Russia

Russia PEO & Employer of Record

WeHG provides an International PEO and global Employer of Record service in Russia to companies wishing to enter the Russian market or hire local/expat employees in this country.

Traditional approach demand establishing a subsidiary in Russia.  However our solution allows you to start the operations in Russia within days hence save time and money.  WeHG would hire candidates on your behalf while you maintain full operational control of their work. So legally they would be our employees, on our local payroll, 100% compliant but will work on your behalf.

Russia fast facts

Population, million: 145,934,462
Land area: 17,098,246 km²
Capital: Moscow
Local currency: Russian Ruble (RUB)

GDP per capita:$ 10500.00
GDP in currency:$ 1250.00 billion

The main sources of employment law are:

  1. Constitution;
  2. Labour Code;
  3. Federal Law on Trade Unions, their Rights and Guarantees of their Activity;
  4. Federal Law on Employment of the Population of the Russian Federation;
  5. Federal Law on Legal Status of Foreign Citizens in the Russian Federation; 
  6. Federal Law on Amendment of Certain Legal Acts of the Russian Federation.

Employment & Labor Laws in Russia

Necessity of written employment contract

Contracts should be in writing form and include all necessary information about employment.

Different forms of engagement: employment, contracting, work with private entrepreneur

The rules concerning local workers also apply to foreign workers, but there are restrictions on the recruitment of foreign workers to work in Russia, which is regulated by the Federal Law on the Legal Status of Foreign Citizens in the Russian Federation. Foreign workers can work in Russia under a labor or civil law contract with a work permit.

Russia Employment Contract

Types of employment agreements

A complete, incomplete, temporary or permanent contract must be in writing form with two copies.

Russia working hours

40-hour working week.

Overtime

Overtime work is paid for the first 2 hours 1.5 times the regular hourly wage and 2 times more for all subsequent hours.

Employees’ eligibility for overtime pay cannot be canceled by contract.

Vacation leave in Russia

Worker is authorized to 28 days of paid leave after 6 months of work.

Worker is authorized to 3 days of paid sick leave.

Starting from the 4th day of sick leave, the payment is credited to the State Social Insurance Fund.

Russia Maternity Leave

Female workers are entitled to 70 days of maternity leave before and after childbirth. 84 days of maternity leave for mothers with 2 or more children. The female workers receive their full salary at the time of the decree from the State Social Insurance Fund.

Russian Severance Laws

An employer can fire a worker in the manner required by law.

Notice period

3 days – upon separation of a seasonal or probationary employee
1 month – upon separation of the head of the company
2 weeks – for all other cases

Systematic non-fulfillment of work, layoffs and other significant reasons can be the reason for the dismissal of an employee.

Russia Tax

Taxable income includes salaries and bonuses provided by an employer to its workers. The employer withholds 13 percent personal income tax from almost every worker payment (there are certain exceptions).

Any payments that are made to Russian employees are expose to social contributions that must be paid by the employer. The main rates and thresholds are:

•  pension fund: 22 per cent, or 10 per cent for any amount exceeding a certain threshold that is reviewed annually;
•  social security fund and medical insurance fund: 2.9 per cent and 5.1 per cent, respectively.

The employer is also required to make contributions to the social insuance fund in accordance with the law on mandatory social insurance for industrial accidents and occupational diseases. The amount to be paid as contributions depends on the types of operations the employer is engaged in and the risks involved. The contribution rate starts from 0.2 per cent.

Health Insurance Benefits in Russia

Medical expertise as a condition of employment is necessary only in certain  conditions described in the labor code and other federal laws.

In Russia, all citizens have a right to free medical services.

Additional Benefits in Russia

Supplementary health insurance may be provided by an employer to employees as a supplementary benefit in Russia.

General market practice benefits/additional allowances

The rules concerning local workers also apply to foreign workers, but there are restrictions on the recruitment of foreign workers to work in Russia, which is regulated by the Federal Law on the Legal Status of Foreign Citizens in the Russian Federation.

Russia Holidays

An employee is entitled to paid annual vacation of at least 28 calendar days once he or she hasworked with the same employer for six consecutive months (but certain exceptions apply).

Public holidays:

  • New Year’s Day.
  • Orthodox Christmas.
  • Defenders of the country Day.
  • International Women’s Day.
  • Labor Day holiday.
  • Victory Day.
  • National Day (Russian independence).
  • Unity Day.

Why Choose WeHireGlobally

WeHG takes care of all the onboarding hurdles, payroll, compensation and benefits, tax filing, and termination of employment. Our Employer of Record solution allows you to manage your overseas teams efficiently while minimizing cost and risk.

FAQ Russia

  • Working hours in Russia

    In general, article 91 of the Labour Code provides for a maximum 40-hour working week.

  • What are the main holidays in Russia?

    Public holidays:

    • New Year’s Day.
    • Orthodox Christmas.
    • Defenders of the country Day.
    • International Women’s Day.
    • Labor Day holiday.
    • Victory Day.
    • National Day (Russian independence).
    • Unity Day.
  • What are payroll taxes in Russia?

    Taxable income includes salaries and other forms of remuneration (including insurance and other benefits) provided by an employer to its employees. The employer withholds a 13 per cent individual income tax from almost every payment made to an employee (certain exceptions apply).

    Any payments that are made to Russian employees are subject to social contributions that must be paid by the employer. The basic rates and thresholds are:

    •  pension fund: 22 per cent, or 10 per cent for any amount exceeding a certain threshold that is reviewed annually;
    •  social security fund and medical insurance fund: 2.9 per cent and 5.1 per cent, respectively.

    The employer is also required to make contributions to the social insuance fund in accordance with the law on mandatory social insurance for industrial accidents and occupational diseases. The amount to be paid as contributions depends on the types of operations the employer is engaged in and the risks involved. The contribution rate starts from 0.2 per cent.

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