Analytics

There is new procedure for issuance of job permits for foreigners: respective resolution No. 437 was adopted by Cabinet of Ministers of Ukraine 27 May 2013 and came into force 05 July 2013. The press-service of Ministry of Social Policy of Ukraine spread the information that the procedure on obtaining of job permit was eased; however after analysing requirements under the new regulation, we are not so optimistic.

Officers of the Ministry report that number of documents required for issuance of job permit is reduced from 15 to 8. At first view – a good result, but real figures (if compare the current procedure with the previous one) are much closer. First, not form 15, but from 14 – according to the previous procedure starting from April 2013 the employer was not obliged to submit extract or excerpt from the State register of legal entities and individuals-entrepreneurs. Second – not to 8, but to 11 (in best-case scenario). It is unlikely, that employment centre will not require document certifying authority of the representative (usually it’s a power of attorney), unless, of course, the director of the company-employer submits documents personally.  Receipt of state fee payment for consideration of application is still required, though now it should be provided only after consideration and positive decision on providing of job permit. The same for the labour agreement (contract) with foreigner: instead of the draft labour agreement, the employer is obliged to submit copy of signed and valid labour contract during 3 days after obtaining of the job permit, otherwise the issued job permit is cancelled.

One of the documents, which is not required any more, is application explaining the need of the employer in engagement of the employee. From now, exhaustive list of the “well-motivated” reasons (which increase chances of positive decision) is legally formalized. Particularly, the new regulation defines that using of the foreigner’s labour is reasonable and grounded in case the foreigner applies for an executive position and he/she is a founder or co-founder of the Ukrainian company-employer. We would like to point out that foreigner co-founders are appointed as directors in the branch companies rarely if ever. As usual, the shareholders (Board of Directors) of foreign mother company want to appoint their representatives at managing positions in the Ukrainian subsidiaries. Such representatives are not founders/co-founders of the company; they are experts in the business field of the holding group or professional managers. They are in the confidence of the shareholders (Board of Directors) and often have 20-30 year experience in working for the foreign holding group. For foreign investors is crucial, especially while starting business in Ukraine, to have trusted management in the local office. However, the new procedure provides no means for easier employment of such staff.

The other documents, which are not required according to the new regulation, are: copy of the Charter (except in the mentioned case, when foreign founder applies for an executive position), the reference on due payment of taxes and duties from state tax authorities, and the reference on due payment of social security contributions from employment authorities (it seems that the employment centre finally discovered how to check information from their own data-bases without obtaining special reference).

After coming into force of the new regulation, the employer is obliged to provide a new document, which was not requested before, namely: reference from the health care centre that the employee is not suffering from chronic alcoholism, substance abuse, drug addiction or other infectious diseases, the list of which is approved by the Ministry of Health. Besides the wording of this rule is very poor (it turned out that alcoholism and drug addiction are infectious diseases), we would like to pay attention that there is no adequate legal grounds for submitting such reference by the foreign employee.

For comparison, similar reference is required to obtain an immigration permit. According to the Law of Ukraine “On Immigration” certain diseases are considered to be obstruction for issuance of an immigration permit for a foreigner. The list of such diseases is envisaged by the order of the Ministry of Health of Ukraine. Some categories of foreigners (including highly qualified experts and employees who are urgently needed for the economy of Ukraine) are not required to present such reference for obtaining of an immigration permit.

The other situation is in case with job permit:

• as of today there is no list of diseases, which prevent from obtaining the job permit, approved by the Ministry of Health; it’s even beyond the competence of the ministry (see para. 6.19 of the Regulations on the Ministry of Health of Ukraine, approved by the order of the President of Ukraine as of 13 April 2013, No. 467/2011);
• there is no legislation prescribing that some diseases may prevent form obtaining the job permit; the new regulation does not envisage that the employment centre may decline the application on this ground;
• the reference is obligatory for all categories of foreign employees (including highly qualified experts applying for executive positions), the only exception are persons, who may obtain the status of refugee or requiring special protection.

We would like to believe that all these issues will be resolved soon.

According to the information released by the Ministry of Social Policy of Ukraine, term for consideration of documents by the employment centre was shortened from 30 to 15 days. These figures are unrepresentative. Term for consideration of documents by the employment centre was really shortened. But if consider all steps, envisaged under the new regulation, starting from submission of the application and to obtainment of the job permit, actual time for receiving job permit is longer and require more interaction from the employer’s side, than it was before (which can hardly be called a simplified procedure).

We may conclude that the new regulation for obtaining job permits for foreigners, approved by the Cabinet of Ministers of Ukraine as of 27 May 2013, No. 437, will not result in any significant ‘easing’, on the contrary, at many steps it will increase bureaucracy in the process of employment of foreigners in Ukraine.

The above commentary presents the general statement for information purposes only and as such may not be practically used in specific cases without professional advice.

Kind regards,

© TOV "KM Partners", 2013

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