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Employment in Kazakhstan

In Kazakhstan, labor relations are regulated by the regulatory legal instruments, individual contract of employment and, if one exists, a collective labor agreement. The labor laws and regulations of the Republic of Kazakhstan are based on the Constitution of the Republic of Kazakhstan and include the Labor Law and other legal instruments, which regulate labor relations of some separate categories of the employees. The major sources of labor legislation are laws adopted by the Parliament, and technical acts, passed by the governmental agencies.

According to Article 3 of the Labor Law of Kazakhstan, the labor law regulations in Kazakhstan are applicable to all workers who have entered into employment relations with employers.

The most important source of Labor Law is the Code of the Republic of Kazakhstan of 15 May 2007 No. 251 “Kazakhstan Pravda” of 22 May 2007 No. 76 (25321).

There are also a number of other legal acts, which regulate the labor and industrial relations, not covered by the Labor Law, such as:

  • The Law on Collective Labor Disputes and Strikes (July 8, 1996);
  • The Law on Collective Agreements (July 4, 1992);
  • The Law on the Occupation of the Population (1998);
  • The Edict on Approving a Position on Qualification Classes of State Employees
    (July 12, 1996);
  • The Law on Employment of Population (January 23, 2001);
  • The Law on State Service (July 23, 1999).

Key points on employment in Kazakhstan

There are several key areas to be aware of within the Kazakhstan employment regulatory framework, especially for companies that plan to initiate a full local office and human resources department.  These challenges can be mitigated by use of a locally sourced payroll provider who is familiar with all of the local laws and rules for both local employees as well as foreign nationals.

  1. Contracts

    Labor relations, as well as other relations directly connected with labor, shall be regulated by the employment contract, act of the employer, agreement and collective bargaining agreement.

    The provisions of agreements between the parties to a social partnership, collective bargaining agreements, employment contracts and acts of employers that are detrimental to the employees’ status compared with the labor legislation of the Republic of Kazakhstan shall recognised as null and void.

    The terms and conditions of agreements, collective bargaining agreements and employment contracts may not be amended unilaterally.

    The employment contract shall contain:

    1) the details of the parties:

    full name, including patronymic (if indicated in the identity document) of an individual employer, his permanent residential address, the name, number and date of issue of his identity document, and taxpayer’s registration number;

    full name of a legal entity employer and its location, the number and date of state registration of the legal entity employer, and taxpayer’s registration number;

    full name, including patronymic (if indicated in the identity document) of the employee, name, number, and date of identity document; individual identification number, taxpayer registration number, individual social code;

    2) the job according to a certain specialty, qualifications or position (labor function);

    3) place of job performance;

    4) term of the employment contract;

    5) job starting date;

    6) working time and rest time regime;

    7) amount and other conditions of labor compensation;

    8) description of the working conditions, guarantees and benefits, if the job involves heavy work and (or) is performed under harmful (particularly harmful) and (or) hazardous conditions;

    9) rights and obligations of the employee;

    10) rights and obligations of the employer;

    11) procedure for amending or terminating the employment contract;

    12) guarantees and compensation payments, the procedure for their payment.

  2. Termination Procedures

    An employment contract concluded for a specific period shall be terminated in connection with expiry of its term of validity. The date of expiry of an employment contract concluded for a specific period shall be the final day on which the employee performs his job in accordance with the term stipulated by the employment contract.

    The date of expiry of an employment contract concluded for the period of performance of specific work shall be the day on which the work is completed.

    The date of expiry of an employment contract concluded for a period of replacement of a temporarily absent employee shall be the day on which the employee whose job (position) has been maintained returns to work.

    If, on expiry of the employment contract, the labor relations in fact continue and neither of the parties demands their termination, the contract shall be deemed to have been prolonged for an indefinite period.

