Employer of Record in Russia

Businesses can only operate smoothly in Russia if they comply with local labor laws including drafting compliant employment contract agreements and meeting taxation and payroll obligations. Learn more about the employment laws and regulations in Russia below, to avoid any compliance issues.

Employment Contract Requirements

In Russia, employment agreements are required to be documented in writing. By default, these agreements are considered indefinite unless otherwise specified. However, there is flexibility to terminate a fixed-term contract under specific conditions, provided the duration does not surpass 5 years. The minimum requirements for employment contracts include:

• Identification of both parties
• Date and place of contract conclusion
• Starting date (and duration for temporary contracts)
• Workplace and working hours
• Job title, description, duties, and responsibilities
• Workplace conditions (e.g., risks related to work, compensation)
• Basic salary (including additional benefits)
• Nature of work
• Social insurance contributions

Onboarding Process

We can help you get a new employee started in Russia quickly, with a minimum onboarding time of just 1-2 working days. The timeline starts once the employee submits all required information onto the Playroll platform and completes any necessary local authority registrations.

For non-nationals, the Right to Work assessment (if applicable) may add up to three extra days. Additional time may be needed for follow-ups on this assessment. Please note, payroll cut-off dates can impact the actual start date. Playroll's payroll cut-off date is the 10th of each month unless otherwise specified.

Working Hours in Russia

In Russia, the standard working week consists of 40 hours, distributed as 8 hours per day.

Overtime in Russia

In Russia, overtime is restricted to 4 hours in two consecutive days and capped at 120 hours annually. Compensation is set at 150% of the regular hourly rate for the first 2 hours and increases to 200% thereafter, as stipulated in the employment contract or collective agreements.

Probation Period in Russia

Typically, probation or trial periods in Russia are established through collective agreements. However, it is a customary practice to have a probationary period of 3 months in Russia. For certain positions such as directors, senior managers, etc., this period may be extended to 6 months.

Fiscal Year in Russia

1 January - 31 December is the 12-month accounting period that businesses in Russia use for financial and tax reporting purposes.

Payroll Cycle in Russia

The payroll cycle in Russia is usually bi-monthly, with employees being paid every half month as indicated in collective agreement.

Minimum Wage in Russia

The minimum wage for employees in Russia is typically 120.2625 RUB per hour, amounting to ~19,242 RUB per month for a typical 40 hour work week.

Bonus Payments in Russia

In Russia, there is no legal obligation for employers to make 13th-month salary payments.

Employer Tax Contributions

Employer payroll contributions are generally estimated at an additional 7.8% on top of the employee salary in Russia.

Employee Payroll Tax Contributions

In Russia , the typical estimation for employee payroll contributions cost is around 0%.

Individual Income Tax Contributions

The individual income tax in Russia is calculated using simple progressive rates based on income.

Pension in Russia

In Russia, retirees typically receive an average gross pension of around 19,000 RUB Russian rubles, reflecting an increase of approximately 2,438 RUB compared to the previous year.

Mandatory Leave Entitlement in Russia

The annual leave entitlement in Russia is 20 days for a full time worker. These can include public holidays on top of that or within those days, which would otherwise be unpaid.

Public Holidays In Russia

The following 8 public holidays are celebrated in Moscow, Russia:

Paid Time Off in Russia

Employees in Russia are entitled to 28 calendar days of paid leave annually, with a minimum of 14 consecutive days. Certain employee categories may receive additional leave. Vacation pay, equivalent to the average salary of the past 12 months, must be paid at least 3 days before leave, and any unused vacation days carry over for an extra 12 months.

Maternity Leave In Russia

In Russia, pregnant employees receive a 708.23 RUB early registration allowance for the first 12 weeks, while maternity leave allowance, capped at 340,795 RUB for 140 days, is calculated based on average daily wage. Childbirth allowances and childcare leave up to 3 years, with a maximum allowance of 29,600.48 RUB for 1.5 years, are directly paid by the social fund to employees. Standard maternity leave comprises 140 calendar days – 70 days before the expected delivery date and 70 days after childbirth.

Parental Leave In Russia

Relatives or guardians caring for a child up to 18 months receive paid parental leave covered by the Russian Federation's Social Insurance Fund. They are entitled to 5 days of unpaid leave after the child's birth and, when raising the child without the mother, receive benefits akin to those offered to women.

Paternity Leave In Russia

In Russia, there is no specific statutory paternity leave. However, fathers can utilize parental leave provisions.

Sick Leave In Russia

In Russia, employees are entitled to sick leave for illness or injury. Employers cover the sick leave allowance for the first 3 days, and from the fourth day onward, the Social Insurance Fund takes over. The daily allowance, depending on the employee's service length, does not exceed 2,301 RUB but can be higher if chosen by the employer, applicable even for those caring for a sick child or relative.

Bereavement Leave

Employees are granted 5 days of paid leave in the event of the death of a family member.

Study Leave

Employees pursuing higher education are eligible for 40 days of paid leave in the initial two years of study and 50 days of paid leave for the subsequent term, with the employer covering the allowance.

Termination Process in Russia

Terminations in Russia must be done for a just cause, and at-will termination is not allowed. Compliant terminations include:

• Mutual agreement
• Voluntary employee resignation
• Unilateral decision by employer in accordance with the law (e.g., probationary period, company liquidation, staff reduction, failure to fulfil work duties without valid reasons, or cases of gross violations)
• Contract expiration

Notice Period in Russia

In Russia, providing notice periods is not mandatory except in specific situations, such as dismissals resulting from company liquidation, redundancy, unsuccessful probation, or the conclusion of a fixed-term contract. Some instances are:

• Employee laid off by company: 2 months notice period (payment can be in lieu of notice)
• Expiration of fixed-term contract: 3 days notice
• Unsuccessful probation period: 3 days notice

Severance in Russia

In Russia, termination due to liquidation or redundancy results in severance pay equal to the average monthly wage. Employers support dismissed employees for two months in their job search. If no job is found by the third month and the employee registered promptly with the employment service, they qualify for specific benefits.