October, 2017

On September 27, 2017, Law of Ukraine no. 2058-VIII “On Amendments to Certain Legislative Acts of Ukraine on eliminating barriers to attracting foreign investment”, dated May 23, 2017 (hereinafter referred to as Law no. 2058-VIII) came into force.  Law no. 2058-VIII introduced changes in the following pieces of legislation:

  • Ukraine Code on Administrative Offenses;
  • Law of Ukraine “On the legal status of foreigners and stateless persons”;
  • Law of Ukraine “On employment”;
  • Law of Ukraine “On the Unified state demographic registry and proof of citizenship of Ukraine, verifiable identity or its special status”.

There were major changes applied regarding the Law of Ukraine “On Employment” – namely the order for processing permits for employing foreigners and stateless persons (hereinafter referred to as the work permit) have improved, so we propose considering these changes in greater detail:

First of all, Law no. 2058-VIII introduced such concepts as “foreign employee”, “sending foreign workers on business trips”, “foreign-paid professionals”, “foreign IT professionals”, “foreign artistic professionals” and also provides for the division of foreign workers in separate categories.  Specifically, the Law identified specific categories of foreigners and persons without citizenship, which established the non-application of certain requirements to obtain a work permit.  These groups are namely:

  • foreign-paid professionals;
  • the founders and/ or participants and/ or beneficiaries (controllers) of a legal entity established in Ukraine;
  • graduates of universities ranked in the world’s top 100 universities, according to the list determined by the Cabinet of Ministers of Ukraine;
  • foreign artistic professionals;
  • foreign IT professionals.

Also, Law no. 2058-VIII established a minimum wage, which the employer is required to pay foreign employees for processing a work permit.  Namely it is:

  • a sum not less than five times the minimum wage (16,000 hryvnia) – in voluntary associations, charitable organizations and educational institutions;
  • a sum not less than ten times the minimum wage (32,000 hryvnia) – for other categories of employees.

These requirements regarding the amount of the minimum wage does not apply in the case that the above-mentioned special categories of foreigners need to obtain a work permit, which is one of the differences in the design of special categories of foreigners and stateless persons.  A no less important difference, as provided for in Law no. 2058-VIII, is the possibility of the employer registering a work permit for a period up to three years for specific categories of foreigners.

A very important new change is a reduction in the list of documents required to obtain a work permit.  Until Law no. 2058-VIII came into effect, foreign workers tended to spend a lot of time and money on customs clearance and obtaining an Apostille in the country of origin of such documents as medical certificates and police clearance certificates.

From here forward, Law no. 2058-VIII abolished the requirement that these certificates had to be submitted, and established that the list of documents on priority work permits include the following:

  • a statement, according to the form prescribed by the Cabinet of Ministers, confirming that the position claimed by the foreign worker is not associated with holding Ukrainian citizenship and does not require access to state secrets;
  • a copy of the passport pages with the foreigner’s personal data, along with a translation into Ukrainian certified by a notary;
  • a color photograph of the foreigner, sized 3.5 x 4.5 cm;
  • a copy of the draft employment agreement (contract) with the foreigner, certified by the employer.

After Law no. 2058-VIII entered into effect, all employers using hired foreign labor faced a very important question as to whether the result must correspond to the size of the wage in relation to the work permits for foreign workers, issued before Law no. 2058-VIII entered into effect since such a procedure is not prescribed by legislation.

Having considered Department of Wages and Working Conditions of the Ministry of Social Policy of Ukraine Explanatory Letter no. 2413/0/101-17, dated September 18, 2017, it can be concluded that the requirements for the amount of wages, established in Part 3 of Article 421 of Law no. 2 058-VIII, shall apply to employers receiving a work permit for the first time or in the case that the authorization has been extended.  That is, together with a package of documents for extending the work permit, the employer shall additionally submit a copy of the employment contract, defining the foreigner’s wage conditions and corresponding to requirements regarding the amount of the minimum wage established by Law no. 2058-VIII.

Changes that can be attributed to more organizational issues include an increase in the fee for issuing a work permit and establishing a payment for extending the authorization period.  The fees for obtaining and extending a work permit, as established under Law no. 2058-VIII, is as follows:

  • for the issuance or extension of a work permit up to 3 years, the cost is the equivalent of six times the subsistence minimum payment for able-bodied persons;
  • for the issuance or extension of a work permit from 6 months to 1 year, the cost is the equivalent of four subsistence minimum payments for able-bodied persons;
  • for the issuance or extension of a work permit up to 6 months, the cost is the equivalent of two subsistence minimum payments for able-bodied persons;

Along with these changes with respect to establishing payment for extending a work permit, another positive point is a decline in the number of applications for extending a work permit for up to three working days.

Taking into account the above-mentioned changes in legislation, the process of processing documents to employ foreign workers in Ukraine has greatly improved.  According to EBS company lawyers, with the adoption of Law no. 2058-VIII, the employment of foreigners in Ukraine has become more attractive to employers and accessible to them.

Author: Maksim Leschinsky

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2017-11-01T09:24:52+00:00 01.11.17|Legal practice|