UK executive sacked by Russian billionaire vodka boss wins £1.6m
Senior £180,000-a-year UK executive sacked by Russian billionaire behind Stolichnaya vodka after he objected to ‘brutal’ 30% staff pay cuts at profit-making alcohol firm during pandemic wins £1.6m in unfair dismissal claim
- Vlad Zabelin was fired over the phone for complaining about salary reductions
- Vodka boss Yuri Shefler cut the pay of 2,000 workers despite good performance
- Mr Zabelin wins over £1.6m after suing for whistle-blowing and unfair dismissal
A senior UK executive sacked by the Russian billionaire behind Stolichnaya vodka when he objected to ‘brutal’ staff pay cuts during the pandemic has won a £1.6m payout.
Vlad Zabelin, a £180,000-a-year Chief Investment Officer, was fired over the phone for complaining about salary reductions as the firm was still making profits, an employment tribunal heard.
His boss, Yuri Shefler, a vodka tycoon worth £2 billion according to Forbes, had slashed the pay of all his 2,000 workers by 30 per cent when Covid hit, even though the business was still performing well.
Mr Zabelin raised concerns that Shefler, owner of S.P.I. Group, was ‘using the pandemic as an excuse to cut pay without any transparency’ and that cuts were ‘unnecessary’.
Shefler then sacked London-based Mr Zabelin to ‘punish’ him, who also complained that he would not receive his annual bonus of up to £180,000.
But now Mr Zabelin has won a substantial payout totalling £1,626,452.07 after successfully suing 54-year-old Shefler – who is married to a Victoria’s Secret model – for whistle-blowing and unfair dismissal.
Yuri Shefler (left) fired Chief Investment Officer Vlad Zabelin (right) over the phone to ‘punish’ the £180,000-a-year executive for complaining about the cuts
Shefler is married to Russian Victoria’s Secret model Tatiana Kovylina, 40, with whom he has four children
The iconic Stolichnaya vodka: One of the oldest vodka brands in Russia
Origins of the famous vodka brand are debated, bit Sojuzplodoimport, the brand’s owner, claims the the first Stolichnaya bottles were produced in 1941, in besieged Leningrad, with mass production starting in 1943.
Considered a premium vodka, its prices were high and it was soon granted the nickname ‘Stoli’.
It’s heyday was in the 80s, and by 1990, Stolichnaya vodka was being exported to 90 countries.
It featured in comedy Absolutely Fabulous as a key component of the Stolli-Bolli cocktail – a mix of Champagne and vodka.
In 1997, Yuri Shefler created Sojuzplodimport, acquired Stolichnaya, sold it to his other company (Spirits International, in the Netherlands) and founded S.P.I. Group.
Shefler bought Stolli from state-owned VVO Soyuzplodoimport for $285,000 but the sale was later ruled illegal and the vodka is banned from being sold in Russia, the Netherlands, Luxembourg and Belgium.
A remedy tribunal hearing was told Mr Zabelin was currently negotiating terms in a new role as CEO of an international mining company.
Mr Zabelin worked as Group Chief Investment Officer for Shefler’s company – which supplies alcohol to 170 countries – and in March 2020 initially agreed to a 30 per cent pay cut for three months due to the pandemic.
However, when he was informed it would continue without an end in sight, he objected.
Mr Zabelin had learnt that ‘expensive’ investment opportunities were still being explored in America when employees in New York were facing ‘brutal pay cuts’.
Speaking to senior executives in Luxembourg, where the company is based, Mr Zabelin was told the cuts created ‘an environment of mess and despair’.
Mr Zabelin complained the pay cuts created a toxic environment and would negatively affect mental health while a change to how bonuses would be calculated would have a ‘significant negative effect’ on employee motivation and morale.
He claimed SPI was ‘not being transparent and was using the pandemic as an excuse to make adverse decisions against staff’.
In June 2020, Shefler called Mr Zabelin and ‘expressly’ fired him during the conversation.
Mr Zabelin said: ‘[Shefler] said that a bonus would only be considered if a person does [something] extra, outside of such person’s scope of work.
‘When I told him that this was not what my employment contract was saying he told me ‘then sign a resignation letter if you don’t agree’.
‘When I asked him why I should sign a resignation letter, he told me literally ‘forget about everything, I am firing you’ and hung up.’
