Kazakhstan

• Social Tax: Employers in Kazakhstan pay a 9.5% tax on employee gross salaries.
• Social Contributions: A 3.5% contribution is required from employers for Kazakhstani citizens, not applicable to expatriates without permanent residency.
• Obligatory Pension Contributions (OPC): Employers withhold 10% of the employee's gross salary for the pension fund.
• Obligatory Professional Pension Contributions (OPPC): An additional 5% is required for employees in harmful work conditions.
• Obligatory Medical Insurance Contributions: Employers contribute 3% and employees 2% of the gross salary for Kazakhstani citizens.
• Corporate Income Tax (CIT): The standard rate is 20%, calculated from taxable income.
• Other Taxes and Contributions: These include a 10% Individual Income Tax (IIT) withheld by employers, Property Tax, Land Tax, and Vehicle Tax.
• Payment Deadlines: Most payroll taxes and contributions are due monthly by the 25th; CIT is paid annually with potential advance payments for larger taxpayers.
• Standard and Additional Deductions: Various deductions are available such as for insurance premiums, medical expenses, and mortgage interest.
• Value-Added Tax (VAT): The standard rate is 12%, with exemptions for essential services and a zero rate for exports and certain transactions. Recent changes require foreign suppliers of electronic services to register for VAT.
• Investment Incentives: These include tax credits, exemptions in Special Economic Zones, and alternative tax options for specific industries.

• Paid Annual Leave: Employees in Kazakhstan are entitled to a minimum of 24 calendar days of paid vacation per year, excluding official holidays. This leave accrues throughout the year and can be carried over to the next year, but should generally be used within three years.

• Compensation for Unused Leave: Upon termination of employment, employees are compensated for any unused vacation time. The Labor Code prohibits substituting annual leave with monetary compensation except at termination.

• Extended Leave for Hazardous Work: Additional paid vacation days are granted to those working under hazardous or harmful conditions, with the amount depending on the specific work environment.

• National Holidays: Kazakhstan observes several national holidays, including New Year's Day, International Women's Day, Nauryz Meyramy, and Independence Day, among others.

• Religious Holidays: Major religious holidays include Orthodox Christmas and Qurban Ait (Eid al-Adha), with dates varying for Islamic holidays based on the lunar calendar.

• Other Types of Leave: The Labor Code also provides for sick leave with a medical certificate, unpaid social leave at the employer's discretion, and special leave for personal events like marriage or bereavement.

The Labor Code of the Republic of Kazakhstan governs these regulations, overseen by the Ministry of Labor and Social Protection of the Population.

In Kazakhstan, employers are required to provide a comprehensive benefits package that includes social insurance, paid time off, and additional health and wellness programs. The social insurance system covers pensions, disability, survivor pensions, and basic healthcare, with employers contributing 10% of an employee's gross salary to a mandatory pension fund. Employees enjoy a minimum of 24 days of paid annual leave, public holidays, and specific leaves for maternity and other life events.

Health benefits extend beyond basic coverage through employer-provided health insurance plans, which may include dental and vision care. Employers also contribute 3% of monthly salaries to Mandatory Social Health Insurance (MSHI), which covers various medical services. Employees can opt for private health insurance for more comprehensive coverage.

The pension system is multi-tiered, involving mandatory contributions to the Unified Accumulative Pension Fund and optional private pension plans. Employees can increase their retirement savings through voluntary contributions and employer-sponsored plans.

Work-life balance is supported by flexible work arrangements and potentially more generous PTO policies than the legal minimum. Overall, these benefits aim to enhance financial security and improve the well-being of employees in Kazakhstan.

In Kazakhstan, employment termination and workplace regulations are comprehensively outlined in the Labor Code of the Republic of Kazakhstan. The Code specifies valid reasons for employment termination, including mutual agreement, expiry of a fixed-term contract, employee initiative, and employer's bankruptcy or liquidation. Employer-initiated dismissals can occur due to reasons such as repeated failure to perform duties, gross violations, absenteeism, and theft, among others.

Employers must provide at least one month's written notice for termination, except when a fixed-term contract expires. Severance pay is mandated in cases like employer liquidation, staff reduction, and termination due to health reasons or refusal to relocate with the employer.

Discrimination in employment is prohibited on grounds of gender, race, and other characteristics, with the Constitution and Labor Code providing a framework against discrimination. Complaints can be addressed to State Labor Inspectorates, the prosecutor's office, or through civil courts.

The Labor Code also sets standards for working hours, rest periods, and ergonomic requirements, emphasizing a 40-hour workweek, with provisions for overtime and rest. Employers are obligated to ensure a safe work environment, conduct risk assessments, provide appropriate training and personal protective equipment, and report accidents.

Employee rights under the health and safety framework include the right to a safe workplace, access to safety training, and the right to refuse unsafe work. The Committee for Occupational Safety enforces these regulations through inspections and can issue fines for non-compliance. Additionally, Kazakhstan's Social Insurance Law supports employees with work-related injuries or illnesses financially and medically.

