GPC agreement with an individual: pros and cons for the employee

Employment contract - a written agreement between an employee and an employer, which specifies the rights and obligations of each party. The employer guarantees the employee a place to work, timely salary and conditions that comply with the Labor Code of the Russian Federation. And the employee, in return, fulfills his direct work responsibilities and follows the company’s rules.

GPC agreement (decoding - civil law) - an agreement between the contractor and the customer, under which they do not enter into an employment relationship. This agreement defines the work and its result, for which the performer receives remuneration. Examples of a GPC agreement: contract, provision of services, author's agreement.

Subject of the contract: labor function / result

The subject of labor relations is the personal performance by an employee of his direct work duties for a salary . The labor function is defined in job descriptions in accordance with the qualifications and specialty of the employee. This is a workflow that runs every working day.

The subject of civil law relations is the result of the work or service of the performer . The customer must receive and accept the result within the period specified in the contract. In this case, the work process itself is not important for the customer, although, if desired, he can establish intermediate control.

The contract specifies a list of works that the contractor must complete within the agreed period. The contractor may involve other performers in the task if the contract does not provide for independent execution.

The basis on which the contractor receives remuneration is a bilateral act of work performed.

3. Documentation: work book or contract

To begin an employment relationship with an employee, you need to prepare a number of documents :

employment contract;
employment history;
personal card;
hiring order.

To work with a contractor, you only need to enter into a written GPC agreement . Each party leaves signatures on it. After the end of cooperation, the contract is closed with an act of completion of work (services rendered).

Distinctive features of an employee employment agreement

The main differences between a employment contract and an employment contract are as follows:

the employee who signed the employment agreement performs clearly regulated job duties, while the hired employee only performs certain ones and is not subject to the provisions of the internal regulations;
legally established relationships oblige the employee to submit to higher management, the parties to the employment contract are conditionally equal;
wages to an employee are paid by agreement of the acting parties. The employment relationship obliges the employer to pay remuneration twice a week or more often. What are the rules for calculating payroll tax - read the link;
a contract of employment provides for the performance of a specific task or work. An employee with a formalized employment relationship undertakes to perform the functions provided for by job obligations;
The “expiration” period of an employment contract is indicated only in rare cases, while hiring presupposes a clearly defined duration.

It is important to know! An employment contract provides for the protection of the employee’s rights, but hiring deprives the citizen of certain social guarantees.

Strengths and weaknesses of the contract

Why is it beneficial for an employer to have an employee?

The employee is responsible for organizing the required conditions to complete the assigned task. The duration and place of execution are also chosen by the “mercenary”.
The manager is exempt from paying taxes to the Social Insurance Fund.
The employer does not comply with the guarantees provided for by the provisions of the Labor Code of the Russian Federation.
The manager is exempt from paying social insurance contributions.
Material remuneration is paid after completion of the work, and the amount is fixed at the stage of drawing up the relevant paper.

Disadvantages for a manager

The performer is not subject to internal regulations. There are no clear regulations for the work carried out, since the final result is important.
The result of the trial is the reclassification of the contract into an employment contract if the relationship between the employee and senior management is determined.
Illegal business activity threatens an employer who has signed an employment agreement with an individual.

It is important to know! The activities of the contractor, in the majority, are regarded by regulatory authorities as entrepreneurial.

Mutual responsibility of the parties: employer and employee, customer and contractor

The employer is obliged to make the following payments in favor of the employee:

average earnings for the period during which he was illegally deprived of the opportunity to work;
compensation for damage to health and property;
compensation for moral damage
interest for late wages.

The employee, in turn, bears financial responsibility to the organization within the framework of his monthly earnings. For violation of discipline, he may be subject to a reprimand, reprimand or dismissal.

The customer of work or services is obliged to compensate the contractor for losses caused by improper performance of duties. The performer is responsible to the customer in the same way.

The contractor cannot be brought to disciplinary liability.

