IMPACT – MEDIUM

What is the change? Companies will no longer be required to conduct a local labor market search before filling positions with foreign nationals under a new immigration law.

What does the change mean? While legal provisions requiring labor market searches have been removed, applicants are nonetheless advised to continue advertising job vacancies for the time being. This is because the government decree detailing how work permit procedures work has yet to be updated under the new law.

  • Implementation time frame: Ongoing. The law took effect in September but the relevant government decree has not yet been updated.
  • Visas/permits affected: Work permits.
  • Who is affected: Employers and foreign nationals applying for work permits.
  • Business impact: Assuming government processes are updated as expected, businesses will no longer be required to advertise job vacancies before recruiting foreign nationals for certain positions.

Background: The change to Ukraine’s labor market testing process is one of number of changes to take effect under a new law that overhauls the procedures for obtaining work and residence permits. Among other changes, the law abolishes labor market testing requirements in favor of imposing minimum salaries for foreign workers. The law also says that the availability of domestic labor is no longer grounds for the government to reject a work permit application.

The salary scheme requires employers to pay foreign employees at least 10 times the statutory minimum wage for Ukrainian workers. Currently, the wage minimum for Ukrainian workers is 3,200 hryvnias (about US$122) per month. This means the salary minimum for foreign employees will be 32,000 hryvnias per month. Exceptions are available for foreign employees working at nongovernmental organizations, charities, schools or other educational institutions. Employees working at such organizations will be required to receive a salary of at least 16,000 hryvnias per month. Wage requirements do not apply at all to graduates of top 100 universities (as specified in international rankings used by the Ukrainian government), IT professionals working at software companies or employees working on projects that will result in copyrighted material or patented goods.

BAL Analysis: The change eases recruitment processes for those hiring foreign nationals in Ukraine. While employers are advised to continue advertising vacancies for the time being, Ukraine’s new law makes it clear that authorities should no longer consider the availability of domestic workers when making decisions on whether to issue a work permit. Employers should be sure, however, that they are meeting minimum salary requirements as mandated under the new law.