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15 Jun, 2010 06:48

Employee fines betray weak corporate culture

Firing an employee is not easy in Russia, so companies routinely use fines to motivate underperforming staff. But the system is often unfairly applied - and breaks labour law.

Kirill is a manager in a restaurant service company, which fines staff for a range of infractions.

“We fine workers for being late. For 15 minutes, for 30 minutes, and more than 30 minutes. If you had a hangover and you prefer to stay at home, and pretend that you are sick. Also we fine people for bad appearance."

The average fine he hands out is about $30 to $50 dollars – for dirty nails or a messy work place – it's all taken out of their salary at the end of the month.

”When our boss introduced this table of fines, the workers stopped breaking the rules of our company.”

The practice is adopted by many firms in Russia – big and small…foreign and domestic. Dmitry Voloshuk, Senior Consultant at Ecopsy says there is nothing explicitly enabling this legally, but it is a standard employment practice.

“There is no such thing as fine in the legal documents as a fine for an employer – from an employer for an employee – so you can not fine your staff. But, of course, there is a way to look after the discipline of the people.”

Most companies divide salaries into two parts – fixed pay and an additional bonus that is often equal to or even exceeds the fixed amount, and Voloshuk says this is the mechanism by which fines are imposed.

"Then the company takes. For every mistake they make, for everything they do – takes bites off little pieces of the salary."

Lawyers say the system is open to abuse. Irina's former boss held back half of her salary, then fired her, all for the sin of not picking up the phone when she was on holiday.

”If you agree to getting your salary in envelope – as in many Russian companies…you can’t say anything to the employer. He can make up whatever rules he wants and punish workers.”

But HR specialists say handing out fines can be justified as Russian staff are often not self-disciplining. Trying to correct a misbehaving colleague is seen as the creep's way to the top – and is associated with Soviet times spying.

As such, there's often little pressure on a poor member of staff to become more productive. So, when it comes to the carrot or the stick, the latter- unfortunately – remains the most common way for managers to keep order in the office.