Introduction
Exemptions
Categories of employee
Local employee ratio

Procedure for obtaining work permits


Introduction

The Labour Code (251-III, May 15 2007, as amended) is the primary legislative act governing labour relations. In addition, a number of laws and regulatory acts regulate labour and employment issues. This update discusses recent changes regarding the employment of foreign workers brought about by the adoption of the Rules and Conditions of Issuance of Permits to Foreign Employees and Employers for the Attraction of a Foreign Workforce, which were approved by Resolution 45 (January 13 2012).

In order to employ foreign specialists, companies must obtain work permits from a local department for employment and social programmes from the available quota, as approved annually by the government.

Exemptions

The rules do not apply to foreign citizens visiting Kazakhstan for business for less than 120 days within a period of 365 consecutive days.

The following foreign specialists are exempt from the requirement to obtain a work permit:

  • citizens of states which are parties to the Treaty on the Legal Status of Migrant Workers and Their Families (November 19 2010) – that is, citizens of the Russian Federation and Belorussia working in Kazakhstan;
  • heads of branches and representative offices of foreign legal entities;
  • chief executive officers of companies that are parties to investment contracts with the government worth $50 million or more, Kazakhstan legal entities that are conducting investment activities in priority sectors or parties to investment contracts with a competent state investment body;
  • crew members of sea and river vessels and air, railway and automobile transport; and
  • individuals working in the regional financial centre in Almaty as chief executive officers and specialists with post-secondary and higher education, documented in accordance with the law.

Categories of employee

The rules divide employees into four categories:

  • Category 1 – chief executive officers and their deputies;
  • Category 2 – "heads of structural divisions";
  • Category 3 – specialists who meet qualification requirements set out by law; and
  • Category 4 – qualified workers who meet qualification requirements set out by law.

The rules request foreign employees to demonstrate that their education, qualification and experience match the qualification requirements established by the Unified Tariff Qualification Manual of Works and Professions of Employees and the Qualification Manual of Managers, Professionals and Other Employees.

Local employee ratio

According to the rules, as of January 1 2012, employers must observe the following ratio of Kazakhstan employees to foreign employees:

  • not less than 70% of the payroll number of Kazakhstan employees for Categories 1 and 2; and
  • not less than 90% of the payroll number of Kazakhstan employees for Categories 3 and 4.

These ratio requirements do not apply to small businesses and state-owned entities, and to work permits issued within the quotas for priority economic sectors and for employment in special economic zones, or to those issued to foreign individuals who may apply for work permits independently (ie, without an employer).

Subject to the provision of certain documents, until January 1 2015 the ratios do not apply to subsoil users of the Karachaganak, the North-Caspian and the Tengiz projects and their operators and subcontractors.

Procedure for obtaining work permits

The process of obtaining work permits consists of the following stages.

The following documentation must be submitted to the relevant employment department alongside the application:

  • documents confirming that the employer has searched the local market, but found no local specialist with the necessary qualifications and experience for the vacant position; and
  • documents demonstrating that the experience and education/qualifications of the foreign specialist match the requirements set by law.

Within 15 business days, the employment department must issue an opinion confirming or rejecting the hiring of the foreign specialist.

Upon receipt of confirmation from the Employment Department, the employer must file an additional package of documents to finalise the procedure, including documents securing the departure of the foreign specialist on expiry of the work permit and confirmation of the deposit of funds by the employer with a Kazakhstan bank.

The Employment Department may refuse to issue a work permit if:

  • the documents are incomplete or incorrectly prepared; or
  • the foreign specialist fails to comply with the qualification requirements.

The rules have replaced secondment with a corporate exchange mechanism. 'Corporate exchange' is defined as the temporary transfer of a foreign or stateless person pursuant to a letter or an agreement on corporate exchange from a foreign legal entity to a branch, representative office or Kazakhstan-affiliated company of such foreign legal entity, with the aim of performing work and providing services. The rules require those taking part in a corporate exchange to obtain work permits. To date, the implementation of the corporate exchange mechanism and the issuance of work permits remain new and untested.

For further information on this topic please contact Yerzhan Kumarov at Norton Rose LLP by telephone (+7 727 311 24 80 88), fax (+7 727 311 24 89) or email (yerzhan.kumarov@nortonrose.com).

This article was first published by the International Law Office, a premium online legal update service for major companies and law firms worldwide. Register for a free subscription.