Kazakhstan

Understanding market competitive salaries in Kazakhstan is crucial for both employers and employees. A competitive salary attracts top talent and motivates existing employees, while underpaying can lead to recruitment difficulties and high turnover.

Factors Influencing Market Competitiveness

Several factors influence what constitutes a competitive salary in Kazakhstan:

• Job Title and Industry: Different industries offer varying salary ranges. IT specialists and developers, for instance, typically command higher salaries compared to factory workers.
• Experience and Skills: Employees with extensive experience and specialized skills can expect higher salaries than those with less experience or a more general skillset.
• Education: Educational qualifications often play a role in determining salary. For instance, some managerial positions might require a higher degree, leading to a higher salary range.
• Location: Salaries can vary depending on the city or region. Major cities like Astana and Almaty generally offer higher salaries compared to smaller towns.
• Company Size: Multinational corporations or larger domestic companies may offer more competitive salaries compared to smaller businesses.

The Republic of Kazakhstan guarantees its citizens the right to a minimum wage according to the Constitution. The minimum wage in Kazakhstan is established nationwide and the Law on State Budget sets the minimum wage amount annually.

Minimum Wage Calculation

The minimum wage is determined as both a monthly and hourly rate. It applies to work performed under normal conditions and fulfilling the set monthly work quota (working hours). Normal working hours in Kazakhstan are capped at 40 hours per week as per Article 77 of the Labor Code of the Republic of Kazakhstan.

Minimum Wage and Living Wage Relationship

The Labour Code mandates that the monthly minimum wage should not be lower than the living wage for an employed person.

Minimum Wage and Additional Payments

The minimum wage is a base salary and does not include additional benefits or payments.

Employer Responsibilities Regarding Minimum Wage

Employers are legally required to pay their employees wages that meet or exceed the minimum wage. Employers must provide a written or electronic payslip every month, detailing the wage components, amount, deductions (including mandatory pension contributions), and the total payable amount.

In Kazakhstan, the labor law mandates a strong foundation of statutory benefits, and companies often supplement these with additional perks to attract and retain top talent. Here's a breakdown of both mandatory and discretionary bonuses and allowances offered to employees in Kazakhstan.

Statutory Benefits

Statutory benefits are legally required by the government and form the base of an employee's compensation package in Kazakhstan.

• Paid Time Off: Employees are entitled to a minimum of 18 days of paid annual leave, along with 12 paid national holidays throughout the year.
• Social Security: Both employers and employees contribute to a social security system that provides benefits like pensions, healthcare, and maternity leave.
• Leave: In addition to annual leave, employees receive paid sick leave, maternity leave (up to 126 days), paternity leave, and other forms of leave as outlined by law.
• Overtime Pay: Work exceeding the standard workweek mandates overtime pay at a higher rate.

Discretionary Bonuses and Allowances

Many companies in Kazakhstan offer additional benefits to enhance their compensation package and attract skilled workers. Here are some common examples:

• Performance-Based Bonuses: Companies may offer bonuses tied to individual or company performance metrics to incentivize productivity and goal achievement.
• Housing Allowance: To help offset housing costs, some employers provide a housing allowance or even company-provided housing.
• Transportation Allowance: Companies may offer an allowance to cover commuting expenses, or provide a company car.
• Education Allowance: Some employers may offer financial assistance for employees pursuing further education or professional development.

In Kazakhstan, payroll processing adheres to specific regulations outlined in the Labor Code of the Republic of Kazakhstan. Salaries are paid on a monthly basis as per the law. There's no legal requirement for additional payments like a 13th-month bonus, although some employers might offer such benefits at their discretion.

Frequency

Salaries in Kazakhstan are paid on a monthly basis. There's no legal requirement for additional payments like a 13th-month bonus, although some employers might offer such benefits at their discretion.

Payroll Taxes and Deductions

Employers in Kazakhstan are responsible for withholding various taxes and social contributions from employee salaries before remitting the net pay. Here's a breakdown of the main contributions:

• Employee Income Tax: A flat rate of 10% is applied.
• Employer Social Contributions: Employers contribute a total of 9.5% towards social insurance, capped at specific thresholds based on the minimum monthly wage.
• Obligatory Professional Pension Contribution (OPPC): An additional 5% applies for employees working in hazardous conditions.