HR’s Role in the Ukraine Crisis
Workspan Daily
April 05, 2022
Key Takeaways

  • Employers are making the war in Ukraine “personal.” Companies around the world are providing aid to their employees in the Ukraine by helping them relocate while continuing to pay their salaries.
  • Displaced workers. Thousands of highly-skilled Ukrainian refugees are being sought after in other countries.
  • Impact on Russian workforce. According to one list, almost 500 companies have exited Russia, but even though a company has ceased operations in the country, they still have obligations to pay employees, leases and utilities. Sanctions have also affected industries, such as financial institutions, energy and transport sectors, and foreign airlines.

A month has passed since Russia’s invasion of Ukraine, and the repercussions are still being seen around the world. According to the UNHCR, the UN Refugee Agency, over 6.5 million people are displaced inside Ukraine and 3.7 million people have been forced to flee the country.

At the start of the crisis, companies were focused with helping their employees in Ukraine safely escape. 

French pharmaceutical company Ipsen convened a crisis committee with two key objectives: ensuring the safety of their employees and maintaining access to treatments for patients, according to a statement. The company also provided humanitarian relief to the people of Ukraine via a donation of €1.5 million.

CNBC reported JustAnswer, a San Francisco-based tech company, with 252 employees based in offices around Ukraine, help relocate employees and their families to safer locations, paying for moving fees, rent on new leases, hotel stays and bus fare.

The company also committed to continue paying the salaries of any employee who got drafted or chose to volunteer to join the Ukrainian military during the war.

“It doesn’t just affect people in Ukraine or Russia or Eastern Europe. This affects all of us globally,” JustAnswer CEO Andy Kurtzig said. “This is about democracy, freedom and opportunity. What we’re doing is not just about JustAnswer or a few employees. This is personal.”

Many other companies have made the war “personal” when it comes to their Ukrainian employees. 

recent Mercer survey found that among companies that are unable to operate in Ukraine, 63% of respondents were providing employees temporary leave with pay while 19% were relocating to locations outside of Ukraine. In addition, nearly 50% of companies have also evacuated Ukrainian employees and immediate family upon request. 

“Right away, employers made stability and care a priority for their employees,” said Melissa Swift, US transformation leader at Mercer. 

Despite dealing with a global health pandemic for the past two years, companies learned the invasion of Ukraine wasn’t a “copy and paste” situation. “Companies really had to listen to what (employees) really needed,” Swift said. 

Now that attention has shifted from getting employees out of conflict zones, Swift said the focus is now on transitioning to a longer-term plan on how to support these employees, whether that’s providing mental health support or assisting displaced workers. 

And although the scale is “massive,” said Swift, COVID showed the mobility of workforces, and she encouraged employers to hang on to those “highly-skilled workers” in Ukraine.

The New York Times recently reported that “thousands of jobs are being offered exclusively to Ukrainian refugees by on-the-ground recruitment agencies and through a vast network of online job boards that has sprung up across social media.”

“In Germany, where over 300,000 jobs are unfilled, a group of entrepreneurs created JobAidUkraine to help refugees find work as they arrived by rail, bus and air,” said the publication. “On a recent day, nearly 30,000 online visitors scrolled through over 5,000 jobs listed by companies from London to Lisbon, for McDonald’s shift work, human resources specialists, software developers and nursing aides.”

In Lithuania, with 20,000 Ukrainian refugees, companies are finding ways to accommodate working mothers, Inga Balnanosiene, the director of employment services at the Lithuanian labor ministry, told the Times.

Many of those arriving have diplomas, including journalists, lawyers, tech programmers and engineers, while others have worked in skilled labor positions, she said. Companies have set up on-site kindergartens or day care centers, allowing newcomers to be near their children as they take on roles as healthcare workers, teachers, programmers and seamstresses.

“This will help solve our labor shortage problem, even temporarily, and our people are not afraid that they will lose their own jobs, because we have enough for everyone,” Balnanosiene said.

Global Impact

Since the week of Feb. 28, Yale University professor Jeffrey Sonnenfeld and his research team have complied a list of businesses that have withdrawn from Russia. To date, they list almost 500 companies who have exited. 

Daniel Waldman, a partner at Seyfarth Shaw LLP, explained in a recent webinar, that when the media reports a business has “suspended, paused, or ceased operations” in Russia, there are different connotations to those words. Even if companies announce they’re exiting, it doesn’t mean they are stopping payments to employees, leases or utilities, he said. They still have to continue to fulfil legal and contractual obligations. 

Marjorie Culver, another partner at Seyfarth Shaw LLP, said there is also difficulty with terminating employees in Russia due to those obligations. In Russia, there is a usually a general director who has a responsibility to employees, and that director needs to be on board if a parent company wants to reduce headcount.

If a foreign company wants to dismiss employees, a Russian judge will likely not make that legitimate, Culver said, so businesses are grappling with how to truly exit the country. But there is a time limit to keeping those companies open if no new revenue is being generated. 

“The next decision is how long to keep affiliates afloat,” she said. 

Littler Mendelson P.C. is a U.S.-based law firm that handles labor and employment litigation as well as global mobility and immigration issues. In a recent article, the firm touched on how “the United States, United Kingdom, European Union, and a host of other jurisdictions have imposed sanctions against certain Russian corporate entities and individuals, as well as against the Russian state as a whole.”

These sanctions cover financial institutions, bank transactions, energy and transport sectors, and a ban of foreign airlines. 

Littler also explained how workforces in Russia are being impacted, such as limited ability to pay workers in Russia; mass layoffs/ceasing operations/divesting and dissolving Russian legal entities; and expats stuck in Russia. 

According to Littler, “the ripple effect of the conflict as well as the sanctions will inevitably impact other countries that rely on trade and business with Russia and Ukraine…Employers should also be sensitive to the emotional impact of the situation. 

“Employees who see colleagues and their families directly affected by the military activity may find it difficult to focus on business as usual. It is important that employers show that they are aware of this, and that they are not perceived as blind to or unmoved by the human impact.”

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