Employment contract or contract? The Supreme Court suggested differences.

Hiring under a contract, how it differs from an employment contract

Referring to contracts of a civil law nature, the contract is regulated by the Civil Code of the Russian Federation.
According to paragraph 1 of Art. 702 of the Civil Code of the Russian Federation, the contractor and the customer enter into an agreement between themselves, according to which one of them (the contractor) must perform a certain amount of work, and the other party (the customer) must accept it and pay in the established amount. The main difference between an employment contract and a work contract is that in the first case the employee is obliged to perform the labor function described in the agreement, which the employer has the right to control and adjust (Article 56 of the Labor Code of the Russian Federation). As for the contract, here the contractor is only required to present a high-quality result of the work; the customer does not interfere in his process. Therefore, the contractor himself decides how exactly to complete the task, unless otherwise provided by the agreement (Clause 3 of Article 703 of the Civil Code of the Russian Federation).

Contract agreement for design and survey work

This agreement is aimed at the contractor carrying out work on drawing up technical documentation or carrying out any survey (research) work.

In case of fulfillment of contractual obligations, the customer must pay them.

The contract is concluded with one design organization, which in the future can enter into subcontract agreements for certain types of work with smaller organizations.

This agreement can be concluded either in the usual manner or based on the results of the auction.

The customer can be both an individual and a legal entity.

The contractor is only a legal entity that has a license to carry out the requested work.

You will probably be interested in looking at the mental map “Contract (work performance)”, which specifies what the contractor is obliged to warn the customer about

Or HERE you will find out what the consequences of violating social norms are

What types of employment agreements are there:

What must be specified in the design and survey contract

For this form of contract, the law does not establish a clear design, but in general it is necessary to include in it the points inherent in all construction contracts:

• Name and full details of the contractor's and customer's organizations.
• The subject of the contract is the name and specifics of the work performed, its volume. At this point, you must specifically specify all the details of the order.
• Payment for work - payment terms, amount of remuneration (price is determined according to the estimate). If the cost is not determined by the terms of the contract, then the work performed is paid in accordance with similar services or work ( Article 424, paragraph 3 of the Civil Code of the Russian Federation
  ).
• Timing of work - here, in addition to the beginning and end of the order, you can specify fractional execution with a report for each completed stage.
• Responsibility of the parties.
• Settlement of disputes.
• Date of.
• Signatures and seals of the parties.

Attachments to the contract

• terms of reference;
• work schedule;
• permission (license) of the customer to carry out work;
• estimate;
• permission (license) of the contractor to carry out work.

Documents attached to the contract

• Certificate of cost of work and expenses ( form KS-3
  );
• act of acceptance of completed work ( form KS-2
  );
• protocol of disagreements;
• additional agreement;
• Protocol for reconciliation of disagreements.

Deadlines for filing claims under the contract

For two years for services rendered.

The essential points of the contract are

• The subject of the contract, in which it is necessary to describe not only the details of the order, but also the quality of the result obtained.
• Responsibility of the parties - here, among other things, it is necessary to indicate: full compliance of the completed task with all points of the technical order;
• prohibition on using data for purposes other than those specified in this agreement;
• prohibition on transferring any data provided by the customer or conclusions on the work performed to third parties without the consent of the customer;
• conditions for termination of the contract (systematic violation of the terms of the document by any party, bankruptcy of the customer carried out according to a regulated procedure).

Employment under a contract - advantages of the agreement

Before deciding to work under a contract, the pros and cons of this type of transaction should be studied in detail.

The main advantages for the customer are that there is no need to:

• payment of sick leave and vacation pay;
• providing the contractor with a workplace and materials for work.
• payment of insurance premiums.

For the contractor, the advantages of working under this type of contract are:

• the possibility of non-compliance with the company’s internal regulations - this means that he can come to and leave work at a time convenient for himself, not adhere to the dress code, and not comply with labor protection requirements, which apply only to workers under an employment contract;
• lack of control on the part of the customer (if the relevant conditions are not specified in the contract);
• the ability to combine activities with the main job;
• possibility of attracting subcontractors.

In addition, it should be taken into account that the law does not prohibit the transition of civil law relations into labor relations (by concluding an employment contract with a contractor). This means that each side has the time and opportunity to take a closer look at each other and decide on further cooperation in a completely different form.

