Differences between a GPC agreement and a labor agreement: pros and cons for the parties

An employment contract is 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).

When to use a civil contract will not work

There are cases when legislation answers negatively to the question of whether the conclusion of civil contracts is allowed for certain types of work. According to the DGPKh, for example, it is impossible to entrust the maintenance of military records to third parties (Resolution of the Government of the Russian Federation No. 719 of November 27, 2006, Methodological recommendations for maintaining military records in organizations, approved by the General Staff of the Armed Forces of the Russian Federation on July 11, 2017). It will be possible to transfer some, but only with restrictions. So, when transferring personnel records:

• maintaining and storing work records remains the responsibility of one of the full-time employees;
• The contractor is granted permission to work with personal data under the GPD (FZ-152 dated July 27, 2006).

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.

GPD with a former state or municipal employee

Many people know that the law obliges a former employee to inform the new employer about his last place of service within 2 years after dismissal from state or municipal service. And the new employer is obliged to inform the former employer about the conclusion of the employment contract.

This obligation applies to those employees whose positions were included in special lists that are determined by Federal Law No. 273 - the anti-corruption law. There are more than one lists: the main one is this one, but regions may have their own.

It turns out that it is not so easy to recognize a former employee... but it is still possible. They are determined by their work book: there will be a link not to the Labor Code, but to the Federal Law on the State Civil Service - the Federal Law “On the State Civil Service of the Russian Federation”. Former municipal employees do not have such a record, so you need to look at the title of the position: if you see something like “chief of the information technology department of the administration of such and such a city district,” then this is undoubtedly him. This means that it is there, to the administration, that the notification must be sent.

But even if the contract is not an employment contract, but a GPC, then the customer also has such an obligation. However, there are some nuances: you need to notify if the cost of work or services under the contract (or all contracts, if there are several of them) exceeds 100,000 rubles per month. And even if such an agreement or agreements are concluded for a period of less than a month, and the total amount is more than 100,000 rubles, then the obligation to notify remains.

The notification is submitted within 10 calendar days after the conclusion of the GPC agreement: for example, if it was concluded on January 13, 2022, it was notified up to and including the 23rd.

There are no carrots here, there is only a stick: those who forgot to report on time will be punished by the Administrative Code - there will be a fine of up to 500,000 rubles. The lower limit is 100,000 ₽. Agree, a considerable amount.

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.

What consequences will the reclassification of a civil law contract into an employment contract entail?

If a civil law contract is recognized as an employment contract, the employer may be required to:

• recalculate and pay taxes and insurance premiums;
• recalculate and pay additional wages and other payments to which the employee is entitled in accordance with labor legislation;
• compensate the employee for moral damage (if such a claim is filed);
• add an employee to the staff.

In addition, the employer may be held administratively liable under Art. 5.27 of the Code of Administrative Offenses of the Russian Federation in the form of a fine in the amount of 5,000 to 10,000 rubles. for individual entrepreneurs, from 50,000 to 100,000 rubles. for organization and from 10,000 to 20,000 rubles. for an official.

In order to avoid the above consequences, it is necessary to carefully draw up the contract, avoiding the inclusion of provisions specific to labor relations.

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.

Civil agreement with a full-time employee

The law does not prohibit concluding civil contracts with full-time employees. Such work is carried out within the organization:

• in addition to official duties;
• or during the period of paid annual leave.

When an employee of an organization becomes a party to such an agreement, when concluding a civil contract, the employer is obliged to comply with the following basic requirements:

• relations are regulated by the Civil Code;
• the tasks performed differ from the main duties of the TD;
• are performed in free time from the main job;
• The document contains no signs of an employment contract.

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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.

In what cases can a civil law contract be reclassified as an employment contract?

A civil law contract can be forcibly reclassified as an employment contract if:

• The text of the contract includes conditions characteristic of labor relations or indicating them (provisions on regular wages, vacation, social guarantees, sick pay, personal performance of work, work schedule and subordination to labor regulations, information about position, specialty, profession, etc. .);
• the implementation of work under a civil law contract is permanent and not one-time in nature;
• there is no document confirming the fact of performance of work under a civil contract (if its execution is mandatory as required by law);
• the contract was renegotiated several times after its expiration;
• remuneration is paid on the same basis as full-time employees, according to the tariff schedule, at least twice a month.

