Russia

Worker Protection and Benefits

Legislation has established numerous protective devices at the enterprise level to provide a social safety net that is particularly attuned to the needs of women of childbearing age. Thus, family policy and employment policy are inextricably linked. In addition to basic allowances for all workers, special allowances exist for children of military personnel, children with unmarried, divorced, or widowed mothers, and children who are disabled. Women who have an employment contract are entitled to paid maternity leave from seventy days prior to giving birth until seventy days afterward. Maternity leave benefits are based on the minimum wage rather than on a woman's current wage, however.

Russia also provides a maternity grant, which is a onetime payment totaling three times the minimum wage or 45 percent of the minimum wage in the case of mothers who have worked less than one year. In order to receive a maternity allowance (or sickness benefits), a woman must have an employment contract. The maternity allowance amounts to 100 percent of the mother's salary, regardless of her length of employment.

Maternity allowances in Russia are followed by a monthly child allowance of 80 percent of the minimum wage in the case of children up to eighteen months old. This allowance may be supplemented by a child-care allowance, set at 35 percent of the minimum wage, to compensate for earnings lost in the course of caring for children in this age bracket. The latter allowance is paid to mothers over the age of eighteen who have been in the labor force at least one year. An additional compensatory child-care allowance, equivalent to 35 percent of the minimum wage, is available to mothers or other caretakers of children under the age of three.

Russia also has an extended child allowance of 45 percent of the minimum wage (60 percent for children of military personnel, children living with a guardian or in an orphanage, and children with AIDS) to assist families with the care of children between the ages of eighteen months and six years. Single mothers and those who receive no child support from the father of their child may obtain an additional 45 percent of the minimum wage up to their child's sixth birthday; this figure is then increased to 50 percent and remains effective until the child is sixteen. In May 1992, special cost-of-living compensations were introduced to cover the increased expense of meeting children's basic needs. These compensations ranged from 30 percent of the minimum wage in the case of children less than six years old to 40 percent in the case of those ages thirteen to sixteen.

Among other benefits provided by enterprises to their workers are access to special shops that sell subsidized milk for families with low incomes and small children and an allowance to children for the purchase of a school uniform when they start school and again at the age of thirteen. Other regulations focus more specifically on families with small children. These include protective legislation prohibiting the dismissal of pregnant women or women with children under the age of three, banning night work and overtime for mothers of small children, stipulating workload concessions to pregnant women and mothers of young children, and providing flextime, part-time work, home-based employment, nursing intervals, and additional paid and unpaid leave to mothers to care for sick children. Many workplaces also permit informal leave arrange-ments for the purpose of food shopping.

A significant portion of Russian workers have entitlements to housing, child care, and paid vacations, regardless of their rank within an enterprise. Housing entitlements involve either outright provision of a low-rent apartment (most apartment rents are very low) or various forms of cash or in-kind assistance. Moreover, occupants obtain an implicit ownership right extending beyond their term of employment. They may also have the legal title of the apartment transferred to their own names without paying any purchase price (see Housing, this ch.).

Besides housing allowances, most large and medium-sized enterprises provide on-site medical facilities or they contract for outside health care facilities for their employees. The medical care provided through the auspices of enterprises is free and often is of much higher quality than the care available in government-run facilities (see The Health System, this ch.). Finally, enterprises provide their employees with goods ranging from foodstuffs to consumer durables. The enterprises procure these items through direct purchase, barter, or from their own farms, and make them available at below-market prices.

The Social Insurance Fund is the administrative mechanism for payments to workers of birth, maternity, and sickness allowances, and child allowances for children between the ages of six and sixteen. The fund is managed by the largest union organization in Russia, the Federation of Independent Trade Unions of Russia (Federatsiya nezavisimykh profsoyuzov Rossii--FNPR) and serves as the repository of enterprise contributions consisting of 5.4 percent of the total payroll (see Social Organizations, this ch.). Nominally an independent institution since its establishment in 1991, the Social Insurance Fund is in fact responsible to the FNPR.

In 1993 an overhaul of the fund's administrative structure began as a result of enterprises' low levels of compliance with contribution requirements, charges of serious abuse by trade union officials, and the government's desire to promote democratic accountability. Since 1993 the management system has been in flux, and the quality of administration varies considerably throughout the country. Most worker contributions to the fund are retained by the enterprise for distribution. About one-half of the money goes to sick pay and one-fifth to subsidize treatment at sanatoriums. Family support includes birth and maternal allowances intended to replace lost wages, but child allowances do not address poverty directly because payments are not in proportion to household income.

Russia also has an overall system of family benefits. These can be grouped into three broad categories: those payable to all families with children, regardless of income or other qualifying conditions; those payable to working mothers; and those payable to disadvantaged families.

The communist system, for all its economic and moral deformities, provided virtually universal employment, so that every able-bodied citizen had an opportunity to earn income and thus social security. In postcommunist Russia, the phenomenon of unemployment is openly acknowledged and growing (see Unemployment, ch. 6). At the end of 1995, some 8.2 million people were registered as unemployed, indicating a far higher actual number. Three years earlier, about 5 million were registered. The "new poor," in the parlance of the World Bank, put a considerable strain on the resources available in Russia for social welfare.

Administered by the Ministry of Labor, the Employment Fund, which is financed by a 2 percent payroll tax from all enterprises, disburses compensation to jobless people. The level of compensation, already low in 1995, was expected to drop further if unemployment rose. As part of its assistance package to Russia, the World Bank is providing a computerized system that will help the country register claimants for unemployment and pay adequate benefits.

The Ministry of Labor's subsistence minimum is based on the cost of nineteen staple items considered sufficient to ensure survival, plus an estimated minimum cost for utilities, transportation, and other necessities. The calculation varies according to age-group and region; trade unions use other formulas that usually expand the number of people identified as living below the poverty line. In early 1996, the State Duma considered a law that would make the Ministry of Labor's figure the legal basis for establishing minimum wages, pensions, and other levels of social support. Barring such legislation, the subsistence minimum has no legal status.