Internal labor regulations

Each full-time employee works at a time agreed with the operating hours of the organization itself . Therefore, he is obliged to work according to the company's rules. Come and leave work at the appointed time, have lunch and rest, and take technical breaks. Absence from work without a good reason is permitted only on non-working days: holidays and weekends established by the staffing schedule.

The full-time employee remains under the control of the employer throughout the working day.

Persons working under GPC agreements are not required to obey the customer’s internal rules . They do not obey the officials of the organization and its regulations.

The contractor can work at night, when the entire staff of the organization is resting, and sleep well during working hours. Weekends also do not affect the work process in any way. The main thing is to submit the result of the work on time.

Working conditions: workplace and materials

According to the employment contract, the employer provides the employee with proper working conditions . It highlights the work area, computer, tools, uniform, materials and instruments. Conducts safety training.

According to the GPC agreement, the customer is not responsible for the contractor’s workplace . The contractor himself selects and equips his workplace. The customer can transfer tools and materials for the work to the contractor, and then this is written in the contract. If there is no such clause in the contract, the contractor works with his own tools and materials.

Contract term

In our case, the period is indefinite, therefore, in the clauses of the contract it is stated “for an indefinite period.” This paragraph also indicates the date from which the citizen begins his work duties:

This employment contract is concluded for an indefinite period and comes into force from the moment of its signing. The Employee’s start date for performing his work duties is May 4, 2023. The probationary period is 14 (Fourteen) calendar days.

Remuneration: regular or one-time

Employees on staff regularly receive salaries in the agreed amounts . According to the rules of the Labor Code of the Russian Federation, salaries must be transferred at least twice a month - an advance payment and the main part. For failure to comply with payment deadlines, the employer issues compensation to the employee. It is charged for each overdue day as 1/300 of the refinancing rate.

If an employee works properly and fully performs his functions, he cannot be paid a salary below the minimum wage. In 2020, the minimum wage increases to 12,130 rubles.

Employees under a GPC contract will receive remuneration when they provide the customer with the result of the work performed . So the contractor can receive payment even once every six months, if such a period was required to complete the order.

The GPA can include the delivery of work in stages or the payment of advances. Then the customer will pay regularly, after accepting part of the work performed.

Personal income tax and insurance premiums

The employer acts as a tax agent in both cases . He withholds and pays 13% to the tax office on a monthly basis from the salaries of employees working under any type of contract.

This does not apply to contracts concluded with individual entrepreneurs. Entrepreneurs pay taxes themselves. To avoid tax claims, ask the individual entrepreneur for documents about his status.

Both types of employees may qualify for tax deductions. True, contractors can apply to the customer for it only while the contract is in force.

For employees under an employment contract, the employer pays monthly insurance contributions in the amount of 30% of the salary - to the Pension Fund of the Russian Federation, the Social Insurance Fund and the Federal Compulsory Compulsory Medical Insurance Fund. Additionally, he is obliged to transfer contributions for insurance against accidents and occupational diseases at the rate applicable to the organization.

For employees under a GPC agreement, contributions must also be paid, but in a smaller amount . Contributions to the Social Insurance Fund in case of temporary disability or maternity are not accrued, and contributions for injuries are paid only if this is provided for in the contract. So 27.1% of the salary is transferred to the Federal Tax Service.

Contributions to the Pension Fund are paid in any case, and under any agreement, the pension savings of the employee or performer grow.

Working under an employment contract without a work book

The disadvantages of working without a book are much greater than the advantages. A definite advantage for the employer can be considered the almost complete absence of formalities and bureaucratic difficulties. The citizen receives relative freedom when performing a task, including the absence of inclusion in the hierarchical system of the enterprise. When drawing up a GPC agreement, it is much easier to terminate the relationship, which can be considered both pros and cons, depending on the situation (although here, too, you need to be careful and comply with the requirements of Article 310 of the Civil Code of the Russian Federation).