S.P.I Group is best known for selling Stolichnaya vodka, which Shefler bought from state-owned VVO Soyuzplodoimport for $285,000 in 1997
Married to a Victoria’s Secret model and selling vodka that is banned in 4 countries: Who is Yuri Shefler?
Yuri Shefler, 54, is a vodka tycoon worth £2 billion according to Forbes.
The owner of S.P.I. Group shares four children with his wife, Russian Victoria’s Secret model Tatiana Kovylina, 40.
In 2017 he bought what is believed to be the most expensive sporting estate in the Scottish Highlands – after agreeing to pay £25million.
The S.P.I Group, which produces and sells alcohol under 380 brands in 160 counties, is worth an eye-watering £1.3billion.
He bought the company which owns the Tulchan Estate – a 21,000-acre property 40 miles south of Inverness – four years ago. The area boasts some of the best salmon fishing in Europe.
It had been owned by the Litchfield family before it was sold to Mr Shefler’s company.
In 2021, Mr Shelfer was listed at 1205 in Forbes’ list of the world’s richest billionaires.
S.P.I Group is best known for selling Stolichnaya vodka, which Shefler bought from state-owned VVO Soyuzplodoimport for $285,000 in 1997.
The sale was later ruled illegal and the vodka is banned from being sold in Russia, the Netherlands, Luxembourg and Belgium.
Shefler used to own the megayacht Serene but sold it to Mohammed bin Salman, Saudi Arabia’s deputy crown prince, in the summer of 2014.
Employment Judge Lewis, sitting at London Central, ruled Shefler ‘lost his patience’ and was already ‘annoyed’ at Mr Zabelin raising concerns about cuts and bonuses.
Judge Lewis said: ‘No procedures were followed whatsoever. In the middle of a conversation to discuss his concerns about pay and bonus cuts, Mr Zabelin was told out of the blue that he was fired.
‘It was clear the Group had good cash flow and was still making profits. Further, it had not got to the point of Mr Zabelin refusing to accept such cuts.
‘He was at the stage of arguing his case and asking for transparency about what was proposed.
‘No reasonable employer would have dismissed for this reason in these circumstances, even had they chosen to follow fair procedures.’
The judge added: ‘Mr Zabelin expressed concern that SPI was using the pandemic as an excuse to cut pay without any transparency. He believed this tended to show a breach of trust and confidence.
‘It was reasonable for him to believe this. He knew from his own ongoing projects and instructions that SPI was able to continue to engage in expensive mergers and acquisitions.
‘The SPI Group is a fairly large international company with high profile products. The cuts appear to have applied to most or all of 2,000 employees.
‘It is reasonable to believe that at a time of Covid, there was public interest in the impact on employees including whether employers were unnecessarily cutting pay of staff, and on how employees might have felt about it.
‘An open-ended 30 per cent pay cut was significant.
‘Shefler had telephoned the claimant at the first opportunity after Mr Zabelin’s objections had been conveyed to him…
‘He started by talking about the [bonus] and lost patience as soon as Mr Zabelin referred to his contract of employment.
‘We doubt that Shefler would have lost his patience quite so quickly and to the point of dismissing Mr Zabelin if he had not already been annoyed about his wider position.’
Shefler did not provide evidence at the tribunal and Judge Lewis concluded the sacking was ‘out of hand’.
Judge Lewis awarded Mr Zabelin £1,626,452.07 in compensation for his unfair dismissal and whistleblowing claims against Shefler and SPI Spirits (UK) Limited – the UK subsidiary of the group – as well as for financial losses incurred due to his dismissal.
The remedy hearing was told Mr Zabelin was currently negotiating a new position as CEO of a ‘large UK-registered mining company’ which is listed on the AIM stock exchange and works mainly in Russia.
Shefler is married to Russian Victoria’s Secret model Tatiana Kovylina, 40, who he has four children with.
In 2021, he was listed at 1205 in Forbes’ list of the world’s richest billionaires.
S.P.I Group is best known for selling Stolichnaya vodka, which Shefler bought from state-owned VVO Soyuzplodoimport for $285,000 in 1997.
The sale was later ruled illegal and the vodka is banned from being sold in Russia, the Netherlands, Luxembourg and Belgium.
It has since rebranded as Stoli, following the Kremlin’s invasion of Ukraine earlier this year.
Shefler used to own the megayacht Serene but sold it to Mohammed bin Salman, Saudi Arabia’s deputy crown prince, in the summer of 2014.
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