OTHER CONDITIONS

5.1. This agreement comes into force from the moment it is signed by both Parties and is valid until the Parties fully fulfill their obligations. 5.2. The Agreement may be terminated early by agreement of the Parties. In this case, the Parties are obliged to notify each other in writing no later than 10 days before the expected date of termination of the agreement. 5.3. The Customer, at any time during the validity of this contract, has the right to cancel this contract, subject to payment to the Contractor of the expenses actually incurred and documented by the Contractor. 5.4. The Contractor has the right to refuse to fulfill its obligations under this Agreement only if it fully compensates the Customer for losses. 5.5. In all other respects that are not regulated by this agreement, the Parties are guided by the current legislation of the Republic of Belarus. 5.6. All disputes and disagreements arising from this Agreement shall be resolved by the Customer and the Contractor through negotiations, if possible. If no agreement is reached, all unresolved disputes arising from the execution of this Agreement shall be referred to the court for resolution in accordance with the legislation of the Republic of Belarus. 5.7. This agreement has been drawn up in two copies, in Russian, having equal legal force, one for each of the Parties. 5.8. Additional agreements, acceptance certificates for completed work, annexes signed to this agreement by both parties are an integral part of this Agreement.

Registration of a contract - what pitfalls may lie in wait

Contract agreement with an individual
Despite the significant number of advantages of this method of performing activities, the contract agreement also has disadvantages. At the same time, for the customer they are minimal and consist only in the absence of the opportunity to interfere in the work process. As for the contractor, by agreeing to work under a contract, he voluntarily deprives himself of a number of social benefits provided for by the employment contract:

• paid leave and sick leave, including maternity leave;
• days off;
• bonuses;
• social insurance.

In addition, the contractor does not have insurance for the result of his work, so it may be damaged before it is accepted by the customer (for example, due to the negligence of subcontractors), resulting in the risk of non-payment.

Service agreement

It is somewhat more difficult to distinguish a service agreement from an employment contract. If the meaning of the contract is precisely the result of the work, then the services are provided constantly, that is, here, too, the basis of the relationship is the process, not the result. But here it is necessary to look at the contract itself: it should reflect only the relations of the parties regarding the provision of services - all references to labor legislation or organization documents are meaningless.

Here it must also be said about the work book: in civil law relations, no entries are made to the contractor or performer in it.

True, it is worth noting that if an employee (namely an employee) of an enterprise is asked to work under a contract or provision of services outside of regular working hours, including on weekends or on vacation, then there is nothing illegal here, unless, of course, the court decides otherwise.

Is a contract included in the length of service?

According to Part 1 of Art. 11 of the Law “On Insurance Pensions” dated December 28, 2013 No. 400-FZ, insurance length of service (this is how work experience began to be called after the pension reform of 2002) is formed through the performance by an individual of any type of work, subject to payment of insurance contributions to the Pension Fund. According to Part 1 of Art. 4 of Law 400-FZ, each insured person has the right to apply for an insurance pension after reaching a certain age.

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Thus, the period of work under a contract is included in the total length of service and is taken into account when calculating the amount of pension payment if insurance premiums are paid for the contractor.

