11 thousand violations of labor legislation revealed by tax authorities since January 2024
19 February 2025 15:56
In 2024 and January 2025, the State Tax Service of Ukraine recorded about 11 thousand cases of violations of labor laws and submitted the relevant materials to the State Labor Service of Ukraine. This was reported by the State Tax Service, "Komersant Ukrainian" reports.
According to the tax authorities, many employers are still trying to save on taxes by using illegal labor.
The scheme works simply: the employer sets the official salary at the minimum wage or even lower, and the employee receives the rest of the amount “in an envelope”.
But the consequences of such a scheme for both the employer and the employee can be quite serious.
What penalties can the employer expect
The liability of business entities that use unofficial hired labor is provided for in part two of Article 265 of the Labor Code of Ukraine. Fines are imposed by the State Labor Service.
Since the beginning of martial law, fines have not increased, but there have been changes in labor legislation and an increase in the minimum wage, which has led to an increase in fines.
Starting from January 1, 2025, according to the Ukrainian legislation on the state budget for this year, the minimum wage is UAH 8,000. Therefore, the fine for illegal employment or payment of wages “in an envelope” is UAH 80,000 for each employee.
There are also penalties for a number of other violations:
– a fine of 4 times the minimum wage (UAH 32,000) for each employee who was not provided with legal guarantees and benefits;
– a fine of 3 times the minimum wage (UAH 24,000) for violation of the terms of payment of wages or for incomplete payment of wages, as well as for obstructing inspections;
– a fine of 2 times the minimum wage (UAH 16,000) for each employee who was not provided with minimum state guarantees in labor remuneration;
– a fine of one minimum wage (UAH 8,000) for other violations of labor laws, and a fine of two minimum wages (UAH 16,000) for repeated violations within a year.
What problems can an illegal worker face?
An informal employment scheme creates many serious risks for an employee. For example, they may be “forgotten” to be paid or paid only a part of the promised salary. Such an employee may also be offered to forget about paid vacations and sick leave.
They may also face problems with their official seniority and pension benefits.
However, the Ministry of Social Policy of Ukraine does not forget about such employees.
They remind us: “if a person is not officially employed but has an income and wants to pay voluntary insurance contributions to earn seniority and receive a pension, he or she can pay them voluntarily, at his or her own request.”
The Ministry emphasizes that “in order for a person who is not working to be credited with one full month of insurance experience, the amount of contributions paid for this month must be at least the minimum insurance contribution, i.e. UAH 1,760. If a person pays twice as much, the pension will be calculated on the basis of the double minimum wage.”
