Employer of Record in Ukraine

An Employer of Record, or EOR, is a company that legally hires employees in Ukraine on your behalf. This lets you build a team in the country without setting up your own local company. The EOR handles all the official employment tasks like payroll, taxes, benefits, and making sure you follow Ukrainian labor laws. It’s a straightforward way to hire and manage people in Ukraine. For companies looking to hire in Ukraine, an EOR provider like Rivermate can manage the entire process for you.

How an Employer of Record (EOR) Works in Ukraine

Using an EOR simplifies the hiring process. You maintain control over your employee's daily work, while the EOR handles the legal and administrative parts of employment. Here is how it works.

• Agreement: First, you partner with an EOR and tell them what you need for hiring.
• Onboarding: The EOR hires your chosen candidates directly, making them the legal employer.
• Legal Compliance: The EOR creates an employment contract that follows all Ukrainian labor laws, which are detailed in the official Labor Code of Ukraine (https://zakon.rada.gov.ua/laws/show/322-08). This covers rules on working hours, vacation time, and how employment can be ended.
• Payroll and Taxes: The EOR manages all payroll, including paying salaries in the local currency, withholding taxes, and making social security contributions.
• Benefits Administration: They also handle all legally required employee benefits.

Why use an Employer of Record in Ukraine

Using an EOR in Ukraine allows you to grow your business and hire talented people without the cost and time of setting up a legal entity. It removes the administrative weight from your shoulders so you can focus on your main business goals. You get to work with Ukraine's skilled workforce while the EOR deals with the complexities of employment rules.

Here are some key benefits:

• Stay Compliant: The EOR makes sure you follow all local employment regulations. This is important because Ukrainian labor laws can be complex. The State Labour Service of Ukraine (https://dsp.gov.ua/) oversees these rules.
• Enter the Market Faster: You can hire employees and start operating in weeks, not months. It is much quicker than establishing a new company abroad.
• Reduce Costs: Avoid the high costs and paperwork associated with setting up a local company.
• Access Top Talent: Ukraine has a large pool of skilled professionals, especially in the tech industry. An EOR helps you hire them easily.

Rivermate's transparent pricing model eliminates complexity with a single, competitive monthly fee per employee. Unlike traditional PEO providers, our pricing in Ukraine includes comprehensive HR support, benefits administration, compliance management, and access to our proprietary dashboard for real-time workforce analytics. No hidden costs, no setup fees—just straightforward pricing that scales with your business needs while ensuring full legal compliance in Ukraine.

Hiring in Ukraine means tapping into a large pool of skilled professionals. The country has a strong reputation in the tech and IT sectors, but you can find talented people in many industries. To hire them, you need to understand the local labor laws. This guide will walk you through the key aspects of hiring in Ukraine, keeping it simple and straightforward.

Employment contracts & must-have clauses

When you hire an employee in Ukraine, a written employment contract is mandatory. This document is the foundation of your relationship, so it needs to be clear and compliant with Ukrainian law. While contracts can be for a fixed term in specific situations, most are indefinite.

Your employment contracts must include:

• Your company's and the employee's information: Full legal names, addresses, and tax identification numbers.
• Job details: A clear description of the role and responsibilities.
• Start date: The exact date the employment begins.
• Compensation: The salary, how often it will be paid, and any other benefits.
• Working conditions: This includes working hours and the primary work location.
• Termination procedures: The notice periods and reasons for ending the contract.

Probation periods

In Ukraine, you can include a probation period in the employment contract to see if a new hire is a good fit.

During probation, either you or the employee can end the contract with just three days' notice.

Working hours & overtime

The standard workweek in Ukraine is 40 hours, usually spread over five days. Anything beyond these hours is overtime.

Here are the rules for overtime:

• Limits: An employee can't work more than four hours of overtime in two consecutive days. The annual limit is 120 hours.
• Pay: Overtime work must be paid at double the employee's regular hourly rate.

During martial law, employees in critical infrastructure sectors may have their workweek extended to 60 hours.

Public & regional holidays

Employees in Ukraine are entitled to paid time off for public holidays. If a holiday falls on a weekend, the following Monday is typically a day off.