Disadvantages of not having a work book under a GPC agreement:

vacations and sick leave are not paid, vacation is not provided at all, this is an element of the labor relationship;
insurance contributions are not deducted, as a result of which the employee’s guarantees are reduced;
lack of incentive and compensation payments, including bonuses;
lack of liability of the employer in case of industrial injuries (if the damage is not caused by the fault of the customer).

Some experts mistakenly consider various types of civil law contracts as work under an employment contract without an entry in the work book. This is incorrect, since agreements of this type are purely civil in nature. Accordingly, the employer does not have to issue a book. For example, this applies to contracts for the provision of services or author's orders.

However, the Labor Code of the Russian Federation provides for three cases of concluding an employment contract without recording in the work book:

registration of part-time work;
remote employment;
the employer is an individual.

GPC and employment contract - the difference in the table

Here is a summary table: we have identified the parameters by which the two types of contracts differ from each other. Compare and decide when to enter into an employment contract and when to work according to the Civil Code.

Comparison options	GPC agreement	Employment contract
Legislative regulation	Civil Code.	Labor Code.
Parties to the agreement	Performer and customer.	Employee and employer.
Subject of the agreement	The result of work or provision of service.	Personal performance of work tasks.
Third parties	The contractor may involve subcontractors in the work unless the contract prohibits this.	The employee must personally perform work duties.
Documenting	All you need is a written agreement.	You need to prepare a hiring order, make an entry in the work book, and issue a personal card.
Operating mode	The contractor determines it himself and does not coordinate with the organization’s working hours. The result must be delivered to the customer within the specified time frame.	Established by local documents of the organization. The employee is obliged to comply with it. Additional pay is required for working overtime, weekends and holidays.
Working conditions	The terms of the contract indicate whose materials and tools the performer uses. They can be either your own or the customer’s.	The employer provides all working conditions: place of work, machinery and equipment, uniforms, materials and tools.
Payment for work	The contractor receives remuneration after transferring the result of the work to the customer. The contract can specify advances or delivery of work in several stages.	The employee receives a salary at least twice monthly. The monthly salary cannot be lower than the minimum wage if the employee performed his duties properly.
Taxes and fees	13% personal income tax and contributions to the Pension Fund and the Federal Compulsory Medical Insurance Fund. Not counting the GPC agreement with the individual entrepreneur.	13% personal income tax and 30 insurance contributions from salary to the Social Insurance Fund, Pension Fund and Federal Compulsory Medical Insurance Fund.
Labor guarantees	There are no labor guarantees provided for by the Labor Code of the Russian Federation. The period of work on the GPA is taken into account when determining the length of service, and the pension increases during this time.	A full-time employee receives all compensation and guarantees provided for by the Labor Code of the Russian Federation.

What is an employment contract and why is it needed?

An employment contract is the main document on the basis of which the relationship between an employee and an employer is built.
As stated in the article of the Labor Code of the Russian Federation, within the framework of an employment contract, the employer assumes the responsibility to provide the employee with work, ensure safe working conditions, and also pay wages on time and in full. The employee, in turn, must personally perform a labor function under the management and control of the employer, as well as comply with internal labor regulations. Draw up regulations on remuneration and internal labor regulations using ready-made templates

An employment contract should be drawn up with each employee before he starts work (Article of the Labor Code of the Russian Federation). An article of the Labor Code of the Russian Federation prohibits requiring work to be performed that is not specified in the employment contract. This means that until the signing of a document that will reflect the type of work (position, specialty, job function) and the amount of payment, the employer, in principle, cannot demand anything from the employee.

ATTENTION

Involving employees in work without drawing up written employment contracts with them entails administrative liability. Penalties are: for individual entrepreneurs - from 5,000 to 10,000 rubles, for organizations - from 50,000 to 100,000 rubles (part 4 of article 5.27 of the Code of Administrative Offenses of the Russian Federation).

Draw up and print an employment contract

GPC agreement: pros and cons

A GPC agreement is more beneficial for the employer, since it is easier to formalize work with a contractor than to hire an employee. And the costs for this are lower. For an employee, a GPC contract, on the contrary, is inferior to a labor contract due to the lack of guarantees and compensation. Let's look at the features for each side.