In Kazakhstan, the Labour Code governs various types of employment agreements, including indefinite term contracts, fixed-term contracts, and contracts for specific work or replacement. Indefinite term contracts, which do not have a set end date, are the most prevalent, providing significant job security. Fixed-term contracts are used for temporary roles or specific projects, with a duration typically between three months and one year, and can be renewed twice with each extension lasting at least one year. Contracts for specific work or replacement end when the task is completed or the replaced employee returns.

The Labour Code also mandates that employment agreements contain essential clauses such as identification of parties, job details, remuneration and benefits, work schedule, leave provisions, termination clauses, confidentiality, and intellectual property rights. Additionally, it outlines the rules for probationary periods, which can last up to three months for most positions and up to six months for higher-level roles, with a shortened period for short-term contracts.

The Code also addresses confidentiality and non-compete clauses. While confidentiality clauses are strongly enforced to protect sensitive information, non-compete clauses have limited legal weight and must be carefully tailored to be enforceable. Employers are advised to consult legal experts to ensure compliance with these provisions and to effectively manage employment relationships within the framework of Kazakhstani labor laws.

• Article 138 of the Labor Code of Kazakhstan (2015) defines remote work and allows both employers and employees to mutually agree to switch to remote work arrangements. It specifies that details like working hours, communication methods, and compensation should be outlined in a supplementary agreement to the employment contract.

• Draft Law and Developments: A draft law is in progress that would allow employees to request remote work arrangements, indicating a shift towards more employee-centric policies.

• Importance of Clear Contracts: Due to the lack of a comprehensive legal framework, it's crucial for remote work agreements in Kazakhstan to clearly define aspects such as the nature of work, working hours, and compensation.

• Technological Infrastructure: Effective remote work in Kazakhstan depends on reliable internet access and appropriate communication tools. The Labor Code does not specify employer obligations regarding the provision of equipment.

• Employer Considerations: Employers should focus on data security, provide necessary equipment or stipends, and consider developing a formal remote work policy to outline various operational and security aspects of remote work.

• Employer Responsibilities: These include training employees, managing performance, and fostering a positive work culture to ensure productivity and engagement in remote settings.

• Additional Considerations: Employers should be aware of potential challenges related to work-life balance and mental health in remote work scenarios.

• Flexitime and Job Sharing: The Labor Code outlines standard working hours but allows some flexibility with employer approval. Job sharing isn't explicitly addressed but can be arranged through contracts.

• Data Protection: Employers must protect employee data by implementing technical and organizational measures and being transparent about data usage. Employees have rights regarding their personal data and responsibilities to adhere to security protocols.

Overall, while Kazakhstan's legal framework for remote work is evolving, both employers and employees must navigate current regulations carefully, ensuring clear contracts and robust data protection measures are in place.

• Standard Workweek: In Kazakhstan, the standard workweek is capped at 40 hours, distributed over five days (Monday to Friday), with each day having a maximum of eight working hours.

• Exceptions for Specific Groups:

  • Employees aged 14-16: Maximum of 24 hours per week.
  • Employees aged 16-18 and those in hazardous or physically demanding jobs: Maximum of 36 hours per week.

• Overtime Regulations:

  • Overtime is defined as work beyond standard hours, limited to two hours daily, or one hour for strenuous jobs.
  • Overtime pay must be at least 1.5 times the regular rate, with potential for higher rates under specific contracts.

• Exemptions from Overtime:

  • Pregnant women, employees under 18, and disabled employees (unless medically cleared) are exempt from mandatory overtime.

• Rest Periods and Breaks:

  • Daily breaks of at least 30 minutes for shifts under eight hours, and one hour for longer shifts.
  • A minimum of 12 hours rest between workdays.
  • Two consecutive rest days per week, typically including Sunday.

• Night and Weekend Work:

  • Night work (10 pm to 6 am) pays at least 1.5 times the regular rate.
  • Weekend work pays double the regular rate, with options for compensatory rest.
  • Written consent is required for scheduling weekend work, except in emergencies.

• Record Keeping and Legal Compliance:

  • Employers must maintain accurate records of overtime and ensure compliance with compensation laws as per the Labour Code.

Understanding competitive salaries in Kazakhstan is essential for attracting and retaining talent. Factors influencing salary competitiveness include job title, industry, experience, skills, education, location, and company size. The minimum wage is set annually and is a base salary excluding additional benefits. Employers must ensure wages meet or exceed this minimum and provide detailed payslips.

Statutory benefits mandated by law include paid time off, social security contributions, various types of leave, and overtime pay. Additionally, many companies offer discretionary bonuses and allowances such as performance-based bonuses, housing, transportation, and education allowances to enhance compensation packages.

Salaries are paid monthly, and while there's no requirement for a 13th-month bonus, some companies choose to offer it. Employers are responsible for withholding income tax and social contributions, ensuring compliance with Kazakhstan's labor regulations.

In Kazakhstan, the Labour Code regulates notice periods for employment termination, which vary based on who initiates the termination and the reasons behind it.

