Reducing the number of employees and downsizing in an organization due to war

If a company is unable to keep jobs and decides to reduce the number of employees or downsize a department in an organization, it can do this on the basis of Article 40, paragraph 1, point 1 of the Labor Code.

What is the difference between reducing the number of employees and downsizing in organizations?

Downsizing in an organization is the dismissal of all employees of a certain profession or subdivision. For example, if an organization completely closes its procurement department.
 Reducing the number of employees is the dismissal of several employees of different professions or reducing some number of employees of one profession. For example, if one person from each department is fired, or if three of the four marketers remain.

Who can't be fired during reducing the number of employees and downsizing in organizations?

Not allowed to fire

• pregnant women,
• women with children under the age of 3 years (or under 6 years if the child needs care on the basis of a medical report),
• a single mother with a child under the age of 14 or a child with a disability,
• workers called for military service and listed in Art. 119 of the Labor Code,
• the worker who was previously elected to a labor union and now is not completed one year since the ending of his power in the labor union (Art. 252 of the Labor Code),
• employees under the age of 18. They can be dismissed only with the consent of the district or city children's service and with further compulsory employment.

How to dismiss a worker in case of reducing the number of employees and downsizing in an organization?

First step

In order to lay off employees on the basis of Article 40, paragraph 1, point 1 of the Labor Code, you must first develop a feasibility study to reduce the number of employees.
If the company has a trade union, it is necessary to notify them at least three months before the dismissal date about the reasons for such a decision, the number and category of employees subjects to dismissal, and the term of dismissal. During martial law, a company is exempt from obtaining pre-approval from a labor union (Law No. 2136).
If the company does not have a labor union, it is necessary to create an Order to reduce the number of employees or downsize a department in an organization.
In the Order specifies

• what changes there will be in the work of the company,
• reasons for dismissal of employees,
• names of the positions that fall under the reduction (it is not necessary to list the names of employees),
• the date of starting layoffs at the company.

Second step

Make a new work schedule or make changes to the existing one.
At least 2 months before the start of layoffs, you must submit to the employment center a reporting form № 4-PN «Information about planned mass layoffs of workers due to changes in the organization of production and labor».
A mass dismissal means the firing of

• 10 or more workers at a time or within a month if the number of employees in the company is between 20 and 100 people,
• 10% of employees, if the number of employees in the company is 101 to 300 people,
• 20% of the total number of employees at a time or within three months.

Next, you must determine the list of workers to be laid off and notify them two months before the planned layoff date. Don't forget that some workers have priority rights to keep their jobs during layoffs. The list of such categories can be found in Article 42 of the Labor Code. If the company has the opportunity, you can offer the employee another job at the same company instead of dismissal.

Third step

Create an Order for dismissal on the basis of Article 40, paragraph 1, point 1 of the Labor Code.
If a labor union employee is falling under the layoff, the Order may be issued not earlier than one month after receiving the consent of the labor union organization.

Dismissal during leave

In pre-war times, it was illegal to fire workers who were on vacation or sick leave. There are no such restrictions during martial law. The only exception is for female employees who are on maternity or child care leave up to three years old, and they cannot be fired.

On the dismissal date

The employee must be paid all earned salary and severance pay in the amount not less than the average monthly earnings.
If the employee has a work record book, it is necessary to enter information about the dismissal into it and give to the employee this book with a copy of the dismissal order.