Sad Sad May 1 

On May 1, Prime Minister Nikol Pashinyan congratulated workers and called on them to demand employers to officially register them as a step enabling the government protect their working rights. Pashinyan emphasized, that despite the sudden crisis, the government will “consistently continue to pursue economic development boosting work and working people”, while he also said that the stimulus program adopted by the government to tackle the coronavirus pandemic was primarily targeted at companies that did not violate tax and labor legislation. He said that this was in a way a “gratitude” to working people, but also an opportunity to “easily identify people in need of support, as it was easier to identify registered people.” He concluded that having an officially registered job is an important safeguard to working rights. 

The plight of the Prime Minister is definitely welcome, as the shadow labor market and tradition of unregistered labor have been a disaster both for the state and the workers before the coronavirus crisis and will be after it. But the festive wishes and toothless calls have no potential to change the situation as long as the state’s toolkit in coordinating the labor sector is limited to plights and gratitude.

The extremely vague privileges of registered workers and their lack of protections make the borderline between being registered and unregistered even more murky. This is especially true about laborers and service sector workers. The pandemic has marked an exception and not a rule that for the first time the fact of being a registered worker has been valued in the form of state benefits (to replace lost income). Before, this would only have been perceived as an opportunity or a chance that does not give anything more and does not protect from anything.

To get registered, means to count taxes off the wages. A worker earning 100.000 AMD (close to 200 USD) per month may listen to the Prime Minister’s call and require job registration (and reduce the wages by 23 percent by transferring it to the state budget).

The government, however, does not have any leverages to protect. In the unequal duel between the employer and employee, the government has taken the role of an invited mediator who offers some norms, but does not enforce them.

Aside from accentuating state kindliness, the pandemic made it bare how miserable the labor market is and so is the capacity of the state in face of large employers, CEOs of enterprises and local feudalists.

Businessmen with huge capacities overtly circumvent their legal obligations. Look at MP and oligarch Gagik Tsarukyan publicly stating that he had no intention to make idle pays (including to registered workers). And of course, he did not, in violation of the Labor Code. Even worse, at “Arinj Mall” owned by him, workers were forced to pay space rental fees despite the fact that the mall was closed. Deputy CEO of the mall and member of Yerevan municipal council, Armen Nersisyan called this “a warm family environment” where he requested “not to poke a stick between the finger and the ring.” At “Sas Group” a retail chain, workers were allegedly forced to sign requests of unpaid vacation. Former MP and oligarch Samvel Alexanyan’s workers at food business (including retail supermarket chains) were forced to work double time, 16 hours, often 18 hours often in return for miserable 2000 AMD overtime pay. Large or small, businesses would send workers on unpaid idleness. These illegalities were many, however none of them received the appropriate characterization. To mitigate the situation, the government decided to pay what the oligarchs wouldn’t pay. And that came, again, from the pockets of workers eventually, from taxpayers’ money.

Zaruhi Batoyan, Minister of Labor and Social Issues, made a frank response to this arrangement of life. On March 21, she reflected on the manipulations employed by businesses on her Facebook page by writing: “Although we have drafted amendments to the Labor Code, the law even now regulates employer-employee relations, the Ministry of Labor and Social Issues has no power to oversee them.” She invited persons suffering from arbitrary actions of employers to turn to Sakunts office [Helsinki Citizens’ Assembly Vanadzor human rights organization headed by Artur Sakunts]. In the comments, she clarified that the Ministry indeed cannot help, citizens are advised to turn to court. She deleted this post on the next day. 

Apparently, no powers are assigned to the Health and Labor Inspectorate under the Prime Minsiter too. This body is entitled to only oversee occupational health and safety norms at workplaces. Other norms of occupational rights, including wages and their payment, is still [1] out of the inspectorate’s scope of work.

Minister Batoyan’s explanations and the statute of the Inspectorate reflect the state of exception formed in Armenia way before the pandemic, at least since 2013 when laws were adopted to deprive labor-regulating state bodies from real powers to regulate.

To outline the paucity of the status of these bodies, it is important to remind that for 13 years after the breakdown of the Soviet Union, Armenia did not even have a Labor code. In a country building market economy at astronomical speed, the Soviet Labor Code was in force until 2004 where market economy was outright banned. Armenia did not have a Labor Ministry either and the Social Security Ministry was only renamed to meet the formal demands of the International Labor Organization as a requirement for joining it. In oligarchic Armenia, a State Labor Inspectorate operated until 2013, empowered by inspections at workplaces and requiring compliance with laws, however it was dismantled in 2013 and merged to the Health Inspectorate. The invisible hand of the market erased the powers to inspect labor regulations from the new inspectorate’s statute.

Thus, if an employer is violating your working rights, is refusing to pay the earned wages, is not paying overtime and is depriving of earned holidays, then the Ministry of Labor and Social Issues and the Health and Labor Inspectorate cannot help indeed. If during the pandemic, there is a slight hope that the state will provide minimal benefits to only those that happen to be registered workers, then after the pandemic this hope will disappear. What will remain is the state encouragement to demand… or turn to Sakunts office to assist with litigation (normally after being dismissed from work already).

Armenia’s employers have a dislike for employees turning to courts. The Armenian state does not have powers to respond to this dislike with legal safeguards that would protect “demanding” workers from the arbitrariness of employers. 

The “on call” holiday wishes and calls to self-protect, demand and, if needed, fight in courts expressed by responsible agencies, are void of content, as is made apparent here.

While Nikol Pashinyan’s wholehearted concerns do not yet rise suspicions, as the unprecedented social programs and anti-crisis support were convincing, however real labor changes have not been carried out in the post-revolutionary two years. Perhaps, because the government is unable to clash with the local oligarchy and criteria to attract foreign investors for whom Armenia is attractive by extractive resources and unprotected laborforce. But maybe because there is no ample political will too.

Z. H.

[1] In December 2019, one and a half years after the Revolution, amendments were made to the Labor Code by which the labor inspectorate was going to be charged with powers to oversee compliance with labor regulations and labor protecting norms and labor contracts. The new amendments will be enforced only starting July 1, 2021. Delay in enforcement is explained by lack of human, financial and institutional capacities needed for the inspectorate, therefore by that time, capacity building will be carried out.

The only visible “capacity building” noticeable since May 2018, has been appointment of a new head to the Health and Labor Inspectorate. Among his beliefs are statements such as, worker rights ‘should not be so fetishized”, “it is better for the worker rights suffer a bit, rather than business,” investors avoid countries with protected workers, where “their lives are doomed not only by the tax but also labor inspectorates.”