On April 5, 2015 the Law of Ukraine1 (the “Law”) entered into force, extending the list of “corporate officers” and implementing a wide-ranging array of other deregulation changes. The rules as amended allow companies to apply the special dismissal procedure of corporate officers not only to those specifically defined as the “corporate officers” by law, but also to those defined by the company’s charter.
More space for applying the special procedure for corporate officers’ dismissal
In May 2014, the Labor Code of Ukraine was supplemented with the provision allowing employers to dismiss corporate officers due to revocation of their powers. No additional grounds for dismissal are required. The key conditions of such procedure are:
- revocation of corporate officer’s powers prior to the dismissal (by the respective decision of the general meeting of shareholders or supervisory board of the company); and
- severance payment to the dismissed officer in the amount of at least six average monthly wages.
Until recently, due to the narrow legislative definition of “corporate officers”, this procedure could only be used for dismissing the head and members of executive body, members of audit commission, auditor, and the head and members of supervisory board.
The Law allows companies to extend the list of corporate officers by amending their charters respectively. It states that the head and members of the company’s other body created on the basis of the charter shall also be referred to as “corporate officers” if authorized to manage the company.