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.

What taxes does the employer pay under the GPC agreement?

If the payment is made to an individual, then personal income tax in the amount of 13% must be withheld and paid from the fee. If the customer is an organization, then this tax is calculated and transferred to the budget by the customer, since in this case he is the tax agent.

For example, the remuneration under the GPC agreement is 10,000 rubles. In fact, the customer will transfer 13% less to the employee, that is, 8,700 rubles. The amount of personal income tax in the amount of 1300 rubles. the customer will transfer it to the budget.

An exception is a GPC agreement concluded with an individual entrepreneur. In this case, taxes on payments under a civil law agreement are paid by the individual entrepreneur.

Table 1. Taxes that must be paid on payments under a civil contract.

Important nuances regarding the taxation of payments under GPC agreements:

• An individual, receiving payments under GPC agreements, has the right to use standard tax deductions . For example, deductions for the purchase of real estate, payment for education or medical services, including dental services, deductions for the presence of dependent minor children. In this way, you can reduce the amount of income tax that is transferred to the state, or return previously paid taxes from the budget.
• To take advantage of tax deductions, an individual must provide receipts for all expenses.
• The deduction and transfer of insurance premiums under the GPC agreement by customers is carried out not in favor of various funds, but strictly to the tax office.
• Any fees are paid only if the agreement between the contractor and the customer involves the provision of copyright services or the performance of contract work. When executing agreements regarding a lease or a cash loan, social payments are not transferred to the local education budget.
• When concluding a transaction, the purpose of which is not only to perform work, but also to transfer rights to property, the income lines of the second party must be divided into taxable remuneration and non-taxable financial receipts. Contributions will be deducted only from the first part.

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.

Employment contract

Before signing an employment contract, the employer and employee must know the basic rules that both parties are required to comply with.
According to the employment contract: 1. The employee is obliged to adhere to the generally accepted internal regulations and rules of the organization, to work according to a certain schedule, which was established when hired in personnel documents.

2. The employee is obliged to personally perform the work and duties provided for by his regular position (engineer, programmer, etc.)

3. According to the legislation of the Russian Federation, an employment contract can be concluded both for an indefinite period and for a period of no more than 5 years (such an employment contract is considered fixed-term).

4. According to the employment contract, the employee is required to pay wages at least 2 times a month, that is, an advance or salary for the first half of the month and a monthly salary.

5. The employer must withhold personal income tax and pay insurance contributions to the Pension Fund, Compulsory Medical Insurance Fund and Social Insurance Fund.

6. According to the employment contract, the employee occupies a position in the hierarchical scheme, that is, he is subordinate to the employer.

Benefits for the employee:

• according to the employment contract, the employee is required to provide a salary that must be at least 11,163 rubles, which is the minimum wage (minimum wage), effective from May 1, 2022;
• the employee increases his seniority, which will affect his pension fund in the future;
• the employee is provided with a social package, which gives him a dismissal benefit, days off, business trips, paid leave, financial assistance, bonuses, etc.;
• hiring an employee and including him in the organizational chart of the organization.

Disadvantages for the employee: the employee has clear regulations that he must adhere to.
Advantages for the employer: the employee is obliged to comply with local regulations of the enterprise, company rules and job descriptions. For failure to comply with these rules, the employer has the right to issue a reprimand, including in the form of dismissal. That is, the employer has more power and leverage over the employee.

Disadvantages for the employer:

• it is necessary to pay the employee a salary at least twice a month;
• it is necessary to create conditions for the work of a full-time employee: provide a workplace that must be equipped with all the necessary elements to perform their tasks;
• It is necessary to maintain all personnel documentation for all employees of your organization.

An employment contract can be terminated at the initiative of the employee or the employer, by agreement of the two parties, upon expiration of the contract, due to the employee’s health and transfer to another job, etc.

