Fine for a foreign worker for individual entrepreneurs in 2020

Is it necessary to officially register an employee with an individual entrepreneur?

Official registration of an employee with an individual entrepreneur is a prerequisite. As soon as an individual entrepreneur enters into an employment contract with a person, he actually becomes an employer. This agreement must be concluded no later than three days from the date of hiring. Within 10 days, the individual entrepreneur registers the workforce with the Social Insurance Fund, and within 30 days with the Pension Fund. An unemployed individual entrepreneur faces a fine.

What fine is imposed if illegal employees are identified?

Also, for everyone who has worked for more than five days, it is necessary to issue work books. The maintenance of books is regulated on the basis of the Labor Code and other regulations.

Important! Labor legislation is mandatory for employers to comply with.

When an employee comes to an entrepreneur, the individual entrepreneur must ask him for registration:

• passport;
• book about work activity;
• military ID. Provided to men between 18 and 27 years of age who are eligible for military service;
• TIN. If the employee is not an individual entrepreneur, then it is not necessary to have a TIN;
• medical book. Its presence is necessary for workers in the catering industry, medicine, and salespeople in grocery stores;
• a document from the Ministry of Internal Affairs stating that there is no criminal record;
• educational documents.

Referring to these papers, the individual entrepreneur draws up an employment contract. It must be in two copies. There is a standard form of the agreement, but it is possible to make changes and additions to it.

The agreement must necessarily indicate:

• FULL NAME;
• information from the passport;
• the place where the contract is drawn up, as well as the date of conclusion.

Also, the drawn up contract specifies information such as position, working hours, benefits, etc.

After the contract is concluded, it is necessary to issue an order stating that the person has been hired, as well as make an entry in the work book.

The employee is obliged to perform his functions on the basis of the job description. The individual entrepreneur must create all the conditions for performing these functions. The responsibilities of the IP also include:

• payroll;
• transfer of contributions and taxes to the relevant authorities;
• granting leave;
• sick pay.

Important! The relationship between employer and employee is regulated by the Labor Code.

Based on Article 64 of the Labor Code, an individual entrepreneur cannot unreasonably refuse a person a job. In case of any violation of their rights, a person can contact the labor inspectorate.

Individual entrepreneur fined for unregistered seller

Individual entrepreneurs have an even greater chance of being fined in the case of sellers working without registration. Typically, trading is carried out in public places, where unscheduled and sudden inspections are especially often practiced by regulatory authorities.

Violations of labor laws can be detected through a banal test purchase for the use of online cash registers, the issuance of cash receipts and the sale of alcoholic beverages to minors. When drawing up reports of an offense, the seller’s data and documents are provided, which means it’s a matter of technique to find out whether insurance premiums have been paid for the offending employee. The fines for an unregistered seller are identical to the fines for an unregistered employee - from 5 to 10 thousand rubles.

Example A seller violated trade rules and sold alcohol to a minor. In this case, the amount of the fine for the seller himself is from 30 to 50 thousand rubles, for the entrepreneur as an official - from 100 to 200 thousand rubles. Next, payments to the Pension Fund and the Social Insurance Fund for the guilty person can be checked by last name, and (in the absence of payments) for the unemployed employee there will be fines already listed above.

Fine for failure to register

When an individual entrepreneur does not employ a citizen, this entails that the employee does not receive the social guarantees due to him: payment of sick leave, vacation pay and other income that are provided for when drawing up an employment agreement.

Cashing out money through an individual entrepreneur - what are the consequences?

Also, if an employee resigns, unscrupulous individual entrepreneurs do not make the final payment and do not pay compensation for unused vacation. It is very problematic to recover these unpaid compensations with the help of the court, since there is no evidence that there was an employment relationship between the person and the individual entrepreneur.

An individual entrepreneur fine for an unregistered employee is imposed for the following reasons:

• due to the absence of an employment agreement, personal income tax is not paid;
• There are no transfers to the Pension Fund. This becomes the reason that the person’s future pension will not change in any way;
• since contributions to the Social Insurance Fund are not made, the employee loses state guarantees: sick leave, maternity leave, unemployment benefits;
• transfers to health insurance are not made, which leads to the fact that the employee may be denied medical services.

These factors lead to an increase in fines for individual entrepreneurs for unregistered workers in 2020.

The employer bears administrative responsibility for failure to register the workforce. It applies when the violation is minor. For example, an employee was not registered within 1-2 weeks. In this situation, the fine for failure to register an employee as an individual entrepreneur can be up to 5,000 rubles. For more serious violations, the entrepreneur may be prohibited from operating for up to 90 days. This may result in large losses and the entrepreneur may lose his business.

Important! In addition to fines, wage taxes will be assessed for the entire period of using labor without employment.

If the registration is not carried out properly, then this will also result in a fine. Violations may involve infringement of rights. The employer is obliged to provide labor protection:

1. Guarantee individual protection. This is recorded in the journal.
2. As a result of certification, PPE is issued.
3. Before starting to perform their functions, employees must study the safety rules against signature.

Penalties for failure to register employees

Administrative responsibility (Article 5.27 of the Code of Administrative Offenses of the Russian Federation)

The administrative fine of an individual entrepreneur for an unregistered employee in 2020 under Part 1 of Article 5.27 of the Code of Administrative Offenses varies from 1,000 to 5,000 rubles (a warning is possible instead of a fine). If you repeat, the fine will increase to 10,000–20,000.

If an individual entrepreneur evades formalization or improperly formalizes an employment contract or has entered into a civil contract that actually regulates labor relations between the employee and the employer, he may face a fine under Part 4 of this article in the amount of 5,000–10,000 rubles, in case of repeated violation the fine will increase to 30,000–40,000 rubles.

