Fines for not employing disabled people may backfire

Fines for not employing disabled people can worsen their employment prospects




The Ministry of Labour has proposed to levy compensation from employers for their non-employment of people with disabilities. The pilot project will be implemented in five regions around country.


The experiment will last five years, from January 1, 2020 to December 31, 2025. The Republic of Sakha (Yakutia), Voronezh, Oryol, Sverdlovsk and Tver were selected as the pilot requires “regions with the national average proportion of working age disabled people in employment in 2018”.


According to TASS, companies will be fined in the event that they do not meet their legal obligations: individuals 10-20 000 rubles, and companies 150-300 000 rubles.


At the moment, companies must meet a quota for employing people with disabilities. For enterprises with more than 100 employees, this is set at 2-4% of their total workforce. For employers with between 35 and 100 employees, their obligations are capped at 3%. These quotas are fulfilled only by hiring people with disabilities.


The Ministry of Labor believes that this mechanism is “inconvenient for employers, ambiguous in implementation and does not maximise the potential benefits of enforcing a quota system for hiring disabled people”.


The ministry says that ‘the new draft law proposes the creation of a fund for the promotion of employment for disabled people. It will allow employers to make compensatory contributions to this fund as an alternative option to hiring disabled people.’


The size of the compensation payment is proposed to be in accordance with the subsistence minimum for the working-age population in the region.


‘A similar system has been operating in Moscow for several years but was recently abandoned after many corruption schemes for billions of rubles were revealed,” explained Mikhail Novikov, head of the employment department of the disability-focused NGO Perspektiva. ‘This system has already demonstrated its inefficiency, so it’s good that the ministry is not trying to apply it right across Russia, but has chosen to pilot it in these regions to judge its performance. Perhaps in the regions it will be less corrupt than here.’


According to Novikov, the city authorities are responding to such initiatives: ‘Take whatever you want, but not the economic incentives of employers.’ He is sure that ‘employing people with disabilities rather than paying the compensation is considered to be quite a serious incentive, but after the adoption of the new law the compensation payments will be smoothed over’.


‘Many organisations will prefer to simply pay the compensation instead of hiring disabled people. Therefore, the law will not encourage the employment of disabled people but will damage the prospects of the disabled in the labour market’.



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