Employment books: what has changed starting from January 1
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Employment books: what has changed starting from January 1

Employment books: what has changed starting from January 1

PUBLICATIONS \ 26.03.2021

Starting from January 1, 2020, electronic employment books (EEB) have been introduced in Russia. By the way, the term “electronic employment book” is a philistine usage. The law employs the wording of Employment History, according to the name of the monthly report that the employer submits to the Pension Fund of Russia (PFR). The transition to the new format of the document is voluntary in nature and occurs if desired by the employee, except for those who will be employed for the first time starting from January 2021. For them, no such choice is provided for.

During 2020, employers set up and adjusted existing business processes in order to implement full-fledged maintenance of electronic employment books starting from January 1, 2021. Nevertheless, HR specialists will have to deal with paper employment books for a long time. This will happen because provision has been made for employees to choose the format for continuing to keep records of their labour activities, and a certain number of employees will choose paper form.

Electronic employment books could cause irrelevant labour costs to business, which is especially important for large companies with a large staff. In addition, the maintenance of EEB should minimize the loss of information about the length of employment; stories of cases when, owing to the liquidation or reorganization of companies, an employee cannot confirm their length of employment will be a thing of the past. Despite this, not everyone would like to switch to the electronic format of employment history. Unfortunately, there is low awareness, as well as a low level of users’ trust, in digital systems, both on the part of employees and employers. Doubts have been raised about the correctness and completeness of the transfer of information to the electronic format, as well as about the likelihood of information being lost as a result of hacker attacks and the level of protection of personal data.

WHAT ARE THE ADVANTAGES OF SWITCHING TO AN ELECTRONIC EMPLOYMENT BOOK FOR AN EMPLOYEE?

  • All information about labour activities will be available at any time in the user’s personal account on the websites of state services (www.gosuslugi.ru) and of the Pension Fund (pfr.gov.ru). It is possible to quickly obtain an extract about labour activities. Now it is possible to obtain an extract from the Multifunctional Public Services Center (MPSC) or the PFR without reference to the place of residence or work, which is especially convenient for remote work.
  • It enhances the prospects of remote employment.
  • In the future, it will be possible to have a pension issued remotely based on the data uploaded to the system, without the exhausting need to collect additional documents. The same applies to receiving other social benefits.

WHY ARE EMPLOYERS INTERESTED IN TRANSFERRING EMPLOYEES TO ELECTRONIC EMPLOYMENT BOOKS?

  • The employer is not responsible for storing the employment book. After the employee has decided to transfer to employment history in electronic form, the employer is obliged to return to him or her the employment book on paper with the corresponding entry. The employee, in turn, signs to acknowledge receipt in “The book recording the flow of employment books and inserts in them”. From this point on, the responsibility for storing the paper book lies with the employee.
  • The employee’s work history becomes transparent to the employer. The electronic recording system does not allow the employee to “turn his or her life around”. The employer will see all previous places of work, as well as the reasons for the termination of the Labour Contract. It will not be possible to “lose” or start a second or even a third employment book if, for some reason, the employee is not satisfied with the entries. A side effect will be an increase in the number of labour disputes. Also, it will not be possible to hide work in the civil service or as a second job, which could be important for the employer owing to the obligations that are imposed on him or her by law.
  • It is not necessary to buy any more forms and keep them in reserve. It also eliminates the need to create extra papers to make a deduction of the cost of the form from the employee’s salary.
  • In the future, the transition to EEB will allow document flow to be reduced and simplified.

However, with all the advantages of switching to electronic employment books, it is important to note and take into account the following:

  • The information systems have no information (or they are incomplete) about the length of employment before 2020. This means that the employee will have to ensure that the paper employment book is safely kept. By the way, if the paper form is lost after it has been returned to the employee, the employer is relieved of the obligation to restore it if it is lost.
  • An employee can switch to an electronic employment book at any time, but there is no return path.
  • The reporting submitted to the PFR does not provide for a section on awards received, which is present in the employment book on paper. This information may be important, for example, for obtaining the title of a Veteran of Labour. Should an employee switch to an electronic employment book, he or she will have to confirm the receipt of awards with other documents.
  • Absolutely all information will be included in the electronic employment book. If in paper form, an entry about employment was made if an employee had worked in the organization for more than five days, but in the electronic system, according to the current rules, the data is entered not later than the working day following the day when the relevant order for employment or other documents confirming the registration of a labour relationship is/are issued. It is also unclear what will happen to entries cancelled by a court’s decision. If the employee was reinstated by a court’s decision or the wording of the termination of the labour contract has changed, then, in the case of a paper employment book, the employee has the right to write a statement and require that a duplicate of the Employment Book be issued. In the case of an EEB, in order to correct an entry, the employee responsible for maintaining personnel records in the organization has to submit a corrective form. At the same time, all the corrections made will be reflected in the electronic system. This means that the next employer will be able to see this information.

It is also worth noting that it is reasonable for employees who in the coming years will draw their pension after reaching the age established by law or who are entitled to an early retirement pension to keep an employment book in paper form. It makes no sense to keep paper form for those who have already had a pension issued or who are not applying for one (for example, in connection with foreign citizenship).

The system of electronic employment books is still far from perfect and may undergo some changes, but a major step has already been taken towards full-fledged electronic document flow. The full-scale transition to electronic employment books is only a matter of time.

FOR INFORMATIONAL PURPOSES 

The regulatory legal acts governing the transition to electronic employment books are:

  1. Federal law No. 439-FZ “On amendments to the Labour Code of the Russian Federation as regards the formation of employment history in electronic form” dated December 16, 2019
  2. Federal law No. 436-FZ “On amendments to the Federal law “On individual (personalized) accounting in the compulsory pension insurance system” dated December 16, 2019
  3. Federal law No. 136-FZ “On amendments to articles 2 and 11 of the Federal law “On individual (personalized) accounting in the compulsory pension insurance system” dated April 24, 2020
  4. Decree No. 590 of the Government of the Russian Federation “On the specifics of the procedure for and the timeframes for insuring parties to submit the employment history of registered persons by to territorial bodies of the Pension Fund of the Russian Federation” dated April 26, 2020
  5. Decree No. 887 of the Government of the Russian Federation dated June 19, 2020
  6. Procedure for filling in the CZV-TD form
  7. Procedure for filling in the STD-R form
  8. Federal law No. 90-FZ “On amendments to the Code of Administrative Offences of the Russian Federation” dated April 1, 2020
  9. Letters of the Ministry of Labour of Russia: No. 14-0/10/V-1703 dated February 5, 2020; No. 14-0/10/V-1704 dated March 5, 2020; No. 14-2/V-269 dated March 16, 2020; No. 14-2/V-267 dated March 16, 2020; No. 14-2/V-260 dated March 13, 2020; No. 14-2/OOG-12933 dated August 12, 2020; and No. 14-2/V-150 dated February 12, 2020

Olga Rybina

Head of HR Department