Here are the public holidays for 2025:

• January 1: New Year's Day
• March 8: International Women's Day
• April 20: Orthodox Easter Sunday
• April 21: Orthodox Easter Monday
• May 1: Labor Day
• May 8: Day of Remembrance and Victory over Nazism
• June 8: Whit Sunday (Pentecost)
• June 9: Whit Monday
• June 28: Constitution Day
• July 15: Statehood Day
• August 24: Independence Day
• October 1: Defenders Day
• December 25: Christmas Day

Hiring contractors in Ukraine

You can also hire independent contractors in Ukraine. This can be a flexible way to get specialized skills for specific projects. However, it's very important to get the classification right.

An independent contractor is self-employed. They manage their own work, pay their own taxes, and are not entitled to employee benefits like paid leave or social security contributions. Their relationship with you is governed by a civil law contract, not an employment contract.

Misclassifying an employee as a contractor can lead to serious problems. If the authorities decide a contractor is actually an employee, you could face:

• Fines and penalties
• Back payment of taxes and social security contributions
• Liability for unpaid leave and other benefits

An Employer of Record (EOR) helps you avoid these risks. We hire employees on your behalf, making sure they are classified correctly and that all local labor laws are followed. This lets you work with Ukrainian talent without the legal and administrative burdens of setting up a local entity.

Understanding compensation and payroll in Ukraine is straightforward. The system is designed to be clear for both you and your employees. Salaries are typically paid in the Ukrainian Hryvnia (UAH). The average monthly salary in 2025 is around 25,000 UAH, but this can vary based on the industry and region. For example, salaries in Kyiv are generally higher than in other parts of the country.

Payroll cycles & wage structure

In Ukraine, you will pay your employees twice a month. This bi-weekly payroll cycle is standard practice.

An employee's salary is made up of three main parts:

• Basic salary: This is the fixed amount you pay for the work done. It cannot be less than the national minimum wage.
• Additional salary: This includes payments for work that goes beyond the standard requirements. Think of it as compensation for overtime, night shifts, or working in difficult conditions.
• Other payments: This category covers bonuses and other incentive payments you might offer.

Overtime & minimums

The standard work week in Ukraine is 40 hours. Any work beyond this is considered overtime. You can ask an employee to work a maximum of four hours of overtime in two consecutive days, and no more than 120 hours per year. For any overtime hours, you must pay double their regular hourly rate.

As of January 1, 2025, the minimum wage in Ukraine is:

• 8,000 UAH per month
• 48.00 UAH per hour

Employer taxes and contributions

As an employer in Ukraine, your main payroll contribution is the Unified Social Contribution (USC). This covers pensions, unemployment insurance, and other social benefits for your employees.

Employee taxes and deductions

You are responsible for withholding taxes from your employees' salaries and remitting them to the tax authorities. The two main deductions are the Personal Income Tax and the Military Tax.

In Ukraine, providing the right benefits and leave is key to attracting and keeping great talent. It's not just about following the law; it's about creating a supportive workplace. Understanding the local landscape of statutory and supplemental benefits helps you build a competitive package that meets employee expectations.

Statutory leave

Ukrainian labor law mandates several types of leave to protect employees.

• Annual Leave: You must provide employees with a minimum of 24 calendar days of paid vacation each year. Certain professions, like teachers and government workers, are entitled to more.
• Sick Leave: Employees can take paid sick leave when ill. You cover the first five days, and the Social Insurance Fund of Ukraine handles payments after that. A medical certificate is required to claim this benefit.
• Maternity Leave: Mothers get 126 calendar days of paid maternity leave. This is typically split into 70 days before the birth and 56 days after. In cases of multiple births or complications, the leave extends to 140 days. The social insurance fund covers 100% of the employee's average salary during this time.
• Paternity Leave: Fathers can take up to 14 days of paid leave after the birth of a child.
• Parental Leave: After maternity leave, either parent can take unpaid leave until the child turns three. Their job is held for them during this period.

Public holidays & regional holidays

Ukraine has a number of official public holidays. If an employee works on a public holiday, they are entitled to double pay or another day off.

Typical supplemental benefits

To stay competitive, especially in fields like IT, many companies offer benefits beyond the legal requirements.

