The head of an NGO without a salary: is it possible?
Zh-l "Wages", No. 5, May 2017, p. 58-61.Question: Currently, many public organizations have appeared, many condominiums are being registered. I am interested in the question: can the head of an NGO be without a salary? There is such a concept as "work on public grounds". What it is? Can the head of an NGO work on public grounds" without a salary? Does this apply to condominiums?
Answer : According to Article 83. According to the Civil Code of Ukraine, legal entities can be created in the form of companies , institutions and in other forms established by law. A company is an organization created by uniting persons (participants) who have the right to participate in this company. A company can be established by one person, unless otherwise established by law. At the same time, companies are divided into business and non-business .
According to Article 85 of the CCU, non-entrepreneurial societies are societies that do not aim to obtain profit for its subsequent distribution among participants. Peculiarities of the legal status of certain types of non-entrepreneurial societies are established by law.
Article 86 of the CCU also mentions citizens' associations among non-entrepreneurial societies.
Civil capacity is the ability of a person to acquire rights and obligations through his actions. According to Article 92 of the CCU, a legal entity acquires civil rights and obligations and exercises them through its bodies , which act in accordance with the founding documents and the law. The procedure for creating bodies of a legal entity is established by the founding documents and the law. At the same time, Part 4 of Article 92 of the CCU, regulating relations regarding the responsibility of the body of a legal entity, directly indicates that these relations are a representation .
It should be recalled that Article 237 of the CCU defines representation as a legal relationship in which one party (representative) is obliged or has the right to perform an act on behalf of the other party it represents. At the same time, the grounds for the emergence of such a legal relationship are a contract, a law, an act of a body of a legal entity and other grounds established by acts of civil legislation . That is, as can be seen from the above legal norms, a person acquires the authority of a manager/representative of a legal entity, including an association of citizens, based on the norms of civil, not necessarily labor legislation. At the same time, the CCU does not establish the obligation to encumber this legal relationship with an employment contract. Therefore, the head of an association of citizens (public organization, non-entrepreneurial society...) is not obliged to enter into labor relations with such an association of citizens. In the same way, the association of citizens is not obliged to do this. And it seems even more logical if the functions of the head of a citizens' association are performed by a member of such an association.
Regarding other legislation, it should be noted that Article 3 of the Economic Code of Ukraine indicates that economic activity can be carried out without the purpose of obtaining profit (non-commercial economic activity). In accordance with Article 52 of the GCU, non-commercial economic activity may be carried out by economic entities that are prohibited by law from conducting economic activity in the form of entrepreneurship.
Article 54 of the GCU applies to economic entities that carry out non-commercial economic activity, general requirements regarding the regulation of economic activity, taking into account the peculiarities of its implementation by various economic entities, which are determined by the GCU and other legislative acts. When concluding an employment contract (contract, agreement), a business entity that carries out non-commercial economic activity is obliged to ensure proper and safe working conditions, its payment is not lower than the minimum amount determined by law, and also to provide other social guarantees provided for by law. Therefore, labor relations between the association of citizens and its volunteers/participants may arise, but do not necessarily arise. And only in the case of their occurrence, the obligation to comply with the norms of labor legislation arises.
The Law of Ukraine "On Public Associations" dated March 22, 2012 No. 4572-VI is a special law regulating relations with citizens' associations. According to Article 1 of this Law, a public association is a voluntary association of individuals and/or legal entities of private law for the exercise and protection of rights and freedoms, satisfaction of public, in particular economic, social, cultural, environmental, and other interests. According to the organizational and legal form, a public association is formed as a public organization or a public union.
In accordance with Article 9 of the said Law, the formation of a public association is carried out at the founding meeting of its founders and is drawn up in a protocol, which must also contain information on the decision on the formation (election) of the head and management bodies of the public association in accordance with the approved statute. It is clear that the same information must be contained in the charter of the public association itself, as well as information about the powers of the manager, the highest management body, and other management bodies (Article 11 of the said Law).
