NOTIFICATION

The first discussion was held on the revised draft of the Labor Law and other submitted draft laws at the meeting of the Standing Committee on Social Policy of the Mongolian Parliament on January 6, 2021.
Please take that the Mongolian Wool and Cashmere Association, which is one of the hundreds of Mongolian employers, is grateful on the Parliament is revising the Labor Law at a time when dozens of new concepts and forms of labor relations are emerging in the current market economy.
However, some of the provisions and articles in the revised draft of the Labor Law express dissatisfaction and criticism from the representatives of the employers and manufacturers who are carrying the Mongolian economy on their backs.
In the face of a global pandemic, job-saving policies have become a vital issue for the Mongolian Parliament and government, as well as for thousands of employers. In particular, wool and cashmere producers, who are developing based on the domestic livestock sector, are trying to overcome difficult times by recognizing their responsibility to keep their jobs and pay their employees in accordance with the Labor Law.
In any employment relationship, the rights and responsibilities of the two subjects, the employer and the employee, are highly interdependent. If the balance of both can be adjusted and legalized, the satisfaction of both parties to the labor relationship will be established, and to that extent labor productivity will be high and will further contribute to the development of the country. On the other hand, emphasizing or stifling one of them can be a major obstacle to the development of the sector.
Having say that, the Mongolian Wool and Cashmere Association believes that the revised draft of the Labor Law is a draft law that imposes a system of fines on employers and excessive rights, benefits or welfare policies for employees. For example, in the draft law:
• In Article 4.1.19, salary means the employee’s basic salary, bonuses, allowances, vacation pay and inventives.
• In the Article 10.1, it is prohibited for employers to demand or pledge personal documents such as educational documents, professional licenses, movable and immovable property certificates, from a person or employee who is about to be hired.
• In accordance with Article 58.1 of this law, the paragraphs 74.2, 74.3 and 91.1, the employee who has reduced his/her working hours shall be paid on the basis of his/her hourly wages, and the employer shall provide additional compensation equal to the salary for the reduced hours.
• Article 69.3 stipulates that the period of continuous rest between two consecutive working days shall not be less than 12 hours.
• In Article 72.1, the time and place of waiting for the employer to agree on the location and time with the employee and the waiting time shall be considered as working hours.
• In Article 73.1, an employee who works at night shall be given a day off equal to the number of hours worked at night the next working day.
• In Article 74.1, an employer may, at the request of an employee, reduce working hours as agreed with the employee.
• In Article 76.1, an employee shall be deemed to have worked overtime if he/she has been overworked at the initiative of the employer for the duration of the working day specified in Article 69.2 of this law.
• In Article 82.1, the employer may grant personal leave/absence at the request of the employee.
• In Article 82.2, the procedure for granting personal leave, the period of leave/absence, and the payment of compensation for the period of personal leave shall be regulated by labor and collective agreements and other internal norms.
Many of these provisions need to be reviewed, amended, updated or deleted. Changes such as increased employee rights, compensation, overtime pay, personal leave, paid leave, and increased vacation time are detrimental to employers and can lead to long-term disputes between employers and employees. It is important to note that there is a risk that welfare will be a policy of rest, not employment.
In addition, there are many provisions in the draft law that have semantic and grammatical errors and need to be amended. Most alarmingly, the cost to the employer has risen sharply, and penalties imposed on employers by 24 articles have made it impossible for them to operate normally.
On behalf of thousands of employers, I would like to express my condolences to Ts. Munkh-Orgil, Member of the Parliament and the Head of the Work Team that drafted this law that creates welfare policies and discriminates against employers, who promote Mongolia’s developement and create jobs.
By the way, I would like to emphasize that thousands of companies engaged in services and production in Mongolia, work under many other laws besides the Labor law and regulations in strict service conditions and in the system of harassment and fines.
In such a situation, re-enforcing a law that hardens employers, fines them for every action, and encourages welfare poicies is not the key to Mongolia’s development.
Therefore, we hope that the Working Group of the revised draft of the Labor Law and the Parliament of Mongolia will pay special attention to this issue and review the right solution.
The Mongolian Wool and Cashmere Association

January 14, 2021