Minimum Wage
According to the Constitution of the Russian Federation, everyone has the right to get salary that will be higher than the federal minimum wage. There are two levels of the minimum wage in Russia: federal and regional. The federal minimum wage is governed under the Federal law ‘About minimum wage’ 19.06.2000 № 82-ФЗ. Regional minimum wages are established by Regional tripartite agreements between trade unions, employer associations and local authorities (for example, Agreement about minimum wage in Moscow Region).
Minimum wages are determined as payable per month. Minimum wage is calculated for work in normal conditions with fulfilment of the set (monthly or hourly) work norm. Bonuses and other additional payments including those for overtime work, work under harmful, especially hazardous conditions, in special nature geographical conditions and with increased health risks, as well as bonuses to anniversaries, for inventions and rationalization proposals, other financial aid are not included in the minimum wage.
The minimum wage is calculated taking into account the median salary. It is calculated according to a complex formula by the Federal State Statistics Service for the previous year. Since 2025 the ratio of the minimum wage to the median salary will be 48%. It is reviewed at least once every 5 years. At the same time, the minimum wage for the next year must not be lower than, firstly, the living wage for the working population in the country for the next year, and secondly, the minimum wage for the current year.
Establishing the rate of salary below the minimum wage can lead to the notification or the administrative fine at the amount of from 10,000 to 20,000 RUB (for officials), from 1,000 to 5,000 RUB (for individual entrepreneurs), from 30,000 to 50,000 RUB (for legal entities). According to the Criminal Code, the payment of salary below the minimum wage more than two months (if the head of the organization is the interested party) will be punished by a fine of 100,000 to 500,000 rubles or in the amount of the salary (other income) of the convicted person for a period of up to 3 years, or forced labor for up to 3 years or imprisonment for up to 3 years with deprivation of the right to hold certain positions or engage in certain activities for up to 3 years or without it. The employee has the right to complain to the Labor Inspection or to sue (within one year from the date of payment). The employer (if the salary was not paid at the first time) will be relieved of criminal liability if he pays the salary and the interest during 2 months from the date of filing of the criminal case.
In Russian legislation, the 13th and 14th salaries, as well as other additional payments (bonuses, rewards), are not mandatory and are not established by federal law as guaranteed payments. Their availability and payment procedures are determined at the employer's level and are considered incentive payments.
Compensatory allowances, including those for working under conditions deviating from the norm, incentive allowances, and bonus systems, are established by collective agreements, agreements, local regulations in accordance with labour laws and other regulatory legal acts containing labour law provisions.
An employer may reward employees who perform their work duties in good faith (by declaring gratitude, awarding a bonus, granting a valuable gift, a certificate of honour, or nominating them for the title of the best in their profession). Employee incentives for work are determined by the collective agreement or the internal labour regulations, as well as by the statutes and provisions regarding discipline.
Sources: §37 of the Constitution; §129, 133-133.1, 135, 139 392 of the Labour Code; Federal law ‘About minimum wage’ 19.06.2000 № 82-ФЗ; Tripartite agreement in Moscow Region about minimum wage; § 145.1 of the Criminal Code; § 5.27 of the Code of Administrative Offences; Order of the Federal State Statistics Service 31.12.2020 №870
For updated minimum wage rates, please refer to the section on minimum wage.
Regular Pay
Salary is the fixed remuneration for performance of work (for a calendar month) based on and appropriate to the professional skills, difficulty, quantity and quality of labour and working conditions and includes additional payments as compensations for working in conditions other than the normal ones and incentive payments. The relevant law on payment of wages is Labour Code.
According to the Labour Code, wage must be paid at least twice a month (on fortnightly basis) at the day established by internal labour regulations, collective agreement, labour/employment contract. In the case of the coincidence between the weekend or a non-working holiday and the day specified for payment of wages, wages must be paid on the previous working day.
Wages may be paid in cash at the workplace or transferred into worker’s bank account nominated by the employee. Wages must not be paid to a third person. Wages must be paid in monetary form and in legal tender, i.e., the roubles. An employment contract or collective agreement may provide for in kind payment of wages which cannot exceed 20% of employee’s monthly remuneration.
Delaying payment of wages to workers is an administrative offence (and may also lead to criminal offence) and the employer can be fined by the labour authorities. In accordance with the Labour Code, in the case of arrears in payment, employer must also pay compensation (higher than one hundred and fiftieth (0.0067) of the key rate of the Central Bank of the Russian Federation from accrued but unpaid or not accrued on time amounts for each day of delay). Compensation is paid from the day following the day on which these amounts should have been paid if they were accrued on time to the day of the final payment inclusive.
If a worker’s wages are delayed for more than 15 days, he may stop working, after notifying the employer, until receiving the salary. If the employer informs the worker that he is ready to pay overdue sum, worker must report to the work. The right to suspend work is not available to members of armed forces, military personnel, firefighting, rescue services, civil servants, and for the employees in emergency services and vital public services (energy, water supply and communications).
Deductions from an employee’s wages can be made only for cases specified by the Labour Code and other federal laws. Employers are allowed to deduct personal income tax from an employee’s pay and pass that deducted amount to the tax authorities. Employers are further allowed to make deductions from a worker’s wage to retrieve/recover the sum of money owed by the employee to the employer. This happens in the recovery of:
* advances of pay;
* amount given to an employee for travel or other expenses which was not spent and was not refunded instantly by the employee;
* sums that were overpaid to the employee (due to an accounting error or because of an illegal action as established by the Court);
* holiday/annual leave pay, if employment terminates and worker has already taken leave in excess of his accrued entitlement at the point of termination (however this recovery is not possible if termination was on the ground of worker’s ill health, redundancy or employer’s liquidation).
The total amount of deductions at each payment of wages cannot exceed 20 percent, and in the cases where the worker is subject to more than one attachment order, the maximum total deduction is 50 percent of the wages. Where the employee’s wages are attached for specified reasons, the deduction can rise to as high as 70% (in cases of correctional work, alimony for minor children, and redress of wrong, and restitution of injury causes to health of another person).
Labour Code requires that employees who perform heavy labour or work in harmful, dangerous and other special conditions must be paid at a higher rate than workers engaged in normal working conditions. The increased rate of pay is set by the collective agreement, employment contract or by the employer while taking into account the opinion of trade unions or other employee representatives. Similarly, some localities in the Federation are designated as localities with special climatic conditions. Employees working in these areas are paid higher than the normal wage rate. The minimum premium is set by legislation and varies for areas.
In Russian legislation, the 13th and 14th salaries, as well as other additional payments (bonuses, rewards), are not mandatory and are not established by federal law as guaranteed payments. Their availability and payment procedures are determined at the employer's level and are considered incentive payments.
Compensatory allowances, including those for working under conditions deviating from the norm, incentive allowances, and bonus systems, are established by collective agreements, agreements, local regulations in accordance with labour laws and other regulatory legal acts containing labour law provisions.
An employer may reward employees who perform their work duties in good faith (by declaring gratitude, awarding a bonus, granting a valuable gift, a certificate of honour, or nominating them for the title of the best in their profession). Employee incentives for work are determined by the collective agreement or the internal labour regulations, as well as by the statutes and provisions regarding discipline.
Sources: Articles 136,- 148 191 and 236 of the Labour Code of the Russian Federation
