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State Labor Service Inspections suddenly cancelled

State Labor Service Inspections not completed by May 14, 2019 are unlawful. On May 14, 2019 the Sixth Administrative Court of Appeal invalidated the Decree of the Cabinet of Ministers of Ukraine No. 295, dated April 26, 2017, which approved the Procedure for State Control of Compliance with Labor Legislation. Therefore, from the said date there is no regulatory act that regulates the procedure for carrying out the relevant inspections.

All inspections not completed on the said date should no longer be completed, as there is no regulation of this procedure.

But the risk of applying fines has not disappeared. The procedure for the application of fines for violation of legislation on labor and employment, approved by the Decree of the Cabinet of Ministers of Ukraine No. 509, dated July 17, 2013 is not cancelled.

This procedure provides three grounds for application of fines, namely:

1) Court decision on conclusion of the employment contract and legalization of labor relations;

2) Inspection certificate drawn up by the inspector of the State Labor Service or the executive committee of local council;

3) Certificate of documentary scheduled tax inspection.

From the effective date of the said court decision, the second ground is now absent.

In case of completion of inspection and drawing up of certificate prior to May 14, 2019 there is no clear position. Since the regulatory act has been cancelled on the said date, all documents drawn up prior to the date of cancellation are legal. On the other hand equality of rights of entities is violated depending on the period of inspection. Therefore, the final decision should be left for the courts.

If the inspection as of May 14, 2019 is not completed, then, due to clear requirements that any discrepancy in the varying interpretation of provisions of laws and by-laws should be interpreted in favor of the person against whom the inspection is conducted, there are all grounds to appeal against actions of the State Labor Service in court and obtain a positive court decision.

Kyrylo Kazak

Partner

KPD Consulting

 

 

Should you have any questions with respect to above or require any additional information, please do not hesitate to contact Mr. Kyrylo Kazak (k.kazak@kpdconsulting.com.ua). We will be pleased to assist You. The information contained in this overview is not intended to provide legal advice and should not be relied on or treated as a substitute for specific advice concerning individual situations.

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