1.
Informa(on
Brochure
©
HWC,
Kyiv,
2015
Payroll
and
Labor
Condi(ons
Outsourcing
Services

2.
2OS Competence Paper Acc&Tax.pptx
SPECIFICS
OF
THE
UKRAINIAN
MARKET
Making
business
in
Ukraine
is
embedded
into
a
quite
unique
market
situa(on.
On
the
one
hand
the
country
is
associa(ng
itself
towards
the
European
Union
by
ini(alizing
reforms
and
rejuvena(ng
its
authori(es.
This
atmosphere
of
change
promises
massive
chances
to
capture
a
remunera(ve
market.
On
the
other
hand
the
country
conducts
its
heritage
of
the
former
Soviet
Union
including
laws
and
regula(ons,
specific
local
accoun(ng
standards,
a
variety
of
different
authori(es
directly
impac(ng
the
business
world
by
a
high
level
of
bureaucracy
and
corrup(on.
Excellent
personal
rela(onships
and
the
crea(on
of
trust
are
essen(al
to
establish
a
successful
joint
venture
or
market
presence.
HWC
is
combining
local
exper(se
with
Western
European
business
manner
and
acts
as
the
interface
between
you
and
this
complex
environment.
Adap(ng
your
business
to
the
Ukrainian
market,
consul(ng
on
business
relevant
decisions
and
suppor(ng
with
business
services
is
our
core
competence.
Making
your
business
work
–
is
what
we
do!

3.
3OS Competence Paper Acc&Tax.pptx
§ The
monthly
salary
in
Ukraine
is
limited
on
the
lower
side
by
the
Ukrainian
government.
As
of
1
September
2015
the
minimum
salary
is
UAH
1,378
per
month
(approx.
EUR
55).
It
has
to
be
paid
in
two
tranches
(advance
and
balance).
The
period
between
the
tranches
can
not
be
less
than
16
calendar
days.
The
balance
payment
can
not
be
carried
out
later
the
7th
calendar
day
following
the
paid
month.
§ Unified
Social
Security
Contribu=on
(USSC)
§ In
general,
the
mandatory
remi^ances
to
the
Pension,
Unemployment,
Social
Security
and
Accident
Insurance
Funds
are
covered
by
the
USSC,
which
is
to
be
accrued
by
an
employer
based
on
the
gross
salary
of
an
employee.
§ Nevertheless,
currently
the
gross
salary
for
the
USSC
purpose
is
capped
at
the
level
of
17
(seventeen)
sustenance
minimums
per
month.
For
the
period
September
–
December
2015
the
cap
is
UAH
23,426
(approx.
EUR
940).
The
cap
is
applied
for
the
employer’s
and
the
employee’s
liabili(es.
The
salary
amounts
exceeding
the
cap
are
not
subject
to
the
USSC.
§ The
USSC’s
rates
are:
-­‐
employee:
3,60%
(payroll),
2,4%
(civil
law
agreements);
-­‐
employer:
36,76%
-­‐
49,7%
depending
on
the
level
of
the
industrial
risk
set
by
the
Ukrainian
government
§ Personal
Income
Tax
(PIT)
§ The
USSC
cap
is
not
applicable
for
the
PIT
calcula(ons.
Generally,
the
gross
salary
minus
the
USSC
is
subject
to
the
PIT;
§ The
PIT
rates
are:
-­‐
15
%
applies
to
the
up
to
10
(mes
the
minimum
salary,
i.e.
UAH
13,780
(approx.
EUR
550)
for
the
period
September
–
December
2015
-­‐
20%
applies
to
the
amounts
that
are
paid
on
top
of
10
(mes
the
minimum
salary
§ Military
Tax
§ The
gross
salary
is
subject
to
the
Military
Tax
§ The
Military
Tax
rate
is
1,5%
§ The
Military
Tax
is
the
sole
responsibility
of
an
employee
Payroll