How can an unemployed employee be detected?

There are special bodies to identify and suppress violations of the Labor Code. There are a large number of them. The main ones are: tax and labor inspection.

Fine for working without an individual entrepreneur - what will happen to the activity without its registration?

Law No. 294 regulates inspection procedures. The tax authority relies on Chapter 14 of the Tax Code.

Offenses are detected through desk and field inspections. Tax specialists can request documentation for the current year, as well as for the three previous ones.

Important! The legislation allows for the examination of witnesses, the inspection of premises and the seizure of documents. The tax office must have permission to audit.

After the inspection is completed, a document is created that indicates violations and gives advice on how to eliminate them. Two weeks are given for elimination.

Based on the protocol drawn up, fines are imposed, and an appeal to the court can be filed to impose criminal liability.

Control authorities can arrive at any time. This event is taking place due to complaints from competitors and employees of the individual entrepreneur. There are situations when departure occurs with several regulatory authorities.

How are illegal immigrants identified?

The individual entrepreneur has not registered the employee - what will be the fine?

The responsibility of an entrepreneur increases significantly when using the labor of hired workers. After all, if an employer officially accepts an employee, this means adding a serious amount of additional reporting to the Federal Tax Service, the Pension Fund of the Russian Federation, the Social Insurance Fund, the military registration and enlistment office, statistics, the employment service and other regulatory authorities. And in addition to reporting, you need to pay wages twice a month, provide vacations, certify workplaces, observe safety precautions... - this list can be continued endlessly.

Therefore, entrepreneurs often work without paperwork, but without thinking about the consequences. And the consequences for individual entrepreneurs can be in the form of administrative and criminal liability. The prosecutor's office, tax and labor inspectorates often receive information about such violations from the disgruntled employees themselves. If you do not formally register an employee, the following sanctions are possible:

• Administrative responsibility. The fine for an individual entrepreneur for an undocumented employee depends on the offense and is specified in detail in Art. 5.27 Code of Administrative Offenses of the Russian Federation:

After formalizing the employment relationship, for the entire previous period of illegal hiring, you will have to pay underpaid taxes and contributions, late fees at the rate of 1/300 of the refinancing rate for each day and fines in the amount of 20-40% of the underpayment.

• Criminal liability. The Criminal Code divides responsibility for arrears of taxes and contributions and especially for insurance premiums for compulsory social insurance from the National Social Security (accident).

Liability of an illegal worker

The employee himself will also be responsible according to the laws of the Russian Federation. So, according to Article 18.10 of the Code of Administrative Offenses of the Russian Federation, paragraph 1, he will have to pay a fine in the amount of 2,000 to 5,000 rubles. Additionally, he may be expelled from the territory of the Russian Federation.

If this administrative violation was recorded in a city of federal significance, the fine will be higher - from 5,000 to 7,000 rubles, and the illegal immigrant will be additionally expelled from the Russian Federation.

If a foreign person incorrectly issued a work permit, works in the wrong region or in the wrong specialty, then the fine will be from 4,000 to 5,000 rubles.

If an illegal worker has already received a court order, but ignored it, Article 20.25 of the Code of Administrative Offenses of the Russian Federation comes into force - he will pay a fine of 3,000 to 5,000 rubles and will be forcibly expelled from the territory of the Russian Federation in an administrative manner.

How to pay

If a fine is imposed, payment is made at any bank.
It is enough just to present a receipt on the spot from the Main Directorate for Migration of the Ministry of Internal Affairs, which can be issued at the department of the authority or on the website. Details are presented on the service portal. For non-payment, the tenant may:

• oblige to pay double the amount of the fine;
• put under administrative arrest.

It is possible to pay through the State Services website. To do this, the violator must have access to his personal account. To proceed to payment, you must do the following:

1. Enter “payment of fine by number” in the search bar;
2. Select the appropriate option from the list that opens;
3. Next, the user will be redirected to the payment page. A receipt for payment will be sent by mail.

Read also: Moving to Crimea for permanent residence

Payment is accepted both at the tax office and at the MFC. After transferring the money, the payer will be given a receipt for payment.

Responsibility of an individual entrepreneur for a foreign employee

An individual entrepreneur bears a huge responsibility for a foreign worker.
In addition to basic personnel management, it is necessary to carefully monitor the migration document flow, for example, check patent payment receipts every month and use them to renew registration. Moreover, if a migrant is late in payment by at least one day, the patent will automatically be revoked, which means the migrant will become an illegal immigrant and will no longer be able to work for the individual entrepreneur.

If the individual entrepreneur did not register the foreign citizen on time and the employee was stopped by a police squad to check documents, then you will have to go with all the documents to the police station and be responsible for your employee even at night.

As for “first-time warnings” from the police and inspection services, this does not apply to migration law. For any misconduct, the individual entrepreneur will have to pay a fine for the foreign worker in order to avoid more global problems.

How can an individual entrepreneur protect himself from fines for migrants and get rid of all the employer’s risks?

Having read about all the risks and fines that can overtake an individual entrepreneur with the slightest accidental mistake when registering and managing a migrant, the question immediately arises: “How to legally register a migrant, but at the same time minimize the risks?”
The answer is very simple: “No way!” By registering migrants with him, the individual entrepreneur also assumes all the employer’s responsibility to government agencies. This means that with any defect or the slightest mistake, a foreign worker becomes an illegal immigrant, and the individual entrepreneur will face a huge fine.

Other migrants

The inclusion of foreign workers from countries that are not members of the EAEU into the workforce requires compliance with additional requirements. The basic regulations for entrepreneurs are Law No. 115-FZ of July 25, 2002 and Government Decree No. 1365 of November 14, 2018. The procedure will be influenced by the migrant’s stay in Russia.