Cabinet of Ministers approved the draft of the new Labor Code: what is envisioned

The Cabinet of Ministers approved the draft of a new Labor Code to replace the one that had been in force in Ukraine since 1971. The document is intended to kickstart labor market reform. This was announced by Prime Minister Yulia Svyrydenko, as reported by UNN.

Today, at a government meeting, we adopted the draft Labor Code of Ukraine, which is intended to kickstart labor market reform. The Ministry of Economy team worked on creating the document for over two years – in partnership with businesses, trade unions, academics, and with the participation of international partners. I had the opportunity to initiate and coordinate this process while serving as Deputy Prime Minister. I am glad that the team successfully completed an important stage for the start of the reform 

According to her, the document is one of the key steps for implementing the Population Employment Strategy until 2030, which the government also adopted today during the meeting.

She emphasized that the Code enshrines clear signs of labor relations. The document defines 8 signs of labor relations. This will help reduce legal uncertainty and bring employment out of the shadows. Preliminary estimates for the de-shadowing of the labor market are 43 billion hryvnias per year.

It also provides for flexible employment contracts: the number of types of employment contracts increases from 6 to 9. The Code clearly regulates modern work formats: remote, home-based, and non-fixed working hours. In addition, an employee will be able to conclude several types of employment contracts with an employer.

Digitalization of labor relations. Electronic documents are equated to paper documents in labor relations. A transparent mechanism for determining the minimum wage, both monthly and hourly, aligned with EU standards. The minimum threshold will be determined as a percentage of the average wage, which will be set by the government. Flexible work arrangements for employees with children. The Code enshrines the right to flexible forms of work (remote, home-based work). It also gives more opportunities to parents. For example, expanding the rights of both parents to parental leave: both the mother and the father will be able to take two months of leave 

The Prime Minister also emphasized that a reform of the labor inspection is envisaged: a risk-oriented approach to inspections is being introduced; as well as more opportunities for youth employment. In particular, the Code introduces a separate mechanism for safely combining education and first work – a student employment contract.

The next step is the consideration of the draft in the first reading in the parliament hall. We count on the support of people's deputies and constructive work on the document between readings 

Recall

The draft of the new Labor Code has been finalized and is being prepared for submission to the Cabinet of Ministers, after which it will be submitted to the Verkhovna Rada.