CONDITIONS OF WORK AND OBLIGATIONS OF THE PARTIES

2.1. The Contractor undertakes to: 2.1.1.perform the work provided for in paragraph 1.1. of this agreement, within the terms agreed upon by the parties, as well as in accordance with the requirements set by the Customer for the quality of the work performed; 2.1.2. ensure timely elimination of deficiencies in the work performed identified by the Customer; 2.1.3. ensure the safety and careful use of equipment transferred by the Customer, other property and material assets necessary to perform work under this contract; 2.1.4. not to disclose to third parties the results obtained during the performance of work for the Customer, to take the necessary measures to protect information provided by the Customer or that became known to the Contractor in connection with the execution of this contract; 2.1.5. in the case of performing work at a place of work provided by the Customer using equipment provided by the Customer, comply with the relevant instructions, rules and other local regulations of the Customer establishing requirements for safe working conditions; 2.1.6. not to transfer your rights and obligations under this agreement to third parties; 2.1.7. follow the Customer’s instructions regarding the nature and content of the work; 2.1.8. use personal protective equipment when performing work in cases established by the Customer or legal requirements. 2.2. The Customer undertakes: 2.2.1. provide the Contractor, if necessary, with a place to perform work, special equipment that complies with labor protection and safety regulations; 2.2.2. pay properly and within the time limits established by this agreement for the work performed by the Contractor under this Agreement; 2.2.3. ensure payment for the Contractor of mandatory insurance contributions for state social insurance to the Social Protection Fund of the Ministry of Labor and Social Protection; 2.2.4. if the Contractor is provided with a place to perform work under this contract, including the provision of special equipment, provide preparation (training), instruction and testing of the Contractor’s knowledge on the issues of safe conditions for performing work under this contract, or require documents confirming that the Contractor has completed training (training). ), instruction, advanced training on safe working conditions; 2.2.5. not allow (suspend) from performing work on the relevant day the Contractor who appears at the place of work provided by the Customer in a state of alcohol, drug or toxic intoxication, as well as in a condition associated with illness that prevents the performance of work under this contract; 2.2.6. ensure unimpeded access to representatives of government bodies and other organizations whose competence includes carrying out inspections and monitoring compliance with legislation, incl. checks the conditions for the execution of work under this Agreement, as well as provide information necessary for carrying out control activities; 2.2.7. investigate or take part in the investigation of industrial accidents and occupational diseases in the manner prescribed by law. 2.3. The customer has the right: 2.3.1. check the quality of the work performed by the Contractor, as well as give instructions on the progress of the work regarding the nature and content of the work under this Agreement; 2.3.2. exercise other rights provided for by the legislation of the Republic of Belarus. 2.4. The Contractor has the right: 2.4.1. refuse to perform this Agreement in whole or in part if the Customer has not created or improperly created the conditions for the safe performance of work provided for in this Agreement; 2.4.2. exercise other rights provided for by the legislation of the Republic of Belarus.

How are taxes and insurance premiums paid if the work is under a contract?

It is necessary to calculate and withhold personal income tax from payments under a contract if the transaction is not concluded with an individual entrepreneur. At the same time, withhold personal income tax every time you make a payment. Individual entrepreneurs themselves pay personal income tax on their income.

The contractor recognizes revenue on the date of transfer of completed work to the customer. The amount of income is determined on the basis of primary documents, as well as tax accounting documents.

In the case where the deal is concluded for a long period, and the work is carried out over several tax periods, and the phased delivery of the work is not provided for in the contract, the contractor is obliged to distribute the income himself.

When you enter into a contract with an individual, you do not need to pay contributions to the Social Insurance Fund for VnIM (compulsory insurance in connection with maternity). If the contract provides for the payment of contributions for injuries, list them.

You can claim a professional deduction if the individual contractor submits such a claim to you. Contributions for compulsory pension and health insurance must be accrued on the date of signing the acceptance certificate.

Employment contract or contract? The Supreme Court suggested differences.

Labor disputes related to the conclusion of work contracts with individuals, instead of employment contracts, are not uncommon in our time. The labor inspectorate and tax service see in such legal relations signs of an employment contract.

What are the penalties for non-employment? What is the difference between a contract and an employment contract? Where is the line when one agreement is transformed into another?

The Supreme Court of the Russian Federation, in its Ruling of the Supreme Court of the Russian Federation dated September 25, 2017 N 66-KG17-10, finally dotted the i's and named the distinctive features. Knowledge of these signs will help the employer protect himself from attacks from fiscal authorities, help decide what kind of agreement with an individual should be concluded in a particular situation, and provide a legal position in court.

Contract or employment contract?

So what did the Supreme Court say?

Firstly , the purpose of the contract is to obtain a specific result, and not to perform the work as such. The labor contract must be tailored to achieve certain goals. If an individual works, performs a certain function and no visible goals are pursued in the contract, then this work has the characteristic of an employment contract.

Secondly , the contractor remains an independent economic entity and acts at his own peril and risk. Result received - work accepted, no result, done poorly - work not accepted.

Thirdly , the contractor is not subject to the labor regime. He works either according to an agreed schedule, if this is, say, construction, or at any time convenient for him. He can work both at night and on weekends, the main thing is that the result of the work is achieved.. If the “contractor” comes to the customer’s premises every working day to work during the hours determined by the customer’s work schedule, on fixed assets belonging to the customer, then there is an employment relationship.

Reasons why employers love contract contracts so much.

