A top UK executive who opposed to “brutal” staff wage cutbacks during the pandemic and was fired by the Russian oligarch behind Stolichnaya vodka has won a £1.6 million award.
Vlad Zabelin, a Chief Investment Officer making £180,000 a year, was sacked over the phone for complaining about pay cuts while the company was still profitable, according to evidence presented at an employment tribunal.
Even though the company was still doing well, his employer, Yuri Shefler, a vodka magnate worth $2 billion according to Forbes, had cut the wages of all 2,000 of his employees by 30% when Covid hit.
The owner of S.P.I. Group, Shefler, was accused by Mr. Zabelin of “using the pandemic as an excuse to slash salary without any transparency” and making “unnecessary” wage reductions.
Then, as “punishment,” Shefler fired Mr. Zabelin of London, who also griped about not receiving his up to £180,000 annual bonus.
However, after successfully suing 54-year-old Shefler, who is married to a Victoria’s Secret model, for whistle-blowing and wrongful dismissal, Mr. Zabelin has received a sizable compensation totaling £1,626,452.07.
Mr. Zabelin is presently negotiating terms in a new position as CEO of an international mining company, it was revealed at a remedies tribunal hearing.
In March 2020, Mr. Zabelin, who served as Group Chief Investment Officer for Shefler’s business, which exports alcohol to 170 nations, first consented to a 30% pay cut for three months owing to the epidemic.
He opposed, though, when he learned that it would go on indefinitely.
When workers in New York were being subjected to “severe pay cuts,” Mr. Zabelin discovered that “expensive” investment options were still being investigated in America.
Senior officials in Luxembourg, where the business is headquartered, told Mr. Zabelin that the cuts had resulted in “an environment of disarray and misery.”
The change in how bonuses would be calculated, according to Mr. Zabelin, would have a “substantial detrimental effect” on employee motivation and morale in addition to creating a hostile work environment and harming mental health.
He alleged that SPI was “not being honest” and “used the epidemic as an excuse to make choices that were unfavourable to workers.”
Shefler phoned Mr. Zabelin in June 2020 and “expressly” terminated him throughout the conversation.
According to Mr. Zabelin, [Shefler] stated that a bonus would only be taken into consideration if the recipient went above and above the call of duty.
When I explained that this was not what my employment contract stated, he instructed me to sign a letter of resignation if I didn’t agree.
When I questioned him about the need for a resignation letter, he reportedly said, “Forget about everything, I am firing you,” before hanging up.
Employment Judge Lewis found Shefler “lost his patience” and was “annoyed” already when Mr. Zabelin voiced concerns about pay cutbacks and bonuses when the judge was seated at London Central.
There were no protocols followed at all, according to Judge Lewis. Mr. Zabelin was abruptly informed that he had been sacked while the two of them were talking about his issues regarding compensation and bonus reductions.
There was no doubt about the Group’s strong cash flow and ongoing profitability. Furthermore, Mr. Zabelin had not yet reached the point of refusing to accept the reduction.
He was in the process of making his case and requesting clarity regarding the proposal.
Even if they had decided to follow fair procedures, “no reasonable employer would have terminated for this reason in these circumstances.”
The judge continued, “Mr. Zabelin expressed worry that SPI was exploiting the pandemic as a justification to decrease compensation without any transparency. This, in his opinion, usually indicates a breach of faith and trust.
He had a good reason to think this. He was aware that SPI may continue to participate in pricey mergers and acquisitions based on his own continuing projects and directives.
The SPI Group is a sizable international business with well-known products. The majority or all of the 2,000 employees seem to have been affected by the cuts.
It is plausible to assume that during the Covid era, there was curiosity in the effects on workers, particularly whether companies were unduly reducing employee compensation and how workers could have felt about it.
An uncapped wage decrease of 30% was noteworthy.
Shefler called the claimant as soon as he had the chance after relaying Mr. Zabelin’s objections to him.
He began by discussing the [bonus] but quickly lost patience when Mr. Zabelin brought up his job contract.
If Shefler hadn’t already been displeased with Mr. Zabelin’s overall position, “we doubt that Shefler would have lost his patience quite so rapidly and to the point of terminating Mr. Zabelin.”
Shefler failed to provide any evidence at the tribunal, leading Judge Lewis to declare the dismissal to be “out of hand.”
Judge Lewis granted Mr. Zabelin £1,626,452.07 in restitution for his financial damages sustained as a result of his dismissal, as well as for his claims of unfair dismissal and whistleblowing against Shefler and SPI Spirits (UK) Limited, the group’s UK division.
According to information provided to the remedial hearing, Mr. Zabelin was in the process of negotiating a new post as the CEO of a “major UK-registered mining firm” that is listed on the AIM stock exchange and mostly operates in Russia.
Shefler has four children with Tatiana Kovylina, a 40-year-old Russian Victoria’s Secret model.
On Forbes’ list of the richest billionaires in the world in 2021, he was ranked number 1205.
The Stolichnaya vodka that Shefler acquired from the government-owned VVO Soyuzplodoimport in 1997 for $285,000 is the product for which S.P.I Group is best known.
Later, the transaction was determined to be unlawful, and the sale of vodka is now prohibited in Belgium, the Netherlands, Luxembourg, and Russia.
Following the Kremlin’s invasion of Ukraine earlier this year, it has since changed its name to Stoli.
The mega-yacht Serene was once owned by Shefler, who sold it to Mohammed bin Salman, the deputy crown prince of Saudi Arabia, in the summer of 2014.