As can be seen from the above legislation, labor relations with respect to public organizations and their managers are not stipulated by the legislation as mandatory. It should be recalled the "constitutional axiom" that the legal order in Ukraine is based on principles according to which no one can be forced to do what is not provided for by the law (Article 19 of the Constitution of Ukraine).
Therefore, the current legislation does not prohibit the head of a public association to "work on public grounds ." Although this concept is commonly used, it is not legally defined. On the basis of its analysis of various regulatory documents, the FSSU considers it possible to highlight the following characteristics:
" first of all, the norms of labor legislation do not apply to work on public grounds. This statement stems from the contrast in legislation regarding employees who work under an employment contract and on public grounds. Example:
- assistants-consultants of the people's deputy work under a fixed-term employment contract on a permanent or part-time basis or on public grounds (part three of Article 34 of Law No. 2790);
- members of the population self-organization body perform their duties on public grounds. According to the decision of the meeting (conference) of residents at the place of residence, the head and secretary of this body can work in it on a permanent basis with payment for their work at the expense of funds transferred to the body of self-organization of the population (Article 21 of Law No. 2625);
- members of the supervisory board work on a public basis, and they cannot be persons who are in labor relations with the credit union (part three of Article 15 of Law No. 2908);
secondly, the work is done free of charge. This conclusion also follows from the first sign;
thirdly, the work is carried out, as a rule, in free time from other paid work;
fourthly, the specified work is performed not on the basis of an employment contract (when the position is added to the staff list), but on the basis of special powers. Let's dwell on the latter in more detail. For example, according to clause 3.2 of decision No. 1-рп/2010 , the basis for the acquisition of powers by the executive body of the company is the fact of its election (appointment) by the general meeting of participants (shareholders) as the highest management body of the company, or in accordance with the fifth part of Art. 58 of the Law on joint-stock companies, concluding an employment contract with a member of the company's executive body, which can be signed on behalf of the company by the chairman of the supervisory board or a person authorized to do so by the supervisory board. It should be noted that a new version of this norm entered into force on March 2, 2011 (amended by Law No. 2994 ) , which is not about an employment contract, but about concluding a contract with each member of the executive body. And since the contract is a special form of an employment contract, the content of this norm has hardly changed " ("Bulletin of the FSSU. Officially about taxes. August 1, 2014, Friday, No. 29-30 (29-30) .
Therefore, from the given point of view of the FSSU, the conclusion about the legality of the existence of only civil-law relations between the public association and its head and about the lawfulness of the absence of labor relations between them follows quite logically.
And from this follows the answer to the question: the head of a public association can "work on a public basis", i.e. without a salary. The public association's obligation to comply with labor legislation in such relations, including the obligation to pay wages not lower than the minimum amount, arises only in the event that they conclude an employment contract.
Regarding condominiums.
According to Article 1 of the Law of Ukraine "On Association of Co-owners of an Apartment Building" dated 29.11.2001 No. 2866-III , an association of co-owners of an apartment building is a legal entity created by the owners of apartments and/or non-residential premises of an apartment building to promote the use of their own property and management, maintenance and use of common property . And in accordance with Article 4 of the same Law, a condominium association is created as a non-entrepreneurial company to perform the functions defined by law. It is a non-profit organization and does not aim to obtain profit for its distribution among co-owners.
Article 10 of the specified Law states that the governing bodies of the condominium are the general meeting of co-owners, the board, and the audit commission of the condominium. The highest governing body of the condominium is the general meeting. A board is elected to manage the current activities of the condominium. It is the executive body of the condominium and is accountable to the general assembly.
As can be seen from the above, there is no question of the mandatory emergence of labor relations between the condominium and the board. And in general, there is not a word in this Law on labor relations.
Therefore, the members of the board of condominiums, just like the heads of public associations, have the right to "work on a public basis", and condominiums, just like public associations, have the right not to pay wages and they bear no responsibility for this.
Date of publication: 25.11.2017