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.

When is a GPC agreement recognized as an employment agreement?

It’s worth starting with the fact that repurposing a GPC agreement is, first of all, an unpleasant process, because the employee working under such an agreement is not part of the company’s staff, due to which the amount of personnel work is significantly reduced and there is no need to make payments for sick leave and vacations. The employee may not even be provided with a workplace.

And if the contractor is transferred to ordinary employees, then the customer will have to pay contributions to the Social Insurance Fund and transfer penalties, and in addition, he may have to pay saved social benefits.

Criteria by which a relationship is recognized as an employment relationship:

1. The agreement specifies specific functional responsibilities, not actions with results.
2. The employee receives a fixed amount of payment every month, since in such cooperation it must vary and in no case be the same.
3. A hired worker constantly performs the same work.
4. The employee was fully provided with an equipped workplace.
5. The document does not specify the mandatory conditions that any GPC agreement must contain (this includes terms, amounts of payments, etc.).
6. The employee receives vacation and sick pay.
7. The agreement specifies the rules and regulations established for a particular enterprise.
8. The hired employee must report to the employees of the enterprise who work under an employment contract, that is, they are on the staff.
9. The employee goes on business trips and receives travel allowances.

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 2022. It paid a lot of attention to the distinctive features of labor relations:

1. 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.
2. The employee is subject to the employer’s internal regulations: instructions and instructions from management, labor regulations, and work schedules.
3. The employer provides proper working conditions.
4. The employee receives regular payment for performing a job function, and not the result of the work.
5. The employee's position is included in the staffing table and integrated into the employer's organizational structure.
6. The employer provides the employee with regular days off, rest on holidays and annual leave.
7. The employer pays the employee's work travel expenses.
8. The employer regularly makes payments to the employee, which are his only or main income.
9. 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, 2016. In December 2022, the court recognized the contract as an employment contract. Starting from October 1, 2016, 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:

1. draw up personnel documents: orders and personal cards;
2. make a record of work in the work book;
3. include the employee’s position in the staffing table if it is not there;
4. 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.

With whom can you conclude a GPC agreement?

As already noted, civil law agreements can be signed by individuals, individual entrepreneurs, and legal entities. Customers of services have the most questions when working with individuals. In particular, companies are interested in whether it is possible to conclude GPC agreements with their full-time employees who already have an employment contract, with employees officially employed in other organizations, with teenagers or foreigners.

Is it possible to conclude a GPC agreement with your own full-time employee?

It is possible, although this is not the most common practice. This possibility is confirmed by letter from the Moscow Department of Taxes and Duties No. 14-14/5848 dated February 4, 2000.

A GPC agreement with a full-time employee may be required if the employee must perform some overtime work that is not specified in the job description, and, moreover, in a short time. However, in this case, the Labor Code provides for other, simpler options: for example, part-time work or hiring for two positions with additional pay.

These options are good because the relationship between employer and employee continues to be regulated by the Labor Code and does not move into the sphere of civil law, i.e. falling under the Civil Code. Therefore, GPC agreements are not very common and are usually concluded only in cases where it is difficult to arrange additional payment or part-time work. For example, civil law agreements are often concluded with full-time employees on vacation.

Is it possible to conclude a GPC agreement with a minor?

GPC agreements can be concluded with teenagers over 14 years of age. From this age, individuals receive partial legal capacity, which allows them to enter into civil legal relations. However, before reaching 18 years of age and gaining full legal capacity, any contracts must be signed in the presence of parents or guardians and with their written consent.

When hiring teenagers, employers most often give preference to civil rather than employment contracts. After all, concluding such an agreement removes a number of inconveniences. For example, a teenager working under the GPC is not required to undergo a medical examination required before signing an employment contract.

Is it possible to conclude a GPC agreement with a foreign citizen?

In the case of hiring foreign citizens, concluding GPC agreements is considered more rational than signing employment contracts. The form of such an agreement will not differ from that which the company signs with Russian citizens.