How an EOR can help with setting up benefits

Navigating a new country's labor laws and benefit expectations can be complex. An Employer of Record (EOR) simplifies this for you.

An EOR acts as the legal employer for your team in Ukraine. We handle all the administrative tasks, including:

• Compliance: We ensure your benefits packages meet all of Ukraine's legal requirements.
• Administration: We manage payroll, leave tracking, and contributions to social funds.
• Local Expertise: We provide insight into local market expectations for supplemental benefits, helping you create a competitive offer.
• Onboarding: We streamline the process of getting your new employees set up with all their benefits from day one.

Using an EOR allows you to focus on growing your business, confident that your team is taken care of.

Ending a working relationship in Ukraine involves clear rules set by the country's labor code. You need to follow specific steps to make sure everything is done legally and smoothly. If you don’t follow the correct procedures, you could face legal problems, like having to rehire the employee or pay fines. It's important to understand notice periods, reasons for dismissal, and severance pay to manage your workforce in a compliant way.

Notice periods

How much notice you need to give an employee depends on why the employment is ending.

Severance pay

In some situations, you have to provide severance pay. The amount is usually based on the employee's average monthly salary.

Here are some common scenarios where severance pay is required:

• Redundancy or changes in the company: If you dismiss an employee due to changes in your organization, you must pay at least one average monthly salary.
• Employee is unfit for the job: If an employee is not suitable for their position, they are entitled to one month's salary.
• Employer breaks the law or contract: If you violate labor laws or the employment contract, the employee may be entitled to three months' pay. For company officers, this can be up to six months' wages.

How Rivermate handles compliant exits

We make sure every termination follows Ukrainian labor law. We handle the process from start to finish so you don't have to worry about compliance.

Here’s how we manage the process:

• Documentation: We prepare all the necessary paperwork, including the formal termination order.
• Final pay calculation: We calculate and process the employee's final salary, including any unused vacation days and severance pay. All payments are made on the employee's last day.
• Clear communication: We make sure the employee receives all required documents, such as their work book, on their last day.
• Following procedures: We ensure every step, from giving written notice to consulting with trade unions if necessary, is done correctly.

Navigating visas and work permits in Ukraine can seem complex. The key is understanding the difference between a work permit, which allows you to be employed, and a visa, which allows you to enter and stay in the country. For most foreign nationals seeking to work in Ukraine, you will need both. The process typically starts with an employer in Ukraine sponsoring your work permit. Once the work permit is approved, you can then apply for a long-term (Type D) visa. This visa allows you to enter Ukraine and obtain a temporary residence permit.

Employment visas & sponsorship realities

An Employer of Record (EOR) can be a practical way to manage employment in Ukraine, especially if you don't have a local legal entity. An EOR can legally hire and sponsor foreign nationals for work permits. They handle the complexities of local labor laws, payroll, and compliance, acting as the legal employer for your team members in Ukraine.

Here are the practical routes for employment visas:

• Employer Sponsorship: The most common path is direct sponsorship by a Ukrainian employer. This employer must be a registered legal entity in the country and provide a valid job offer.
• EOR Sponsorship: Using an EOR simplifies the process. The EOR, as your partner, sponsors the work permit and manages all legal and HR obligations.

It is important to know that there can be limits on the number of visas available. An EOR can help you navigate these potential hurdles. They can also help you understand the specific requirements for different types of work visas, such as those for skilled workers or temporary projects.

Business travel compliance

For short-term business trips, you will likely need a C-type visa. This visa allows for stays of up to 90 days within a 180-day period. It is intended for activities like business meetings and negotiations. Keep in mind that some nationalities may not need a visa for short stays.

To ensure compliance, be prepared to provide the following documents when applying for a business visa:

• A valid passport with at least two blank pages.
• A completed visa application form.
• A business invitation letter from a registered Ukrainian company.
• Proof of sufficient funds to cover your stay.
• Health insurance.

When you arrive in Ukraine, border officials may ask to see your invitation letter, proof of accommodation, and a return ticket. Always carry copies of these documents with you. It is crucial that the purpose of your visit aligns with your visa type. A business visa does not permit you to carry out work that would require a work permit.