GPC agreement: advantages for the employee

Ease of design . To work under the GPC, you do not need a work book, a medical examination or a package of documents. For registration, provide the customer with a passport, INN and SNILS.

Low management control . The performer himself chooses what time to work and what time to rest. The main thing is to get the agreed result on time. The customer can control the work step by step.

Also, according to the GPA, the performer does not obey internal orders and instructions from management.

You can work in several places . Thanks to a free schedule and registration without a work book, under a GPC agreement you can work in several places at the same time.

Continuous work experience . The customer transfers insurance premiums to the Pension Fund and Compulsory Medical Insurance. Work experience while working under the GPA continues to be taken into account.

Employment without qualifications . The contract stipulates the result and its level. At the same time, the contractor’s qualification level does not have to be met if this requirement is not specified in the contract.

Possibility to attract assistants . The contractor under the GPC agreement is not obliged to do all the work himself. He can delegate the work and part of his remuneration to subcontractors, but is obliged to provide a high-quality result. But the contract may require the task to be completed independently, in which case you will have to work on your own.

GPC agreement: disadvantages for the employee

Lack of records in the labor record . The work book of the GPC contractor remains empty, making it more difficult for him to confirm his work experience. To do this, you can show the new employer the GPC agreement, the certificate of completion of work and the characteristics from the customer.

Unprofitable vacation . The phrase “He who doesn’t work, doesn’t eat” applies to the contractor under a GPC agreement. He receives reward not for the work process, but for the result. Therefore, it is not so profitable to get sick, go on vacation and relax on weekends and holidays.

Difficulties with lending . If a performer works only under GPC agreements, banks are not always ready to issue him a loan or mortgage. The reason is that income cannot be predicted. If you find creditors, the percentage will not be as favorable as for workers under an employment contract.

Lack of social guarantees during pregnancy or illness . Employees under an employment contract are insured in case of temporary disability or maternity. In case of illness, the employer will pay benefits for the entire period of sick leave.

Full-time employees are also paid for temporary disability to care for a sick child or grandfather, during follow-up treatment after hospitalization, or for prosthetics.

Full-time employees receive all benefits provided by law in the event of pregnancy and childbirth. Their amounts depend on average earnings.

GPC performers are not paid sick leave. Pregnant employees under GPC contracts will not receive anything from the customer in excess of the contract amount. Benefits will have to be registered with the social security authorities, and their size will be minimal, even if, according to the contract, the monthly income was 300 thousand rubles.

Lack of average earnings . To calculate any social benefits, the employee’s average earnings over the previous two years are important. When working under the GAP, contributions to the Social Insurance Fund are not paid, which means that the employee’s remuneration does not increase the average earnings.

During the subsequent transition to an employment relationship, earnings during work under the GPA are not taken into account. Sick leave, maternity and other benefits will be less than that of colleagues.

Lack of compensation in case of bankruptcy of the customer . If the customer goes through bankruptcy proceedings, contract employees will not be able to be included in the number of creditors, unlike full-time employees.

Possibility of terminating the contract at any time . The customer may terminate the contract at any time without giving reasons. But the contractor has the opportunity to go to court and recover his remuneration if the work was completed but not paid.

Liability for damage and poor performance . Employees under employment contracts are subject to disciplinary and financial liability. Material is limited to average monthly earnings. And if the damage is caused by the performer, he compensates for it in full.

According to the GPA, the contractor is responsible for meeting deadlines, and violation of them is subject to a fine. If the result of the work suffers before the work acceptance certificate is signed, the contractor is also responsible for this.

Vulnerability in case of an accident . If during the work for which the contract is concluded, the contractor is injured, he will not be able to receive benefits from the customer for the duration of treatment. If your GPC work is traumatic, write down in the contract a provision for sick leave benefits in case of injury.

No bonuses under the collective agreement . The employer can assign additional payments to full-time employees that increase their comfort and loyalty. This is financial assistance, payment for trips to resorts, payment for treatment, compensation for mortgage expenses, a voluntary health insurance agreement, etc. GPC workers are deprived of all these bonuses.

