How to register an Indefinite Validity Agreement
- “A similar contract procedure is valid for all subsequent years.”
- “The agreement can be renewed on these terms annually.”
- “This agreement may be repeatedly extended”, etc.
If, by concluding such an additional agreement, the parties decide only to extend the term of the contract, then it is recommended to indicate that other conditions remain unchanged. If any provisions of the original agreement are adjusted, they are also recorded in the additional agreement.
Agreement with extension of validity period: terms of auto-extension by agreement of the parties (read more...)
What nuances to pay attention to
A fixed-term contract must include several points:
- information about the employee and employer,
- duties of the parties,
- duration of the contract and start date of work,
- grounds for concluding an agreement,
- salary,
- social insurance,
- work and rest schedule,
- guarantees for the employee.
Oksana Vasilyeva, expert on legal issues in business, General Director of Mariox Center LLC:
The following additional conditions may also be included in the content of a fixed-term employment contract: as a rule, these are the duration and conditions of the probationary period when hiring, as well as a condition on non-disclosure of trade secrets.
There are three more points that are important to remember in order to avoid problems.
1) Three days before the end of the contract, the employee must be notified in writing of dismissal, otherwise the contract will automatically become unlimited.
Oksana Vasilyeva, expert on legal issues in business, General Director of Mariox Center LLC:
A fixed-term employment contract automatically becomes indefinite if the employee does not receive notice of dismissal from the employer three days before the expiration of the fixed-term employment contract, or both parties have forgotten about the termination period and the employee continues to perform his job duties. If the rights of an employee under a fixed-term employment contract are violated, the court will reinstate him at work, force the employer to pay for forced absence, and possibly moral damages.
2) You cannot constantly renew a fixed-term employment contract with an employee who actually works as a permanent employee of the company. This strategy could result in a court summons.
Arthur Sinikhin, partner of the Legal Bridge Bar Association:
If the validity period of an employment contract exceeds five years, then if disputes arise, there is a high probability that such an agreement will be reclassified by the court as concluded for an indefinite period. Similar consequences may arise if it is established that the contract has been re-signed multiple times, including if the total term of its validity exceeds five years.
3) A fixed-term employment contract cannot be concluded as an alternative to an open-ended one, unless there are grounds for this. This is a violation of Article 5.27 of the Code of Administrative Offenses of the Russian Federation, for which an official and an individual entrepreneur can be fined in the amount of 1 to 5 thousand rubles, and the company in the amount of 30 thousand rubles. up to 50 thousand rubles.
How many times can the contract be extended?
Duration of an open-ended contract: wording
- “This agreement is concluded for an indefinite period.”
- “This agreement is of unlimited duration,” etc.
The concept of a government contract term is not contained in the current version of 44-FZ. This law does not say that the terms of the contract must be included in the text of the agreement without fail. But this point is desirable, as it allows us to judge the integrity of the customer or supplier.
Common Mistakes
The main mistake of the employer is the opinion that benefits do not apply to an employee under a fixed-term contract and it is easier to fire him. Violation of established procedures leads to the automatic transfer of a fixed-term employment contract to an open-ended one. If 3 days before the expected date of completion of cooperation a person has not received a notice of termination of the contract, it can be considered extended for an indefinite period, i.e. before a decision is made to dismiss an employee.
If, upon termination of cooperation, difficulties arise in determining the last working day, it is advisable to draw up an acceptance certificate for the work performed.
How to register an Indefinite Validity Agreement
The exact definition of an employment contract is given in Article 56 of the Labor Code of the Russian Federation. It refers to an agreement under which an employer provides a citizen with work. The person is obliged to personally perform labor duties, and the employer is obliged to pay wages for this.
The contract must include the start date of work. From this moment, wages are calculated and local regulations come into force, which the citizen must comply with. It is recommended to indicate in the text that the agreement is of an indefinite nature.
In what cases is an open-ended contract concluded? (read more…)
In what cases is a fixed-term employment contract needed?
An employment contract is needed to replace an employee who is absent from work but retains his position, for example, after going on maternity leave or military service. Under a fixed-term contract, workers are hired for temporary or seasonal work.
There are several other grounds on which a fixed-term employment contract can be concluded by agreement of the parties; they can be found in Art. 59 Labor Code of the Russian Federation.
The concept of an open-ended employment contract
Example 3. The company entered into an employment contract with E.V. Lobov for an indefinite period. The text of the document contains the following information: “The contract is of unlimited duration. The employee begins work on January 9, 2019.”
Example 2. K. S. Glotov is hired at Zvezda LLC as a marketing specialist. The HR employee entered the following information into the contract: “The employer is hiring an employee for the position of leading marketer in the advertising department.”
- How to write that the contract is unlimited
Download the open-ended employment contract (Form.doc)
The contract is drawn up in writing in two copies. After signing, one remains with the employer, the second with the employee. The document must contain the essential conditions named in Article 57 of the Labor Code of the Russian Federation.
Place of work
The text should indicate the full name and address of the company where the employee will work. If he is accepted into a division or branch located at an address that does not coincide with the location of the head office, the address of actual employment is entered.