    An employment contract with an employee may be cancelled on the initiative of the employer in the following cases:

    1) liquidation of a legal entity employer or termination of the activities of an individual employer;

    2) reduction in staff numbers or positions;

    3) unfitness of the employee for the position held or work performed as a consequence of inadequate qualifications;

    4) unfitness of the employee for the position held or work performed as a consequence of health reasons hampering continued performance of the given work;

    5) a negative result of work performed during a probationary period;

    6) absence of the employee from work without good reason for a period of three or more hours in a row during a single working day (work shift);

    7) presence of the employee at work under the influence of alcohol, narcotics or toxic substances (or their analogues), including in cases of consumption during the working day of intoxicating substances (or their analogues);

    8) violation by the employee of the rules for labor safety or fire safety or traffic safety entailing or capable of entailing serious consequences, including injuries and accidents;

    9) theft (including minor theft) by the employee in the work place of other people’s property, its deliberate destruction or damage, as established by a sentence or court ruling that has come into legal effect;

    10) culpable actions or inaction on the part of an employee dealing with money or goods if these actions or inaction provide grounds for the employer to lose his trust in him;

    11) an immoral act carried out by an employee fulfilling educational functions that is incompatible with continued performance of the given work;

    12) divulgence by the employee of information constituting state secrets or other secrets protected by law that he acquired in connection with performance of his job duties;

    13) repeat failure by the employee to fulfil or duly fulfil his job duties, without good reason, provided a disciplinary sanction has been imposed thereon;

    14) termination of the employee’s access to state secrets in cases established by the laws of the Republic of Kazakhstan;

    15) knowing provision by the employee to the employer of false documents or information on conclusion of the employment contract, if the genuine documents or information might constitute grounds for refusal to conclude the employment contract;

    16) violation by the head of the employer’s executive body, his deputy or heads of subdivisions of the employer of their job duties resulting in material damage to the employer;

    17) absence of the employee from work for over two months in a row as a consequence of temporary disability, with the exception of cases when the employee is on maternity leave or if the relevant disease is included on the list of illnesses for which a longer term of disability is established, approved by the Government of the Republic of Kazakhstan.

    For an employee disabled in connection with an industrial accident or occupational disease, his job (position) is retained until his working capacity is restored or disability established;

    18) a corruption-related crime committed by the employee and excluding, in accordance with a judicial act, the possibility of his continued work.

    Procedure of cancellation 

    1. The employer shall serve at least one month’s written notice on the employee of cancellation of the employment contract, unless the employment contract or collective bargaining agreement envisaged a longer notice period. With the written consent of the employee, the employment contract may be cancelled before expiry of the notice period.
    2. Cancellation of employment contracts with employees who are members of a trades union shall be carried out in consideration of the reasoned opinion of the trades union of the given organization in the manner envisaged by the collective bargaining agreement.
    3. Cancellation of an employment contract unfitness of the employee for the position held or work fulfilled for health reasons hampering continuation of the given work shall be confirmed by a medical and social examination opinion in the manner established by the legislation of the Republic of Kazakhstan.
    4. The cancellation shall be carried out in observance of the procedure for imposition of disciplinary sanctions, as envisaged by article 73, and of the requirements of article 74 of this Code.
    5. Cancellation of the employment contract on the initiative of the employer owing to unfitness of the employee for the position held or work performed as a consequence of inadequate qualifications shall be based on a decision of an appraisal commission including an employees’ representative, unless otherwise established by the laws of the Republic of Kazakhstan.

    The procedure and conditions for and frequency of employee appraisals shall be determined by the collective bargaining agreement and, in its absence, by an act of the employer.

    The employee shall have the right to cancel the employment contract on his own initiative by giving the employer at least one month’s written notice to this effect.

    On agreement between the employee and the employer, the employment contract may be cancelled before expiry of the notice period.

    The employee shall serve written notice on the employer of cancellation of the employment contract at the time indicated in the application in cases when the employment contract is cancelled owing to impossibility of continuing work.

    The employee shall have the right to notify the employer in writing of non-performance by the employer of the terms and conditions of the employment contract. In the event that, on expiry of a period of seven days, non-performance by the employer of the terms and conditions of the employment contract continues, the employee shall have the right to cancel the employment contract by serving at least three working days’ written notice on the employer.

    During the notice period envisaged by this article, the employee shall have the right to revoke, in writing, its application for cancellation of the employment contract.

    On expiry of the notice period indicated in this article, the employee shall have the right to cease work, while the employer shall issue to the employee the documents associated with his labor activities and any payments due thereto.

    For individual categories of employees, this Code envisages a special procedure for cancelling the employment contract on the initiative of the employee.