As you can see, the GPC agreement has more disadvantages than advantages in comparison with an employment contract. But this does not mean that such design should be abandoned. Instead of social guarantees, you get independence, a free schedule and the opportunity to combine jobs. Because of this, many people prefer to work under contract contracts.

Advantages of the GPC agreement for the customer

Possibility to refuse to conclude a contract . An employer cannot refuse to employ a candidate if there is no reason to do so. Applicants cannot be screened out based on skin color, race, location or age. The only measure is the employee’s business qualities.

According to civil law, the customer can refuse any applicant as a contractor without explaining the reasons. For example, if a company does not want to work with people over 55 years of age or citizens without registration in the city.

Ease of termination of the contract . The employment contract is concluded for an indefinite period. This makes it difficult to fire an unwanted employee. You need to give notice of layoffs at least two months in advance, and you need to pay compensation during the period of searching for a new job.

The contract with the contractor under the GPC agreement is always concluded for a clear period; after this period, the contract does not need to be renewed.

Unlimited number of contractors . The number of employees under an employment contract is limited by the staffing table. If the employer’s staffing schedule is established by higher authorities, it cannot be changed arbitrarily. Therefore, you need to adhere to the limit.

The customer can enter into a GPC agreement with employees whose positions are not on staff. This means that an unlimited number of employees can work outside the organization.

Saving on insurance premiums . For employees under an employment contract, the employer is obliged to pay personal income tax of 13% and insurance contributions to the Social Insurance Fund, Pension Fund and Federal Compulsory Medical Insurance Fund - 30% of the salary. Plus, it is necessary to make contributions in case of work-related injuries and occupational diseases at the rate for the main activity.

With a GPC agreement you can save a lot. When working with individual entrepreneurs and self-employed people, the customer does not have to pay either personal income tax or contributions. And according to the GPC agreement with individuals, a personal income tax of 13% and insurance premiums are provided. There is no need to pay accident insurance premiums if this condition is not specified in the contract.

Savings on the social package . An employee under a GPC agreement only needs to pay for the result. During the period of his vacation, illness or maternity leave, no compensation needs to be paid. And significantly more money is spent on full-time employees.

Saving on workplace organization . Typically the contractor works remotely. Therefore, he does not need an equipped workplace, uniform and tools.

The customer purchases consumables and tools if this is specified in the contract. If there is no such condition, the contractor purchases at his own expense.

Disadvantages of the GPC agreement for the customer

Registration of relations under a GPC agreement for the customer is almost a complete advantage. You can save money and organize your work conveniently. But there is still a drawback - limited control.

It is more difficult to monitor a remote employee, and it is almost impossible to understand the progress of a task. There is a risk that you will wait six months and not get results. To avoid troubles, provide for stage-by-stage delivery of work in the contract.

Taxes for parties to a civil contract with an individual

What taxes will arise in a civil contract with an individual? Here, again, everything depends on the capacity in which (an ordinary individual or individual entrepreneur) the performer acts.

An ordinary individual (including an individual entrepreneur who enters into such an agreement as an ordinary individual) will be regarded as an employee registered with the employer under the GPA. And from his income the employer will accrue and pay:

Personal income tax (except for the situation when the employer is also an ordinary individual), withholding it from the employee’s income (clause 1 of Article 226 of the Tax Code of the Russian Federation);

If you have access to ConsultantPlus, see recommendations from K+ experts on how to calculate and pay personal income tax on payments under service and contract agreements with resident individuals. If you don’t have access, sign up for a free trial access to K+ and learn the procedure.

insurance premiums for compulsory health insurance and compulsory health insurance (such income is exempt from accrual of contributions to compulsory health insurance in terms of disability and maternity - subclause 2, clause 3, article 422 of the Tax Code of the Russian Federation);
insurance premiums for injuries, if such a condition is provided for in the GPA (Clause 1, Article 20.1 of the Law “On Compulsory Social Insurance...” dated July 24, 1998 No. 125-FZ).