There are many reasons, and this is not only a reduction in the tax burden on insurance premiums. A civil contract does not burden the employer with a number of responsibilities:

1. There is no need to provide work or pay for downtime;
2. There is no need to pay vacation pay or compensation upon dismissal;
3. There is no need to pay wages on time;
4. No need to pay sick leave;
5. There is no need to terminate the contract only on the grounds provided for by the Labor Code;
6. There is no need to pay insurance premiums for compulsory insurance against industrial accidents and occupational diseases (unless the obligation to pay them is expressly stipulated by the terms of the contract),
7. There is no need to pay insurance premiums for the Social Insurance Fund.

How else can you save on a contract?

1. If you conclude a contract with an individual entrepreneur, you do not have to pay insurance premiums. Entrepreneurs are required to list them for themselves.
2. When concluding a contract with foreigners or stateless persons temporarily staying in the Russian Federation, insurance premiums are not charged at all (subclause 15, clause 1, article 422 of the Tax Code of the Russian Federation).
3. By concluding contract agreements with students studying full-time at universities of the Russian Federation, as part of student teams, the company is exempt from paying insurance contributions to the Pension Fund of the Russian Federation (clause 3 of Article 422 of the Tax Code of the Russian Federation). Before concluding a contract agreement, it is necessary to carefully analyze its contents to determine whether controversial points that allow it to be interpreted as labor.

What to pay attention to when concluding a contract?

Nuances that must be taken into account when drawing up a contract:

1. The text must clearly indicate the period during which the work must be completed;
2. The amount of remuneration must be reflected for the entire scope of work, it should not be divided by time periods;
3. The contract should not contain references to job descriptions or the operating mode of the enterprise;
4. It is necessary to reflect the list of works (services) that must be performed (provided) by an individual;
5. It is necessary to reflect the procedure for delivery and acceptance; the fact that the full scope of work (services) has been completed must be confirmed by an act of acceptance of completed work (services), signed by both parties;
6. The work must be one-time;
7. It is necessary to reflect the requirements for the quality of work;
8. It is necessary to reflect the responsibility of the parties for violation of the terms of the contract;
9. If an organization has entered into a civil contract with an employee who is on the staff of this organization, then the list of works under the concluded contract must be performed by the employee during non-working hours, otherwise this work will be considered part-time work.

Consequences of replacing labor relations with civil law ones

There is no doubt that a civil contract is much more beneficial for the employer than an employment contract. But here lies a danger in the form of the court recognizing the contract concluded with an individual not as a civil contract, but as a labor contract. The court can do this either at the request of the labor inspectorate or at the request of the individual himself. In addition to measures of administrative liability, in the event of replacement of labor relations with civil law ones, the organization will have to pay in favor of the recognized employee (Part 4 of Article 19.1 of the Labor Code of the Russian Federation) the costs of paying for all benefits, guarantees and compensation provided for by labor legislation.

In accordance with Part 3 of Art. 5.27 of the Code of Administrative Offenses of the Russian Federation, substitution of labor relations for civil law ones is punishable by a fine:

1. for officials in the amount of 10,000 to 20,000 rubles;
2. for individual entrepreneurs from 5,000 to 10,000 rubles;
3. for organization – from 50,000 to 100,000 rubles;

In addition, there is liability for repeated violations;

1. disqualification of an official for a period of 1 to 3 years;
2. for individual entrepreneurs from 30,000 to 40,000 rubles;
3. the organization is subject to a fine of 100,000 to 200,000 rubles.

According to current legislation, an organization has the right to determine for itself which agreement it needs to use: labor or civil law. Approach this choice very responsibly; you should not take risks if your specific situation actually involves labor relations. If you are concluding a contract, then try to take into account all its nuances not only in the contract itself, but also actually try to comply with them.

Can a contract be recognized as an employment contract?

A work contract may be recognized as a labor contract if it has signs of such. In particular, if the contract specifies:

• operating mode;
• the procedure for granting days off and vacation;
• the obligation to comply with internal labor regulations;
• disciplinary sanctions for absenteeism, being late for work, non-compliance with labor safety standards.

In addition, a contract can be recognized as an employment contract if the remuneration was paid twice a month, the contractor underwent instructions and medical examinations, has a pass to the organization, was appointed as a financially responsible person, was reimbursed for business trips, and was allocated a workplace.

