According to the requirements of the current labor legislation of Ukraine, no employee can be allowed to work without a labor contract, which must be formalized through an order or directive issued by the employer or an authorized body. There is no strict requirement for a mandatory written form of the labor contract, except in certain cases listed in Article 24 of the Labor Code (e.g., with an individual employer, with a minor, or when the employee insists on a written contract).
However, the labor contract is essentially a legal structure that outlines the rules of the relationship between the employer and the specific employee, including the rights and obligations of both parties, working hours, rest periods, the contract’s duration, and other terms of cooperation. Additionally, the labor contract may include individual provisions such as confidentiality, protection of trade secrets, adherence to fair competition rules, etc. Job responsibilities can also be detailed in a job description, which must be approved by the employer’s order and communicated to each employee under signature, along with internal labor regulations and other local company acts.
Therefore, only by formalizing the labor contract in writing can the employer clearly establish, at the outset of employment, the specific requirements expected from the employee, which contributes to better mutual understanding and the avoidance of labor conflicts. In case the employee violates these requirements and is subject to disciplinary action, such as a reprimand or dismissal under paragraph 3 of Article 40 of the Labor Code (for systematic non-fulfillment of duties without valid reasons as outlined in the labor contract or internal labor regulations), the employer will find it much easier to substantiate their legal position if there is a written list of the employee’s labor obligations in the contract.
Moreover, due to its legal nature, a labor contract is not a civil law agreement, and therefore the principle of freedom of contract does not fully apply to labor relations. According to Article 9 of the Labor Code, the terms of labor contracts that worsen the employee’s position compared to Ukrainian labor legislation are invalid. This limitation also applies to contracts, as noted by the Constitutional Court of Ukraine in paragraph 5 of Decision No. 12-rp/98, dated July 98, 1998.
It is also crucial to address the current issue of reclassifying civil law relations as labor relations when agreements with individuals or sole proprietors (FOPs) are formally civil law agreements but in essence establish labor relations. This requalification can be carried out by regulatory bodies (State Labor Service or the State Fiscal Service) and may result in significant fines for the company, tax recalculations, and the criminal liability of company officials under Articles 172 and 212 of the Labor Code.
Therefore, employers must be extremely cautious when drafting labor contracts, as even a seemingly minor mistake could have negative consequences, leading to a labor dispute in court or other unfavorable outcomes. Early legal preparation and support for the conclusion of labor contracts significantly mitigate these risks and help the employer avoid being distracted by problems with employees or regulatory authorities.
The attorneys at WinnerLex Law Firm provide legal assistance in drafting labor contracts and agreements with both company executives and employees, including:
- Preparation of fixed-term and indefinite labor contracts, part-time agreements, as well as contracts for specific tasks;
- Drafting contracts with necessary terms and conditions;
- Creating labor contracts tailored to the specific nature of the business (for employees in IT, consulting, etc.);
- Handling employment arrangements for foreign nationals and stateless persons;
- Addressing tax risks when entering into labor contracts;
- Application of material liability.
Practice experience: 19 years
Specialization: litigation support, tax, customs and antitrust practices, agricultural law, IT and M&A
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Practice experience: 11 years Specialization: tax, customs and corporate disputes, support of inspections, contractual activities
Practice experience: 6 years
Specialisation: business and civil law, tax and customs practice, corporate law, registration and reorganisation of business
Practice experience: 11 years Specialization: support of economic, civil, labor and administrative disputes, inspections
If, after the expiration of the fixed-term employment contract, the parties have not discussed its termination and neither party requires its termination, the contract does not need to be extended in writing, as its extension is automatic. The term of such an employment contract continues indefinitely.
Employers need to pay attention to the content of employment contracts, as the contract must contain mandatory elements, such as the personal data of the employee being hired, details about the employer, the position, salary, working hours, responsibilities of the parties, etc.
The employer is required to pay employees’ wages at least twice a month, with no more than 16 calendar days between payments, and no later than 7 days after the end of the period for which the payment is made.
The employment contract is concluded between two parties and enters into force upon its personal signing by all parties.
According to part two of Article 23 of the Labor Code of Ukraine, a fixed-term employment contract is concluded when the employment relationship cannot be established for an indefinite period due to the nature of the work, conditions for its performance, the interests of the employee, or other cases provided by legislative acts.
- When hiring employees in an organized manner;
- When concluding an employment contract for work in areas with special natural, geographical, or geological conditions, or with increased health risks;
- When entering into a contract;
- In cases where the employee insists on a written form of the employment contract;
- When entering into an employment contract with a minor;
- When entering into an employment contract with an individual;
- In other cases specified by the legislation of Ukraine.
Yes, it is mandatory. It should be noted that a labor book must be created for each employee. The labor book must be completed no later than one week from the moment the employee is hired, meaning entries should be made regarding the new place of employment, position, and the date from which the employee occupies the corresponding position. The labor book is stored by the responsible person at the employee’s place of work, and the employee receives the labor book upon termination of employment or in specific cases. At the same time, the responsibility for the preservation of the labor books lies with the employer.