How to calculate insurance premiums when accepting work under a contract with an individual who is not an individual entrepreneur, experts from the K+ system explained in the Contract Guide. Get free trial access to ConsultantPlus.

An ordinary individual who has entered into a GPA on his own will only have to pay personal income tax in a situation where his employer also becomes an ordinary individual.

An individual entrepreneur who has entered into a relationship under a GPA agreement as an individual entrepreneur will have to accrue and pay all payments required for an individual entrepreneur:

due to the applied taxation system;
insurance premiums for compulsory medical insurance and compulsory medical insurance;
taxes, the accrual of which is required by the presence of an object of taxation.

Find a comparative description of special modes, the use of which is preferred by individual entrepreneurs, here.

Re-qualification of a GPC agreement into an employment contract

Replacing an employment contract with a contract, although profitable, is risky. The law protects the interests of the employee, and the replacement of one contract with another leads to their infringement. If during the trial it turns out that the GPC agreement actually regulates the labor relations of the employer and employee, labor legislation will be applied to them (Article 11 of the Labor Code of the Russian Federation).

This also creates problems for conscientious employers. Many people work under GPC agreements, especially freelancers, and this is normal practice for work of an episodic nature. At the same time, even performers who have made presentations for the company several times can be recognized as employees and require requalification of the contract.

The name of an employment contract alone does not make it civil law: the content is more important. The Plenum of the RF Armed Forces issued a resolution in May 2021. It paid a lot of attention to the distinctive features of labor relations:

An agreement was concluded between the parties on the personal performance by the employee of a labor function predetermined in the contract under the control and direction of the employer.
The employee is subject to the employer’s internal regulations: instructions and instructions from management, labor regulations, and work schedules.
The employer provides proper working conditions.
The employee receives regular payment for performing a job function, and not the result of the work.
The employee's position is included in the staffing table and integrated into the employer's organizational structure.
The employer provides the employee with regular days off, rest on holidays and annual leave.
The employer pays the employee's work travel expenses.
The employer regularly makes payments to the employee, which are his only or main income.
The employer provides materials and tools for the contractor to perform the work.

The procedure for requalification of contracts is regulated by Art. 19.1 Labor Code of the Russian Federation. Civil law relations can be recognized as labor relations by:

the customer upon a written application from the contractor;
the customer, following an order from the State Labor Inspectorate (GIT) that was not appealed in court to eliminate violations of Art. 15 Labor Code of the Russian Federation;
court as a result of the direct appeal of the performer;
court as a result of a meeting on materials received from the State Tax Inspectorate and other authorized bodies and persons.

For example, Ship LLC entered into a GPC agreement with an individual on October 1, 2021. In December 2021, the court recognized the contract as an employment contract. Starting from October 1, 2021, the employment contract will come into force. From this date, the employee is entitled to all guarantees and compensation provided for by the Labor Code of the Russian Federation.

Only a court can reclassify an expired GPC as a labor license.

In the event of transformation of the GPC into a labor one, the organization will be held accountable for understating the base for insurance premiums. For the entire period of validity of the civil contract, additional contributions to the Social Insurance Fund and penalties on them will be calculated. The employee will be able to demand compensation and benefits from the company for all overtime, unused vacations and sick leave. Additionally, they may be required to recover compensation for moral damages for delays in payments.

If the employee’s salary during the period of work under the GPC was lower than the minimum wage for the constituent entity of the Russian Federation, he will have to pay extra.

Among other things, the employer can be held administratively liable and given a fine of 10 to 20 thousand rubles, and the organization itself - a fine of 50 to 100 thousand rubles. For repeated violations, officials face disqualification, and legal entities face an increased fine of 100 to 200 thousand rubles.

Additionally you will need:

draw up personnel documents: orders and personal cards;
make a record of work in the work book;
include the employee’s position in the staffing table if it is not there;
draw up an employee’s working time sheet, starting from the day the GPC agreement is concluded.