Important! To recognize a contract, a combination of the specified characteristics is required. The more there are, the greater the chance that the court will decide that in fact there was an employment contract, and not a work contract.

A civil law contract is

Under a civil law agreement, an organization engages a specialist, as an individual, to perform work or provide services without registering him as a member of the organization’s staff.

Typically, a civil law agreement (CLA) is understood as:

• a contract when an individual performs any work that has a tangible result.
• a contract for the provision of services for a fee, when an individual carries out instructions, actions, the result of which does not have a material form.

In addition, the Civil Code in paragraph 3 of Article 421 allows the conclusion of contracts that contain elements of various types of contracts. This is possible when a specialist performs a task that consists of some actions and a result that has a materialized form.

Dismissal under a contract

The term “dismissal” is used for labor relations, so it is not entirely correct to use it in relation to a contract. The contract agreement specifies the start and completion date of the work (Clause 1, Article 708 of the Civil Code of the Russian Federation). In this case, the customer can terminate the contract at any stage of their implementation. In this case, he is obliged to pay a certain percentage of the cost of work specified in the contract according to the volume of work performed. He must also compensate the contractor for losses - based on the difference between the cost established by the agreement and the completed part of the work (Article 717 of the Civil Code of the Russian Federation).

Unlike an employment contract, a contract agreement, unless otherwise specified in the contract, does not imply the need for the contractor to warn the customer 2 weeks in advance of his intention to terminate cooperation; accordingly, he is not obliged to work out anything before leaving.

Household contract

This agreement is aimed at fulfilling any needs of citizens and therefore, in content, is as close as possible to a service agreement.

Sometimes they try to replace this agreement with a contract of employment when applying for a job or the already mentioned contract for the provision of services, but this is unacceptable

The customer here can be either an individual or a legal entity.

The contractor is only the person who carries out business activities for this type of work.

What must be specified in the contract

• Full name of the customer and full name of the contractor (name of the company and the person signing the contract on behalf of the company).
• The subject of the contract is the result of the work that the customer receives as a result;
• The cost of order execution is the price written in the contract and cannot be higher than that established or regulated by government agencies.
• If the customer tries to introduce conditions for a higher cost into the document, they will be of little significance ( Article 735 of the Civil Code of the Russian Federation
  ).
• Deadlines for the execution of work - it is necessary to indicate the beginning and end of work under the contract (otherwise the paper may be declared invalid (Art. 708 clause 1 of the Civil Code of the Russian Federation
  )).

  Deadlines must be agreed before signing the paper or at the time of designing the task, but they can be changed in the following cases:

• significant violation of the terms of the contract by one of the parties to the contract ( Article 450 of the Civil Code of the Russian Federation
  );

significant change in circumstances ( Article 451 of the Civil Code of the Russian Federation
);

• the customer may request that work be completed ahead of schedule during the reorganization of the contractor ( Article 60 of the Civil Code of the Russian Federation
  ).

Agreement annexes

• Technical task;
• calendar plan;
• equipment list;
• list of materials;
• estimate.

Documents attached to the contract

• Documentation acceptance and transfer certificate;
• equipment acceptance certificate;
• protocol of disagreements;
• additional agreement;
• Protocol for reconciliation of disagreements.

Deadlines for filing claims under the contract

If deficiencies are discovered, claims can be made against the contractor:

• for real estate – for 5 years;
• for services – for 2 years.

Essential terms of the agreement

Subject of the agreement

At this point, you must not just write “repair and decoration of the balcony,” for example.

You need to carefully describe point by point what you want to see, right down to the hidden screw heads.

The more specificity is indicated in the “essential terms” clause in a household contract, the less likely it is that the contractor will try to leave something out by making the excuse that it is not in the contract.

Terms of work

Here it is necessary to indicate not just the beginning and end of the work being carried out.

At this point, just like in the past, it is necessary to very carefully write down all the work in stages: the beginning and end of each stage of work, which must be done within the specified time.

Payment

Payment can be made in advance and upon completion of the work, but it is better to tie the payment to the staged deadlines, then in the event of termination of the contract you will not have to sue for the money overpaid for defects.

Responsibility of the parties

In this paragraph you must write:

• that deviation from the work schedule may cause termination of the contract;
• what consequences may result from misrepresentation of information by the contractor.