In October 2022, the Client approached our team with a request to represent his interests in a labor dispute in the Kyiv Court of Appeal.
The complexity of the case was that the court of first instance made a decision by which the claim of the former head of the subsidiary company against the parent company was satisfied – the salary arrears and other payments were collected.
The court of first instance upheld the claim based on the fact that the director of the subsidiary entered into a contract with the parent company, and therefore the parent company, as a party to the contract (employer), is the proper defendant in the case.
Therefore, the Parent Company is entrusted with the obligation to make a full settlement with the plaintiff upon dismissal.
Disagreeing with this decision of the court of first instance, our team filed an appeal.
The team of the Law firm “Bauman Kondratyuk” , building a defense strategy in the case, drew the attention of the Court of Appeal to the fact that the Parent Company is not the proper defendant in the case.
The basis of the appeal was our statement that the hired manager (plaintiff) is by his nature a member of the labor team, but unlike other employees, taking into account the duality of his status and subjection to both labor and economic law, the contract with him is concluded by the owner of the enterprise .
In addition, our team analyzed the relationship between the parent company and the director of the Subsidiary through the prism of the tax and corporate legislation of Ukraine: requests were sent to the Pension Fund of Ukraine, the State Tax Service of Ukraine to obtain evidence in favor of our client.
During the trial of the case, we drew the attention of the Court of Appeal to the legal positions of the Supreme Court in similar cases:
In the aforementioned rulings, the Supreme Court made a general conclusion that the sole participant (founder) of a subsidiary is only the controlling and founding body of such a subsidiary, and therefore should not be held responsible for the subsidiary’s non-payment of wages to its employees.
Ruling of the Supreme Court dated May 20, 2020 in case No. 556/767/16-ts;
Ruling of the Supreme Court dated June 10, 2019 in case No. 759/5141/16-ts;
Ruling of the Supreme Court dated February 12, 2020 in case No. 295/16796/15-ts;
Ruling of the Supreme Court dated May 20, 2020 in case No. 556/767/16-ts;
Ruling of the Supreme Court dated June 10, 2019 in case No. 759/5141/16-ts;
According to the results of the review, our appeal filed in the interests of the client was satisfied, the decision of the court of first instance was canceled.
Attorneys Association “Bauman Kondratyuk” has been representing clients in various labor disputes for many years: disputes regarding the completion of public service, disputes arising between the owners and management of the enterprise, disputes about reinstatement, and other categories of labor disputes.
Our team is always ready to perform an in-depth expert analysis of a labor dispute and successfully represent clients’ interests in court.