☑️ The Basics

Currency: RUB, Russian ruble (Rate)

Public Holidays: 11 public holidays (see here)

Employer Taxes: ~30% of gross salary

Official Language: Russian

Payroll frequency: Bi-monthly

Three things to know about employing in Russia

1. Collective agreements and trade unions are very active in Russia. Collective agreements offer protection against staff redundancy and trade unions protect and negotiate the rights of employees with the management of the company.
2. If, after termination, an employee fails to find an alternative job within two months, they can obtain a letter from the Employment Fund which entitles them to receive an additional month’s salary from their previous employer.
3. Bonuses are common in Russia, and there are various sector-specific guidelines on them.

Employment in Russia

Notice Period

The notice periods vary by nature of termination of the agreement:

• During probation period: Three days’ notice
• Expiry of the fixed-term contract: Three days’ notice
• Resignation from indefinite employment agreement: Two weeks' notice
• Termination due to redundancy or liquidation: Two months’ notice

No notice is required for cases of termination for cause.

Termination & Severance

Severance pay depends on the grounds for the termination. In case of staff redundancy or company liquidation, it is equal to one month’s salary, plus average monthly salary for a two-month period after dismissal, when the employee is searching for alternative work.

If the employee fails to find an alternative job after two months, they can obtain a letter from the Employment Fund which entitles them to receive an additional month’s salary from the employer.

In case of termination due to an employee’s refusal to transfer to a different position in the company or loss of the ability to work, severance pay is equal to two weeks’ salary.

Probationary period

Three months. This can be extended to six months for senior positions.

Minimum Wage

Ranges from 12,130 RUB to 21,060 RUB per month, but can be higher in certain regions.

IP protection and non-compete agreements

Non-compete agreements are not covered under Russian law and their enforceability is questionable.

Working Hours

Eight hours per day, 40 hours per week.

Overtime

Hours worked over 40 hours per week are considered as overtime and are paid at a higher rate of 150% of the regular pay rate for the first two hours and at 200% for all subsequent hours worked within a day.

Work during weekends and on public holidays is paid at a minimum of 200% of the regular pay rate. However, employees can agree to be compensated by receiving regular pay plus an additional day off.

Overtime work should not exceed four hours in two successive days and 120 hours per year.

Paid Holidays

Employees are entitled to 28 paid vacation per year. Some employers might offer more days.

Employers are required to pay out the vacation allowance at least three days before the vacation is due to start.

Sick pay and time off

Sick leave allowance entitlement depends on employees' length of service and is capped at 2,301 RUB per day.

This payment is paid from the Social Insurance Fund from insurance payments made by the employer, and its amount depends on the length of service. It can vary from 60% to 100% of the employee's average salary over the previous two years.

Parental leave

Employees are entitled to 140 days' fully paid maternity leave (170 days in case of multiple pregnancy), as well as additional paid childcare leave until the child reaches the age of 18 months. The allowance is covered by the Social Security Fund. A maximum amount is determined every year and the cap was RUB2,301.37 per day in 2020.

Pregnant employees can also make a request to work part-time.

Employees are also entitled to partly paid parental leave till the child reaches the age of 18 months; this is also paid by the Social Security Fund, and the allowance is equivalent to 40% of the person's average salary over the previous two years. A maximum amount is determined every year. It was RUB27,984.66 per month in 2020.

Taxes in Russia

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Employees

Social Security (2.9%)

• Up to wages of RUB 912,000 per annum. Earnings above this cap are not subject to contributions.

Income tax: Flat rate of 13%

Employers

Total social contributions (~30%)

• State Pension Fund: 22% up to wages of RUB 1,292,000 per year, and 10% for any amount over it.
• Social Insurance Fund: 2.9% up to wages of RUB 912,000 per year.
• Medical Insurance Fund: 5.1%
• Accident Insurance: At least 0.02%

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