The main thing that an employer must remember is a thorough check of the residence permit, work permit and other documents allowing a foreigner to live and work in Russia. After all, for hiring a citizen who does not have the right to work or even stay on the territory of the state, the entrepreneur will face serious sanctions.

Claims from tax authorities

Since 2022, 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.

Types of GPC agreements

So, the parties to the GPC agreement can be:

• ordinary employees - individuals;
• IP;
• contractors of various legal structures (LLC, PJSC, etc.);
• government bodies (budgetary, government, etc.).

Accordingly, the most common GPC agreements can be divided into several categories.

How to draw up a civil contract for the provision of services by an individual ?

Contract for paid services

The most popular type of GPC agreements. They are concluded by employers-legal entities and hired employees-individuals. The terms of the contract clearly state what services the employee undertakes to provide, for how long and under what conditions. Paid-for-fee contracts are common in areas where seasonal work or project-based work is required.

Question: Is it possible to recognize expenses for income tax purposes under a civil contract (including outsourcing) if the staff has divisions (employees) with duplicating functions (clause 1 of Article 252 of the Tax Code of the Russian Federation)? View answer

Contract (household, construction, etc.)

IMPORTANT! A sample contract agreement with an individual from ConsultantPlus is available here

It is concluded between two legal entities or a legal entity and an individual entrepreneur. The subject of such an agreement is the performance of clearly defined work.

The customer is one company, the contractor or performer, respectively, is another: it can be an LLC, individual entrepreneur, etc. Such agreements are often concluded, for example, in the housing and communal services sector: management companies that do not have maintenance personnel on staff hire contractors to perform cleaning, minor repairs, etc.

Agency agreement

In this case, the company hires a citizen as a principal, or attorney. Based on such an agreement, an individual can act on behalf of a legal entity in various authorities, defending the interests of the company. Upon expiration of the GPC agreement or in equal shares during its validity, the employer pays the attorney the amount indicated in the “Terms of settlement” paragraph.

Agency contract

Usually concluded between two legal entities. One of the parties, called the “principal,” instructs the other party, the “agent,” to conduct a certain type of activity on its behalf. Most often, an agent is hired to sell goods and services or promote them on the market.

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.

GPA is not a TD: “performer” does not equal “employee”

As they say in good and bad detective stories, anything you say can be used against you. Hence the conclusion: the GPC agreement should not contain anything that could indicate an employment relationship. It is important.

Many, unfortunately, confuse an employment contract and GPA with an individual. The logic in this case is something like this: I entrust him with the Work - that means he is a Worker, and whatever he earns, I will pay him. And if so, then we will write all these words - employee, employer, salary - in the contract... and in vain.

The subject of the contract should not talk about “services of a HR manager” - it is correct to write that we need “consulting services in the field of HR management.” In other words, we remove the title of the position, leaving the essence.

It is necessary to clearly understand that the executor under the GPC agreement is not an employee: he does not obey the internal labor regulations, receives not a salary, but a remuneration, and he can wrap even sausage or fish in his job description, because it does not apply to him either. Accordingly, not only the subject matter, but other parts of the contract should not contain signs of an employment relationship. By the way, several years ago we had a detailed article about how an employment contract differs from a civil law one.

If you nevertheless decide to include some labor conditions in the GPA, then you must remember: in the event of a dispute, such an agreement can be recognized as an employment agreement if the court determines that labor relations are actually regulated. The word “court” can be replaced with “GIT” - state labor inspection - this department also has such powers. And the performer will thus turn into an employee, with whom it is now very difficult to part with. Usually, no one wants it of their own free will, but by agreement of the parties, it’s money, money...

In addition, sanctions are very likely (and if it comes to official proceedings, then inevitable): for organizations a fine of up to 100,000 rubles, for individual entrepreneurs - up to 10,000 rubles. You will also need to accrue money for vacation and pay to the social insurance fund.

Therefore, we recommend concluding GPC contracts only for temporary, irregular work, and hiring those who are needed permanently and concluding an employment contract with them.

How to understand the nature of the relationship between you and the customer? Just imagine that instead of concluding a contract for the provision of services, you hired him. If nothing changes, there is an employment relationship.

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.