Uzbekistan

Employment

There are two types of employment contracts – fixed term and unlimited period of time. Employment contracts must be written and the employer must provide an employment book at the time of hire.

Payroll

Monthly salary must be paid in full by the 10th of the following month.

HR & Labor

Working hours: Full time employment is considered 40 hours per week. Overtime must not exceed 4 hours within 48 hours and 120 hours per year. Overtime is compensated at 200% of regular wages.

Immigration

Business and employment visas are issued by the Embassy from the Ministry of Foreign Affairs. Work permits are issued by the Ministry of Labor and Social Protection of Population. They are valid from 3 months to 12 months and must be extended further.

Recruitment

The recruitment industry is underdeveloped in Uzbekistan, the hiring of any top management or other qualified candidates is most effective through personal or company networking.

Staffing

Outstaffing is a technology of HR management, when a provider hires new or existing staff of his customer. The provider ensures proper HR administration on daily basis, prepares accounting reports, carries out calculation and remittance of relevant taxes, accrues and executes salary payments, benefits, business trip allowances,
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prepares sick leave and other HR and accounting documentation in accordance with legislation of Uzbekistan. Within the framework of outstaffing engagement, an employment contract or a service contract is concluded with an employee. Thus, specific rights and obligations of the employer are transferred to a provider, while basic management processes are kept with the customer, where employees continue to work.

Minimum wage

Minimum wage is 149,775 UZS per month.

Paid off holidays

There are 9 official holidays (not paid).

September 1: Eid al-Adha
September 1: Independence Day
October 1: Teachers Day
December 8: Constitution Day

January 1: New Years Day
March 8: International Women's Day
March 21: Navruz
May 9: Day of Memory and Honor
June 15: Eid al-Fitr
August 21: Eid al-Adha
September 1: Independence Day
October 1: Teacher's Day
December 8: Constitution Day

Pension fund

Employees contribute 8% of their wages to their pension fund (optional for foreign nationals).

Severance payments

Severance payments are provided in legislation, but in very limited cases.

1) In accordance with conditions of the employment contract, if severance payments are stipulated;
2) When the employer terminates the contract on the grounds of changes in technology, organization of production and labor, reduction of volume of work involving changes in staff or in the nature of work or liquidation of company, the employer and employee may agree that the Two-month notice period may be substituted by an average salary for two months with immediate termination.

1) In accordance with conditions of the employment contract, if severance payments are stipulated.

Advance notice

Employer must provide two-month notice if the termination is connected with changes in technology, organization of production and labor, reduction of volume of work involving changes in staff or in the nature of work or liquidation of company.

Employee must provide two-week notice in writing.

Termination procedure

The employment contract may be terminated:
1) by mutual agreement of both parties;
2) at initiative of one of the parties;
3) upon expiration of the term of employment contract;
4) due to circumstances beyond the parties' control;
5) on grounds stipulated in the employment contract;
6) other.

Employers can unilaterally terminate employment contract on the following grounds:
1) Change in technological, production or work process, decrease in volume of work, which have led to changes in the number of staff (redundancy), character of work or liquidation of company;
2) Incompatibility of an employee due to low qualification (with sufficient evidence) or illness (that prohibits employee to perform duties);
3) Systematic breach of duties by an employee;
4) A significant breach of professional duties that are stipulated in employer’s policies;
5) Termination of part-time employees if the employer hires a full-time employee for this position;
6) Termination of a head of company, his deputy and chief accountant due to change of owner;
7) Reaching pension age provided that an employee has acquired the right to receive state pension (pensioner’s certificate).

Upon expiry of two-week notice period, the employee has the right to cease work, while the employer must issue to the employee the documents associated with his labor activities and any payments due thereto.

Sick Days

Employees are entitled to 60-80% of their regular wages for sick leave. The initial sick leave period is 5 days, which can be extended for up to 4 months.

Vacation Days

Employees receive 15 days or more paid vacation days, depending on the original employment contract.

Additional benefits / information

The salaries are paid in Uzbek Soums.

Benefits: Mobile and internet services, medical and life insurance, car expenses compensation, etc.
Quarterly and annual bonuses depending on results.

Income tax brackets

• Income tax: Residents and non-residents are subject to taxation on employment income at progressive rates up to 23%.
• Social security: The employee and employer respectively contribute 8% (as pension tax) and 15%-25% of the gross salary to social security in Uzbekistan. Non-residents are not subject to pension tax in Uzbekistan.

Additional employee withholdings

Employees are subject to employment income tax at progressive rates up to 23%.