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Russian Trade Unions Note High Popularity Of Illegal Pay Practice

Hands Holding Open Envelope Filled With CashMoscow, 6 April: Illegal pay practice is becoming increasingly widespread in Russia and currently accounts for about one-half of all salary payments in the country, the chairman of the Federation of Independent Trade Unions of Russia, Mikhail Shmakov, has said. "According to our estimates, the proportion of grey wages stands at about 50 per cent of the total pay amount. This effectively results in a shortfall in tax payments and at the end of the day affects the protection of employees," Shmakov said at today's meeting of the federation's general council.

He said that "the proportion of wage payments taken by shadow pay practices has risen in the past few years".

According to earlier reports and estimates by Rosstat (Russia's federal statistics agency), the grey economy currently accounts for 16 per cent of GDP and employs about 13m people. (passage omitted)

(Interfax news agency, Moscow, in Russian 0913 gmt 6 Apr 11 quoted Shmakov as saying at the same meeting that the national employment market had stagnated. "We have noticed a slow pace of job creation in the real sector of the economy. Despite all measures, the employment market has stagnated," he said. Shmakov also said that Russia's employment market was oversaturated with low-skill and low-pay jobs. "We have been told that the crisis is over. But we have continued to witness growth in public utilities and housing tariffs and inflation. Two-thirds of the country's population currently care more about the price of a product than about its quality," he said.)

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