Finding “Protection” from Your Employees

About 2 weeks ago or so I got an interesting e-mail from one of the readers of my blog who asked me about measures that could be taken by employers under the Moldovan legislation to protect themselves from “employees walking away from positions (normally of in-depth knowledge of confidential business information but also as straightforward as taking part of the customer-base with him out of the door) and taking up either employment with competing businesses or setting up a competing business”.

I told him that this problem affected many companies (both local and international ones) and promised to touch upon this subject in my blog. And now (though with some delay) I decided to keep my word and to post on that issue and try to investigate it, even in a little broader context than we have discussed it.

What is the essence of the problem?

First of all, let me outline the main hot problems relating to the discussed issue. When you hire a person you usually do the following things (in different combinations and proportions, of course): teach him the way how the work is done (particularly, if you deal with the beginners), provide different training and study opportunities, i.e. you make investments into your employees hoping that those investments would bring certain benefits to your company after a time. And certainly you don’t want people being taught by you leave you immediately after this, for instance, being hired by a competitor company.

Or we may take another example that represents a more serious problem. You’re left by an employee who had access to some insider information (no necessity to describe all possible consequences).

In other words you don’t want to “cherish a snake in your bosom” (NB. Is this proverb has the same meaning as it has in Russian?)

So, are there any ways to feel yourself protected in such situations or at least to diminish possible damage? This is the topic of my today’s post.

Whose side does the law take?

The modern Moldovan labour/employment legislation inherited to a considerable degree many Soviet traditions in providing to employees all possible and impossible means of protection of their rights. The laws (and most of all the Labour Code) regulating the labour relationships between employees and their employers set a row of very strict rules that all employers (regardless of type of ownership – the public or private one) must observe. And although the law stipulates certain provisions to protect employers from illegal actions and abuses of rights from the part of employees the general spirit of the labour legislation is likely to be called pro-employees.

The same situation may be observed in courts. With all things being equal you have very little chance of winning a case if you are an employer.

Anyway, you have to meet all these challenges and use all possible means provided to employers by law. Let’s look at some of them…

Long-term retention of your employees: is it possible?

One of the questions that are most frequently asked by employers is how to make their employees to work for them during the long periods of time. The question easy to understand but hard to answer.

Articles 43 and 44 of the Moldovan Constitution provide to every person in Moldova the right to a free choice of labour and set the prohibition of forced labour. Many lawyers consider the employment contracts terms limiting the right of an employee to resign at any moment as infringement of the aforementioned Constitutional principles. Moreover, employees can’t relinquish their rights under art. 64 para. (2) of the Labour Code that declares invalid any agreement that is directed to renunciation or limitation of employees’ rights.

According to art. 54 of the Labour Code the labour contracts are usually concluded for unlimited periods of time. This rule was stipulated in order to complicate ungrounded dismissals using the terms of contracts containing the period of their validity. So, this provision is intended to bring certain stability for employees and to make their position more secured in the face of changeable mood of their employers. Article 55 of the Labour Code provides a number of cases when the labour contracts are permitted to be signed for certain fixed periods of time (but for no more than 5-years terms) for carrying out the works that have a temporary character.

But what if you wish to sign a contract providing that your employee would be bound to work for you not less than for a period of time stipulated in the contract (e.g., not less than 2 years)? Such situation is not foreseen in arts. 54 and 55 of the Labour Code mentioned above. The contract in this case is signed in fact for an unlimited term (because employees may work 5-10-20 years, BUT not less than 2 years) and provisions of arts. 54 and 55 are observed.

Moreover, para. (3) of art. 6 of the Labour Code stipulates that nobody can be forced to work at a certain place of work during his entire life. Does this rule mean that it is permitted to set in employment contracts the obligatory terms for employees for the periods less than “entire life”? I’d like to think so, BUT…

Article 85 of the Labour Code provides that an employee has the right to resignation that is the right to dissolve a labour contract signed for an unlimited period of time. And there are no exceptions to this rule. The only obligation for employees in this case is to inform the employer about the resignation 2 weeks in advance. This is the right of employees stipulated by the Code and as I have already mentioned they “don’t have the right to give up this right”.

So, as we can see the Moldovan legislation does not provide a possibility for employers to hold their employees on their positions and to not let them go…

If employers don’t have the right to retain employees for certain fixed terms can there be any other means to secure their interests? This is the question that I’m going to answer in the next post here in my blog. To be continued…