The Russian labour market remains in a period of uncertainty following the global financial crisis and the political and economic instability affected by the Ukrainian crisis.Capital flight within the first three months of 2014 was approximately 60 million USD while the Russian stock market contracted by around 20%. This capital flight has been significantly more concerning since growth within the Russian economy has remained slow since 2011/2012 while inflation is high and the labour market is tight.
The Russian model of labour relations is entirely unique. Rights that are viewed as commonplace in most EU member states have not been adopted. Principles such as freedom of association, the right to collective bargaining and anti-discrimination issues are not the bedrock of the relationship between employer and employee.
In relation to discrimination issues, readers will recall the issue regarding equality issues pre the Sochi Olympic Games. The 2013 ‘Anti-Gay Propaganda’ Laws are particularly interesting to consider within the context of Russian labour relations, especially in relation to large multinational corporations and NGOs operating within Russia.
Whilst Russia has no law which specifically prohibits Lesbian, gay, bisexual and transgender (LGBT) diversity policies, the new anti-gay propaganda legislation is problematic for multinationals as a commitment to diversity and equality of opportunity could conflict with the vague definition ‘propaganda’ as outlined in the legislation.
As an example, supporting the transfer of LGBT employees to Russia coupled with an active promotion of LGBT rights within the workplace, could well be considered an act of propaganda under an all-encompassing definition. This, in turn, is problematic for such corporations as it may colour any selection process decision. For example, a LGBT employee may see a transfer to Russia as a positive career step but a company may be concerned as to how this will be received in Russia. Alternatively, a LGBT employee may refuse to go to Russia on the grounds that they do not feel comfortable working in a potentially hostile nation state.
Certainly Russia is a country undergoing transition and remains an enigma wrapped in a puzzle when it comes to employment law.
Other blogs of interest in our BRICs series:
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