4.
4OS Competence Paper Acc&Tax.pptx
LABOR
CONDITIONS
The
main
condi(ons
of
employment
in
Ukraine
are
governed
by
the
Labor
Code
of
Ukraine
(further
-­‐
the
‘Labor
Code’).
The
Labor
Code
envisages
the
main
obliga(ons
and
rights
of
employers
and
employees.
The
Ukrainian
labor
legisla(on
is
inherited
from
the
Soviet
(mes
and
therefore
the
emphasis
is
made
on
protec(ng
the
rights
of
the
employees
rather
than
of
the
employers.
The
main
requirements
under
the
Labor
Code
are:
§ The
length
of
a
working
week
is
not
to
exceed
40
hours.
Over(me
work
and
work
during
holidays
are
generally
prohibited
by
the
Labor
Code
of
Ukraine.
Nevertheless,
the
Labor
Code
provides
with
the
exhaus(ve
list
of
the
specific
cases
when
the
over(me
work
and
work
during
holidays
are
permissible;
§ Working
during
holidays
is
reimbursed
by
mutual
consent
either
by
giving
another
day-­‐off
or
by
providing
double
monetary
compensa(on.
Over(me
work
during
ordinary
working
days
can
not
be
compensated
by
providing
with
the
day-­‐off
compensa(on
but
requires
the
double
monetary
compensa(on;
§ An
employee’s
minimum
annual
vaca(on
en(tlement
is
24
calendar
days;
§ The
Ukrainian
labor
legisla(on
provides
for
certain
social
benefits:
maternity
leave,
paid
holidays
and
vaca(on
(me,
paid
sick
leave,
and
some
others;
§ The
no(ce
period
in
case
of
termina(on
of
the
employment
agreement
by
the
employee
is
at
least
two
weeks.
The
statutory
termina(on
no(ce
for
the
dismissal
of
an
employee
upon
the
employer’s
ini(a(ve
(the
main
grounds
for
this
are
the
staff
redundancy
or
reorganiza(on
of
the
company’s
structure)
is
two
months;
§ In
cases
of
severe
misconduct
at
work
(e.g.,
thej,
alcohol
or
drug
intoxica(on,
etc.),
the
employee
may
be
dismissed
immediately.
Nevertheless,
the
termina(on
is
normally
subject
to
unfavorable
judicial
interpreta(on
for
an
employer
and,
correspondingly,
requires
huge
paperwork
to
protect
the
employer
against
further
claims
from
the
dismissed
employee;
§ An
employer
should
provide
an
employee
with
per
diems
advance
for
each
day
of
business
trip
(including
day
of
departure
and
arrive).
The
amounts
of
the
per
diems
are
limited
by
the
Ukrainian
government
and
are
different
for
the
business
trips
within
the
borders
of
Ukraine
and
for
the
business
trips
abroad.

5.
5OS Competence Paper Acc&Tax.pptx
§ HWC
is
able
to
provide
its
clients
with
the
comprehensive
payroll
administra(on.
For
this
purpose
HWC
has
highly
qualified
professionals
and
special
accoun(ng
sojware.
§ HWC
is
able
to
provide
its
clients
with
the
salary
computa(ons
in
accordance
with
the
client’s
policy,
namely:
§ “Gross
to
net”
salary
approach
§ “Net
to
gross”
salary
approach
§ Foreign
currency
equivalent
approach
§ Foreign
currency
approach
§ Other
specific
approaches
(if
any)
§ Except
the
direct
salary
computa(on
the
HWC’s
payroll
service
includes:
§ Payroll
related
repor(ng
to
the
tax
and
other
fiscal
authori(es
§ Handling
of
the
queries
of
a
client
and/or
its
employee(s)
§ Mee(ngs
with
a
client
and/or
its
employee(s)
§ Assistance
in
hiring
and
termina(on
of
employee(s)
§ Prepara(on
of
a
labour
contract(s)
§ Prepara(on
of
a
job
descrip(on(s)
§ Prepara(on
of
a
standard
handbook,
etc.
§ When
payroll
services
provided
by
HWC,
we
ensure:
§ Strict
confiden(ality
§ Individual
approach
§ Effec(ve
and
efficient
communica(ons
§ Reasonable
fees
and
costs
PAYROLL
SERVICE

6.
Making
your
business
work
–
is
what
we
do!
HWC
LLC
Ukraine
Kyiv
04205
Obolon
Residences
Obolonskyi
Ave
26
+380
44
451-­‐5154
office@hwc.com.ua
www.hwc.com.ua