Employer-Initiated Termination:

• Employers must generally provide at least one month's written notice.
• Exceptions include shorter notice periods if agreed upon, or no notice for specific contract-stipulated reasons.
• For large-scale downsizing or company liquidation, employers must also notify the labor authority one month in advance.

Employee-Initiated Termination:

• Employees can terminate their employment at any time with written notice, typically without a legally mandated notice period, unless specified otherwise in a contract or collective agreement.

Termination by Mutual Agreement:

• No set notice period; terms are agreed upon by both parties.

Severance Pay:

• One month's average salary for company liquidation or staff reduction.
• Two months' average salary for redundancy due to economic difficulties.
• One month's average salary if the employer breaches the contract.

Additional Considerations:

• Collective bargaining agreements may provide greater severance benefits.
• Individual contracts can specify terms, including severance pay and conditions for termination without notice.

It's crucial to consult specific employment contracts, collective agreements, and labor laws for precise information on termination procedures and entitlements.

In Kazakhstan, the distinction between employees and independent contractors significantly impacts employment rights, social security contributions, and tax obligations. Employees operate under employer control with set schedules and tasks, while independent contractors maintain autonomy, setting their own schedules and methods. Misclassification of workers can lead to legal consequences and financial penalties for employers.

Independent contractors can choose from several contract structures, such as Civil Law Contracts or registering as Individual Entrepreneurs, each with specific legal and tax implications. Effective negotiation of contract terms, including payment and scope of work, is crucial, and understanding cultural business practices can enhance these negotiations.

Various industries in Kazakhstan, including IT, creative sectors, marketing, and legal services, utilize independent contractors. These contractors must manage their own tax and social security contributions, with options for additional insurance coverage for greater protection.

Intellectual property rights are particularly important for freelancers, who by default retain ownership of their creations under Kazakh law, unless otherwise transferred through a contract. Freelancers are advised to take measures to protect their IP and should consider consulting with legal professionals to navigate these aspects effectively.

Kazakhstan's health and safety regulations emphasize workplace safety, mandating employer and employee responsibilities and government enforcement. The Labor Code and other specific laws provide a framework for hazard prevention, employee rights, and employer obligations, including regular risk assessments and safety training. The Ministry of Healthcare and Social Development, through the Labor Inspectorate, oversees compliance, conducting inspections and imposing penalties for non-compliance. Challenges include enforcement in smaller enterprises and ensuring comprehensive understanding of safety regulations among all employees. Continuous updates to laws and standards, including international standards like ST RK ISO 45001-2018, aim to enhance workplace safety across various sectors.

Kazakhstan's labor dispute resolution system includes labor courts and arbitration panels. Labor courts handle individual and collective disputes related to employment, operating under civil procedure principles with adaptations for labor issues. Arbitration panels offer a voluntary alternative, with Conciliation Commissions and Labor Arbitration Courts providing industry-specific expertise.

The Labor Code and the Law "On Mediation" govern these mechanisms, emphasizing compliance through audits and inspections conducted by the State Labor Inspectorate and other authorized bodies. These inspections, which can be triggered by worker complaints or scheduled plans, aim to ensure adherence to labor laws and fair practices.

Non-compliance can lead to warnings, fines, or more severe penalties like operation suspension or criminal charges. Whistleblower protections are in place to safeguard individuals reporting violations, although practical challenges like fear of retaliation and lack of awareness persist.

Kazakhstan has ratified several ILO conventions influencing its labor laws, including those against forced labor, discrimination, and child labor. However, gaps in enforcement and restrictions on trade union activities suggest areas for improvement in aligning with international labor standards.

Understanding communication styles is crucial in Kazakh workplaces, which are shaped by nomadic traditions and Soviet influences. Here’s a breakdown of key aspects:

• Directness with Nuance: While Kazakhs value straightforward communication, they often employ indirect methods for feedback to maintain harmony and avoid confrontation. Trust is essential, and being too direct without established rapport can be seen as rude.

• Formality by Hierarchy: Communication style varies with hierarchy; formal in meetings and with superiors, and less formal with peers over time. Soviet legacies of formality and respect for authority persist.

• Non-Verbal Communication: Non-verbal cues like eye contact, nodding, and maintaining personal space play a significant role in conveying respect and attentiveness.

• Pragmatism and Long-Term Relationships: Kazakh negotiators focus on pragmatic, mutually beneficial solutions and value long-term relationships, reflecting the cultural emphasis on familial ties and group obligations.

• Strategies for Success: Building personal relationships and understanding non-verbal cues are crucial. Patience and allowing for silence during negotiations are recommended.

• Hierarchical Structures: Kazakh businesses typically have vertical hierarchies, with decision-making concentrated at the top. While this can expedite decisions, it may also limit creativity and employee engagement.

• Leadership Styles: Leaders are expected to be paternalistic yet inspiring, guiding teams towards achieving their potential while maintaining clear authority.

• Statutory and Regional Holidays: Understanding national and local holidays is important for business operations, as these can significantly affect work schedules and productivity.

Overall, success in Kazakh business environments requires an understanding of nuanced communication, respect for hierarchical structures, and cultural sensitivity towards local traditions and holidays.