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Raiders in the Ranks of Trade Unions: How shall the Directors Keep their Rational Mind and Reputation

Date of publication: 9 October 2018

Valeriia Gudiy, Lawyer

Source: NV

The law provides for some kind of immunity of the trade unions, ie certain inviolability and independence from anyone: from state bodies and local self-government authorities, employers, other non-governmental organizations and political parties. The Law on Trade Unions, their Rights and Guarantees of Activity (hereinafter – the Law) expressly provides that interference with the statutory activities of the trade unions, their organizations and associations is prohibited. It envisages a good scope of activities that only a few people may guess about, and even less may speak of aloud.

Financial side of the matter

Pursuant to the Law, trade unions conduct their activities at different levels, namely, at primary, local, oblast, regional, republican and all-Ukrainian.

Primary trade union organizations mainly operate within the same enterprise. Such trade union may be established as an independent entity or as a separate unit within the all-Ukrainian trade union giant. Any citizen of Ukraine can establish a primary trade union when ‘feeling a desire to protect labor, social and economic rights and interests of their colleagues’.

Of course, some may not have a real desire to ‘protect labor, social and economic rights and interests of their colleagues’, but they may still establish a trade union and start collecting membership fees.
The amount of membership fees is determined by the trade union alone or by the superior trade union organization. The more members the union has, the more membership fees it receives. In addition, the trade union can receive donations from citizens and enterprises. The employer also participates: pursuant to the Law the employer is obliged to deduct not less than 0.3% of the wages fund to the primary trade union organizations for ‘culture-into-masses, sports and recreational work’. The collective agreements may envisage larger amounts of deductions.

What does it mean?

For instance, an enterprise with 50 employees having a minimum wage of 7 000 hryvnias per month pays a minimum of 12 600 hryvnias a year to the trade union. But the company employing 1 000 people with the same salary of 7 000 hryvnias pays to the trade union a minimum of 252 000 hryvnias. Under the same conditions the enterprise having 10 000 employees pays to the trade union at least 2 million 520 thousand hryvnias. And since trade unions are non-profit organizations, basically, they are not taxpayers. Hence, having received the money, they may dispose of such money at their own discretion (of course, within the framework of legitimate trade union activities), after all, no one will actually check – except for their own audit bodies.

This makes large enterprises an attractive object for raidership.

Quit the job, turn to the trade union

The Law provides trade unions and members of their elected bodies with special rights and guarantees for the protection of their activities. However, it is possible to exercise such special rights and guarantees in a slightly different way.

For instance, the termination by the employer of labor relations with an employee elected to the elected body of a trade union – even though there are legitimate reasons for the above – may lead to disastrous results.

Such an employee, a member of the trade union’s elected body, may be dismissed, however, it is highly likely that the court will decide to reinstate the employee in a former position, and the employer will suffer not only material damage, but also a loss of reputation. Moreover, after the court decision enters into force, trade union bodies have the right to demand termination of an employment contract with the enterprise director, upon which the order for dismissal is signed for the alleged violation of labor legislation and legislation on collective agreements.

Even if the company director does not ‘violate the law’, the trade union body may still demand his/her dismissal from the owner. If there is no reason for the above – it can be invented or concocted, for example, by taking advantage of the lack of actual familiarization of the company lawyer with the activities conducted by the trade unions.

In the process of dispute consideration and struggle for his/her place, the enterprise director will forget, at which stage he/she failed to protect his/her interests and interests of the company he/she manages. The trade union will be on the high horse, disseminating information about violations of the workers’ rights and raising its rating among other employees.

The Law also offers certain advantages for the average members of trade unions who are not members of the elected bodies. For example, it may be difficult for the employer to terminate employment relationships with the employee, who is a member of a trade union, without direct consent of such trade union.

For instance, the employee was absent from work, the employer can confirm the fact of absenteeism, and the employee is a member of a trade union. The employer submits information to the trade union with the documents collected and a request to allow the offender to be dismissed, and receives a ‘no’ answer. The trade union justifies its ‘no’ quite simply and concisely: ‘This dismissal is contrary to labor law’.
The further scheme is rather simple: the employee, who was allegedly unreasonably dismissed, appeals to the court to protect his/her ‘violated’ rights, the trade union advocates for his/her interests, and the court often makes a decision in favor of such an employee – restores the dismissed in position and rules to pay him/her the average salary due to him/her for the entire period of the forced absenteeism. The employer once again bears material and reputational losses.

Be careful

The Unified State Register of Court Judgments contains a Resolution of the Supreme Court dated 01.02.2018 in the case No. 501/2511/15-ц, which upholds the conclusions of the cassation court previously delivered, –

“... the courts shall determine whether the decision of the trade union body to refuse the termination of the employment contract contains the reasons for such a refusal, while not assessing the relevancy of the decision itself…”.

Trade unions may easily manipulate the aforementioned position of the court. In the example above, the trade union will take a position that it has substantiated its refusal, and the court has no right to go into the essence of the reasonableness of the refusal. The decision delivered by the court in a particular case depends, among other things, on the qualification of lawyers involved by the employer to represent the interests of the enterprise.

Personally, I recommend that employers be extremely careful in dealing with trade unions, more specifically, legally careful. After all, the persons who impede the exercising of the right of citizens to unite in the trade unions, as well as officials and other persons guilty of violating the legislation on trade unions, who, by their actions or omissions, impede the legal activity of trade unions or their associations, bear disciplinary, administrative or criminal responsibility.

The deliberate interference with the legitimate activities of trade unions or their bodies is punishable by corrective labor for a term up to two years or imprisonment for a term up to three years with deprivation of the right to occupy certain positions or engage in certain activities for a term up to three years.

This material is not based on the activities of any particular employing organization or trade union. The author in no way intends to blame or denounce anyone in any way, but rather simply expresses her thoughts on the effective legislation of Ukraine, the application of legislation in practice and the opportunities arising for one side or another within the framework of the employer-trade union relationships.