Sanctioned Russian Oligarch Mikhail Fridman worth £11bn wins employment tribunal against housekeeper
A judge determined that it would be unlawful for the sanctioned Russian billionaire to pay his housekeeper, and as a result, he won an employment dispute.
After the invasion of Ukraine, Dominika Kozlik was employed by Mikhail Fridman’s £65 million London mansion, but she was on maternity leave when the British government attacked him.
Russian Oligarch Mikhail Fridman
The 59-year-old Russian-Israeli entrepreneur, who was born in Ukraine, is estimated to be worth £11 billion. As a result of the sanctions, his bank accounts have been banned.
Paying his housekeeping crew was later declared unlawful by a High Court verdict.
As a result, Ms. Kozlik’s monthly maternity benefits were discontinued, and in March 2023, she was finally fired from her position at Athlone House in Highgate.
She tried to sue Mr. Fridman for breach of contract, sex discrimination, and unjust dismissal due to her pregnancy.
However, a judge dismissed her claims, concluding that she was merely a “victim of processes.”
The millionaire purchased Athlone House in 2016 and is one of the co-founders of Alfa Group, a Russian corporation.
According to the Sunday Times Rich list, he was the 11th richest individual in the UK in 2021 and was estimated to be worth £10.8 billion.
Ms. Kozlik, who had been an agency worker for Mr. Fridman since 2015, was informed at the Watford hearing that she began working as a housekeeping assistant at the residence in March 2021.
She began her maternity leave in November 2021 intending to return to work 12 months later. It was decided that she would get a monthly payment of £1,500.
But once Russia invaded Ukraine in Match 2022, Mr. Fridman was subject to sanctions, which led to the “blocking” of his Barclays bank account.
Consequently, Ms. Kozlik lodged a complaint with her manager, who notified her that the company was subject to sanctions and was waiting for a license to continue offering services, which meant the salaries would be delayed.
It was explained to the hearing that “individuals may be ‘designated’ by the Secretary of State and made subject to sanctions, including economic sanctions,” as per the Russian Regulations.
“Under the Russian Regulations, designation results in the freezing of an individual’s financial resources and assets.” Such resources and assets can only be used with a license or licenses that have been obtained from OFSI.
Her Majesty’s Treasury’s Office of Financial Sanctions Implementation (OFSI) is in charge of managing the licensing program by Russian regulations.
‘OFSI did not think that maternity pay or compensation for housekeeping services like [Ms. Kozlik’s] should be regulated, and the High Court did not think that the decision was illegal.
“Mr. Fridman’s challenge to OFSI’s denial of his application for a license about payments to Athlone House for payment to staff for household-related services” was denied by the High Court.
A license allowing Mr. Fridman and his dependents to receive “monthly basic needs allowances” was granted by OFSI in June 2022; however, housekeeping assistants were not included in this.
The court was informed that due to “Russian Regulations,” Mr. Fridman could not pay Ms. Kozlik “without [him] committing a criminal offense.”
She stated that he ought to have filed an appeal against the High Court’s ruling.
When she contacted HMRC in June 2022 regarding maternity pay, she was informed that it seemed her work had ended in March 2022.
When Ms. Kozlik was on maternity leave, she filed a complaint with her supervisors alleging that she was fired “against her will.”
She was informed, however, that sanctions had resulted in the termination of her contract and that “all the money and employment tax contributions owed to you will be settled” once the license was issued.
She was heard when she brought up the license issue once more in October 2022 and it was “suggested she apply for Universal Credit.”
Mr. Fridman’s license to provide household-related services was denied by OFSI in December 2022. All non-licensed employees—apart from Ms. Kozlik—were laid off in February 2023, and she learned that her employment was terminated in March.
Employment Judge Elizabeth McNeill KC rejected her claims before a full hearing could take place, stating: “It was absolutely clear that the impact of the imposition of sanctions under the Russian Regulations and not any of the protected characteristics she relied on was the reason why [Ms. Kozlik’s] employment was terminated and her maternity payments stopped.”
“[Ms. Kozlik] is in fact a victim of uncontrollable processes.”
“The uncontested documentary evidence demonstrates that the clear and sole reason for her treatment was that [Athlone House Ltd] could no longer pay her because of the impact of the imposition of sanctions under the Russian Regulations,” even though her absence on maternity leave provided the factual context in which she was dismissed and her maternity pay was stopped.
“I came to the conclusion that [Ms. Kozlik] has no realistic chance of demonstrating that her sex, pregnancy, or maternity had a substantial impact on the reason she was fired and did not receive continuing maternity pay.”
The US and the EU have also imposed sanctions on Fridman.
More than fifty National Crime Agency officers stormed Athlone House in December 2022, although the inquiry has since been ended.
In addition to being a co-founder of Alfa Bank, the biggest private bank in Russia, Fridman formerly served as a director of LetterOne, which holds Holland & Barrett stock, before resigning from the role last month.
The European Union (EU) sanctioned the banking and investment firm tycoon on February 28 in response to Russia’s invasion of Ukraine. In interviews, the tycoon had previously stated that he was living off home-cooked meals at his estate, Athlone House, which is located on the edge of Hampstead Heath.