Let's figure out who can go to court with an application for recharacterization of the contract and what to do about it.

Contents of the employment contract

The list of conditions that must be included in the employment contract is given in the article of the Labor Code of the Russian Federation. In particular, this is information about the employee and the employer (including his TIN), as well as about the person who will sign the contract on behalf of the employer. The place of work, job function, payment conditions, working hours, etc. must also be indicated.

In some cases, the employment contract must include information not mentioned in the article of the Labor Code of the Russian Federation. For example, in an agreement with a foreigner temporarily staying in the Russian Federation, it is necessary to add a clause on the grounds for providing him with medical care (including entering data on the VHI policy). This is the requirement of Part 2 of Article 327.2 of the Labor Code of the Russian Federation. For more information about the employment of foreigners, see “Hiring foreign citizens in 2021: step-by-step instructions.”

Draw up an employment contract with a foreigner using a special constructor

Claims from tax authorities

Since 2021, the Federal Tax Service has been administering insurance premiums. She is interested in requalifying the GPC contract as a labor contract for the purpose of additional calculation of insurance premiums in case of temporary disability and in connection with maternity.

Most often, the tax office goes to court when an organization enters into a GPC agreement with an individual entrepreneur or self-employed person. Since these categories pay personal income tax and insurance premiums on their own, the organization does not assume the obligations of a tax agent and saves on taxes and contributions.

Recently, a fraudulent scheme has spread. In order to reduce payments, employers offer employees to register as individual entrepreneurs or self-employed and enter into a GPC agreement with them. In order to assess additional taxes, the Federal Tax Service applies to the court with a claim to recognize the GPC agreement as an employment contract.

Example: during an on-site inspection, the Federal Tax Service found out that the organization was working with individual entrepreneurs under GPC agreements in order to understate the tax base and receive benefits for personal income tax and VAT. At the same time, individual entrepreneurs were its employees and performed labor functions. In this regard, the tax authorities reclassified the contracts as employment contracts and assessed additional VAT, income tax, personal income tax, fines and penalties to the company. The executing entrepreneurs did not agree with this and filed a lawsuit. The courts of three instances rejected the entrepreneurs because the individual entrepreneurs worked in the organization’s office 40 hours a week, performed labor functions and did not pay rent. At the same time, individual entrepreneurs received monthly remunerations regardless of the amount of work performed.

So even the disagreement of the performers to requalify the contract does not protect against risks.

It is easier to defend your position if the GPC agreement is concluded with an individual, and not an individual entrepreneur or self-employed person, especially with the support of an employee. In court, he must declare that he himself wanted to enter into a GPC agreement with the organization, and not an employment agreement. Citizens have the right to freely dispose of their work and independently choose the procedure for registration - an employment contract or a civil law contract.

There are a number of other court decisions where employers were able to defend the GPA and prevent retraining. The tax authorities were not helped by their arguments. For example:

The GPC agreement provided for work and services that were assigned to full-time employees of the company and corresponded to their job functions.
Over the course of several months, an organization enters into an agreement with the same individual to perform one type of work or service.
The performer who worked under the GPC agreement was later included in the organization’s staff.

The presence in the GPC agreement of one or two circumstances that are not typical for this type of relationship does not prove their labor nature. Evidence can only be a combination of several signs of an employment relationship.

In disputes between legal entities and the tax office, the Federal Tax Service often wins. At the same time, even drawing up an agreement with an individual entrepreneur or self-employed person does not always become a decisive factor.

A striking example: the court recognized the contract concluded by the employer as not a civil contract, but a labor contract, since it immediately provided for many factors indicating the labor nature of the relationship. These include personal performance of clearly defined job duties for a long period of time, compliance with internal work regulations and safety precautions. During this entire period, the performer receives a fixed remuneration twice a month and bears financial responsibility.