Example 1. I. A. Sovelyev is hired as an accountant at the DOM LLC branch. The company is located in Blagoveshchensk, and its structural unit is in Tynda. The employment contract indicated the following information: “The employee is hired by the branch of the limited liability company “DOM”, located in the Amur region, Tynda.”
Labor function
Be sure to describe in detail the condition of the type of work, job title, and qualifications. The employer does not have the right to assign functions to the employee that are not provided for in the contract.
Example 2. K. S. Glotov is hired at Zvezda LLC as a marketing specialist. The HR employee entered the following information into the contract: “The employer is hiring an employee for the position of leading marketer in the advertising department.”
Deadlines
The contract must include the start date of work. From this moment, wages are calculated and local regulations come into force, which the citizen must comply with. It is recommended to indicate in the text that the agreement is of an indefinite nature.
Example 3. The company entered into an employment contract with E.V. Lobov for an indefinite period. The text of the document contains the following information: “The contract is of unlimited duration. The employee begins work on January 9, 2021.”
Salary
The contract must specifically state the terms of payment. All due payments are indicated:
- salary (tariff rate);
- incentive payments;
- compensation payments;
- bonuses;
- allowances.
The method of issuing funds and the days of payment are also prescribed. If the parties do not come to an agreement on this point, the contract will not be considered concluded.
Working hours
Typically, working hours are prescribed in the internal labor regulations.
The contract should include information about:
- work week (five or six days);
- duration of the working day or shift;
- start and end hours;
- break time;
- number of shifts
If break time cannot be allocated separately due to the nature of work, then it is included in working hours.
Other Required Conditions
It should also be stated whether the work involves harmful or dangerous working conditions. In this case, the employee is entitled to compensation.
It happens that an employee needs to travel frequently on business trips. This point should also be stated in the agreement.
The company makes contributions to compulsory social insurance. Therefore, the contract stipulates that the employee is subject to all types of insurance.
Additional terms
The parties have the right to detail other aspects of cooperation in the contract.
The document includes the following conditions:
- about the probationary period;
- on non-disclosure of commercial, medical, official and other secrets;
- about additional insurance;
- about the employee’s obligation to work for a certain period after training;
- on increasing the duration of vacation;
- other points.
It is important that an open-ended employment contract does not worsen the position of a citizen in comparison with the Labor Code of the Russian Federation.
When a fixed-term employment contract “turns” into an open-ended one
Please note that according to Art. 58 of the Labor Code of the Russian Federation and paragraph 14 of the Resolution of the Plenum of the Supreme Court dated March 17, 2004 No. 2. repeated conclusion of fixed-term employment contracts for a short period to perform the same work can lead to the court recognizing the contract as indefinite.
The Federal Tax Service reminds you of the possibility of making changes to a fixed-term employment contract, including in terms of changing its expiration date. In this case, changes are made only by signing an agreement (Letter of the Federal Tax Service dated October 31, 2007 No. 4413-6).
If a fixed-term employment contract is concluded for a period exceeding 5 years, then there is a high probability that in the event of a dispute, the court may reclassify it as a contract concluded for an indefinite period. The same consequences may arise in a situation where several employment contracts have been concluded, the total duration of which exceeds 5 years, as stated in paragraph 14 of the Resolution of the Plenum of the Supreme Court dated March 17, 2004 No. 2.
The conditions on the fixed-term nature of the employment contract lose force if neither party requested termination of the contract and if the employee continues to work (Article 58 of the Labor Code of the Russian Federation). If these conditions are met, then the contract is considered concluded for an indefinite period. At the same time, the legislation does not provide for the need to amend the employment contract itself by signing an additional agreement. At the same time, Rostrud, in Letter No. 1904-6-1 dated November 20, 2006, recommends concluding such an agreement. In this case, you do not need to make an entry in the work book.
Essential terms of the license agreement
Any license contains a number of conditions that are considered essential - especially important from the point of view of the law, the violation of which entails serious consequences for the licensee, including termination of the contract. The essential terms of the license agreement include:
- the subject of the agreement (the license must indicate the specific result of intellectual activity that is provided for use by the licensee, as well as the number of the patent or certificate confirming the exclusive right to this object, if such documents are available);
- the ways in which the licensee is permitted to use the IP;
- the remuneration that the licensee undertakes to transfer (transfer) to the author or copyright holder, as well as the procedure for its transfer. If the parties have agreed on the free use of intellectual property, this should be stated in the contract.
If at least one of the essential conditions does not appear in the agreement, such an agreement will be considered not concluded.
They do not affect the fact of concluding the contract, but the following conditions are no less important:
- granted right - the licensee can use the intellectual property only in those ways that are expressly specified in the contract;
- territory - if the specific territory in which the licensee is allowed to use the intellectual property is not specified, it is considered that he can use the subject of the agreement throughout the entire territory of the Russian Federation
- validity period of the license agreement - if a specific validity period of the agreement is not specified, it is considered to be concluded for 5 years. But in any case, this period cannot exceed the period of validity of the exclusive right to the corresponding object of intellectual property.
Finally, the license agreement may provide for liability of the parties in case of violation of its terms.
