Remote work isn’t just a neat idea, it’s nearly a requirement for many tech companies that want to scale rapidly in the current talent market. Uzbekistan had long been underutilized and underrated for its tech talent, and now even more tech talent is migrating to Uzbekistan. If you want to capitalize on the talent there and use them to help build your product, then you are going to want to be aware of some common compliance mistakes for remote work in Uzbekistan.
Are Uzbekistan’s Employment Regulations Similar to the U.S.?
Every country is different when it comes to how they govern its people. Search the globe, and you will be hard pressed to find two countries that are completely alike in how they manage employment. There are some legal areas that you will want to be aware of and many common compliance mistakes that people run into when working in Uzbekistan. Don’t worry, you can keep reading to learn one simple trick that everyone is using to avoid all these compliance mistakes and more. (Spoiler Alert: It might be TRUSS)
1. Incorrect Handling of Taxes
No one likes taxes, but if there’s one thing you always want to get right, it’s those. Remember Al Capone? He got away with a lot, but even he went down for tax evasion. We hope you are more honorable than Al Capone, but either way, at least make sure you are paying your taxes appropriately.
In Uzbekistan, there is a flat income tax set at 12% which is easy enough to understand. Additionally, the employer will have to pay 12% for social security and an additional 0.1% for pension.
2. Contract Violations
In many other countries, Uzbekistan included, employment contracts are much more a part of everyday life than they may be in the states. You are going to ask a lot of your employees, and they are going to ask a lot of you as well.
Just make sure that your relationship continues within the bounds of the contract that you both agreed to as Uzbekistan law is going to enforce that contract, and adhering to that contract will also help you adhere to other Uzbekistan laws that were likely considered when drafting the contract in the first place.
3. Mistakes in Overtime or Vacation
The U.S. is much more relaxed in terms of overtime regulations than many other countries, Uzbekistan included. You will want to consider this both when trying to issue over time and even when drafting and signing those aforementioned employment contracts.
If an employee is asked to work on holidays or more than 40 hours you’ll want to ensure that you are not going outside the bounds of that contract. Additionally, most contracts stipulate that overtime is to be paid at 200% of their regular rate. Don’t forget too that Uzbekistan has different holidays than we have here, and you need to honor them.
4. Termination and Severance Errors
Termination, end of employment, firing, or whatever you want to call it, you likely (hopefully) aren’t thinking about it while you’re hiring, but Uzbekistan works a little differently than the U.S. here too. No one can be terminated the same day without notice. Even for gross misconduct—which you will want to document— you are required to give 3 days of notice.
For redundancy or even a change in the company’s ownership, you will have to give 2 months of notice. If the employee lacks qualifications or has a health issue that impedes their ability to complete work, then you will need to provide 2 weeks of notice. You are allowed to provide payment in lieu of notice though.
Best Practices For Global Remote Hiring
How To Prevent Compliance Mistakes in Uzbekistan
After seeing this list, it’s understandable if you are a little hesitant to do remote work in Uzbekistan, but it’s the same everywhere. A lot of laws, regulations, and restrictions that you have to adhere to, and they are all a little different.
This is why it’s best not to go into it alone. You need a trusted partner, a global remote hiring expert, and a support system. Frankly, you need TRUSS. We can be your employer of record in Uzbekistan and allow you to focus on building your business with a truly world-class team. It really can be that simple. Reach out to TRUSS today!