Form and content of a civil contract with an individual - sample

How is the GPA completed? Since it contains quite a lot of conditions that require special reservations, it is always drawn up in writing. It should reflect:

names and details of the contracting parties;
subject of the task entrusted to the performer;
conditions for its implementation (volumes, quality, timing, ownership of raw materials and necessary equipment);
cost of work, terms of payment for them;
rights and obligations of the parties (including the condition on the accrual or non-accrual of contributions for injuries);
procedure for accepting completed work;
liability of the parties for violations of the terms of the agreement.

To learn about which points in the GAP you should pay special attention to, read the article “Contract agreement and insurance premiums: nuances of taxation.”

A sample civil legal agreement with an individual, executed by a legal entity, can be viewed on our website:

We do not provide a sample of a civil law agreement between individuals, since there are no special rules for its execution. Only the tax consequences will be special for him.

FSS claims

Contributions for injuries at work and occupational diseases are still administered by the Social Insurance Fund. Therefore, the fund is also interested in requalifying contracts, especially in organizations with high tariffs.

The FSS is extremely vigilant, so it often goes to court even in cases where the contract does not contain obvious signs of an employment relationship. Because of this, they are less and less able to reclassify the contract.

The contract must be drawn up carefully and competently. Any mistake increases the FSS’s chance of winning a legal dispute.

In one of the latest examples, the territorial branch of the FSS of the Russian Federation conducted an on-site inspection of the company and, as a result, assessed additional insurance premiums, penalties and a fine. The company entered into GPC agreements with the drivers, and the court reclassified them as labor contracts.

The fund believed that contracts with drivers are similar to fixed-term labor contracts; payments under them are a hidden form of salary and are subject to contributions.

The arguments were as follows:

drivers received working transport and a garage;
drivers received a regular salary in a fixed amount;
the contract did not specify a specific scope of work (the parties were not interested in the result, but in the process);
workers performed a labor function, and not one-time tasks.

The society tried to challenge the position of the FSS in court and received support in three instances. The courts proceeded from the fact that the contracts contained features characteristic of GPD: the presence of a specific type of service (driving a vehicle on the instructions of the customer), a fixed amount for the result of the service, the involvement of drivers as needed and not on an ongoing basis, no payments in the absence of orders .

However, in another similar case, the court satisfied the demands of the Social Insurance Fund for additional contributions.

The Supreme Court found that the organization entered into contracts with individuals to perform permanent, rather than one-time, work. It did not define a specific scope of work, and the relationship between the parties was of a long-term nature: for several years the contract was drawn up with the same person. In addition, the company provided the performers with a workplace, equipment and tools, and the work they performed regularly was paid twice a month. The staffing table contained a position with labor functions similar to the work performed by the contractor under the contract.

The court considered these circumstances sufficient to re-qualify the contract.

The FSS has a letter that it prepared for its territorial branches. The letter provides practical recommendations on the distinction between a civil process contract and an employment contract. These recommendations are still relevant today.

Orders and claims from regulatory authorities

Dissatisfied employees can contact the State Labor Inspectorate (SIT) with a complaint against the employer. The GIT can learn about violations of the organization not only from employees. Government agencies can report this: the prosecutor’s office, the police, the Federal Tax Service, and so on. If the State Tax Inspectorate finds out that the employer is hiding behind a civil process agreement instead of a labor agreement, it will issue him an order to eliminate the violation. The employer can either comply with it or try to appeal it in court.

There is no point in going to court if there really is a violation. If there is doubt about the nature of the relationship, the court interprets it as a labor relationship (Part 3 of Article 19.1 of the Labor Code of the Russian Federation).

Until January 1, 2014, the State Labor Inspectorate could not independently go to court with a demand to recognize the relationship as an employment relationship. Now the State Tax Inspectorate can conduct an inspection, prepare materials based on its results and take them to court with a claim to re-qualify the contract. In this case, the opinion of the employee himself is not taken into account. In this case, the court will study all the information and make a decision.

GIT does not often go to court to re-qualify contracts with individual entrepreneurs. The status of an entrepreneur implies greater security when working with customers and the possibility of not complying with internal regulations.