  3. Working hours

    Normal duration working time shall not exceed 40 hours a week.

    Employment contracts and collective bargaining agreements may envisage a shorter duration working time with payment as for normal duration working time.

  4. Statutory Leave

    Employees shall be granted the following types of leave:

    1) annual paid leave;

    2) social leave.

    Paid annual leave is intended for the employee to rest, restore his working capacity, strengthen his health and fulfil other personal requirements and is granted for a specific number of calendar days with retention of the employee’s job (position) and average wage.

    Social leave is understood as release of the employee from work for a specific period of time for the purpose of creating favorable conditions for maternity, childcare, education while working and for other social purposes.

    Employees are granted the following types of social leave:

    • unpaid leave;

    3) maternity leave and leave for adoption of a newborn (or newborns).

    Employees shall be granted annual paid leave of twenty-four calendar days, unless a greater number of days in envisaged by other regulatory and legal acts, the employment contract, collective bargaining agreement or acts of the employer.

    Additional annual paid leave shall be granted:

    • to employees engaged in heavy work, work under harmful (particularly harmful) and (or) hazardous working conditions, the duration of which shall be at least six calendar days;
    • group one and two disabled, with a duration of at least fifteen calendar days.

    For other categories of employees, provision of additional annual paid leave and its minimum duration may be established by the laws of the Republic of Kazakhstan.

    Employment contracts and collective bargaining agreements may establish, for employees, additional annual paid leave of an incentive nature for long, continuous work service, performance of important, complex and urgent work, as well as work of another nature.

    The duration of annual paid leave shall be calculated in calendar days, not counting official holidays falling during the leave period, irrespective of the work regime and timetable.

    In calculating the total duration of annual paid leave, additional annual paid leave shall be added to the basic annual paid leave. The total duration of annual paid leave shall not, moreover, be restricted by any maximum limit.

    On agreement between the parties to the employment contract and on the basis of an application from the employee, he may be granted unpaid leave.

    The duration of the unpaid leave shall be determined by agreement between the employee and the employer.

    On the basis of a written application from the employee, the employer shall provide unpaid leave of up to five calendar days for:

    1) registration of marriage;

    2) birth of a child;

    3) death of a close relative;

    4) in other cases envisaged by the employment contract or collective bargaining agreement.

    Pregnant women, women who have given birth, women (men) who have adopted a newborn (or newborns) shall be granted the following types of maternity leave:

    1) ante-natal and post-natal leave;

    2) paid leave to employees adopting a newborn (or newborns);

    3) unpaid childcare leave until the child reaches the age of three years.

    Maternity leave and leave for adoption of a newborn (or newborns) shall be granted on the conditions envisaged by articles 192 – 195 of the Kazakhstan Pravda.

    The procedure for calculating the average wage for payment of maternity leave and leave for adoption of a newborn (or newborns) shall be determined in accordance with article 136 of the Kazakhstan Pravda.

Outsourcing Employment Through a GEO Employer of Record Service

Compliance with local employment requirements is just one of the issues foreign companies face when employing staff in Kazakhstan. For companies, which intend to employ their staff directly through their incorporated Kazakhstan entity, professional legal advice is recommended. Shield GEO provides an alternative path for companies to outsource the employment of their staff in Kazakhstan.

As a Global Employer Organization (GEO), Shield GEO acts as the Employer of Record and ensures the employment is compliant with host country regulations regarding employment. In addition Shield GEO will handle payroll processing, tax and immigration. Using Shield GEO is the fastest and most cost effective way to deploy local and foreign workers into Kazakhstan.

The Shield GEO solution is an attractive alternative where

– the company is looking to employ staff quickly

– the company doesn’t have an appropriately incorporated entity in Kazakhstan

– the company wants to work within a defined budget

– the company wants to limit its initial commitment in Kazakhstan

– the company needs help with tax, employment, immigration and payroll compliance in Kazakhstan

Shield GEO can contract directly with the company to employ and payroll their staff in Kazakhstan. Shield GEO supplies local employment contracts for the staff which ensure that local statutory requirements are met covering issues such as termination, probation periods, leave entitlements and statutory benefits.  Shield GEO is able to advise companies how to cover local employment regulations whilst still providing consistent global employment policies. Understand more about outsourced employment through Shield GEO.

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