labor contract.
Incentive payments entered once can be changed, cancelled or added including under the initiative of the employer. At change of incentive payments under the initiative of the employer corresponding conditions of labor contracts should change with observance by the employer of special procedure which is stipulated by the clause 74 of the Labor Code of the Russian Federation.
The establishment of some incentive payments is obligatory by virtue of the law. For example, addition payment in cases of holding of more than one appointment, expansion of zones of service, increase in volume of carried out works (the clause 151 of the Labor Code of the Russian Federation) are obligatory. Other incentive payments are entered under a discretion of the employer or as agreed by social partners in case of need to generate at employees the certain stimulus in connection with their work.
The tax aspect of legal regulation of incentive payments is worthy first of all in a cut of attitudes on payment by the employer of the profit tax of the organizations (Chapter 25 of the Tax code of Russia (TC RF).
In conformity with the clause 255 TC of the Russian Federation the organization-employer can reduce tax base under the profit tax by the corresponding sums of incentive payments in favor of employees only in case when such incentive payments either are stipulated by the law, or are established by the collective agreement or the labor contract. Also it is one more reason on which incentive payments are useful for listing in the labor contract.
Competent legal registration of incentive payments at a local level and within the limits of the labor contract with a concrete employee does by their effective and reliable means of stimulation of workers to behavior of which is expected from them by the employer.
Author: Aleksander Ksenophontov, Senior Lawyer, LEVINE Bridge Law Firm
Source: ...