According to Ukrainian recruiters, only 54% of locals work officially. 18-19% of people have no official contracts, while one third receives some part of wages by contract and the rest in cash without declaring the income.

Official and unofficial employment in Ukraine

Yulia Drozhina from Head Hunter Ukraine explained to journalists that one third of the people who are officially employed in Ukraine are only being paid the minimum wage, as allowable under the law. The rest of their earnings are paid in cash.

This is one of the ways how employers are able to pay less in taxes, since the social contribution per worker is lower.

In addition, about 18% of people don’t have official employment contracts at all. This is also useful for employers, since it’s hard to fire someone who is employed officially.

Workers also often don’t worry about the paperwork and happy to fulfill their duties without a proper agreement. Especially it’s typical for young people.

Mature workers prefer official employments.

Drozhina believes that companies should face heavier fines if they do not employ people correctly as required by the law. It’s also necessary to explain to people their rights and advantages of legal employment such as paid vacations, social security, as well as pension contributions that will become important later in life.

The events of March 2020 with the worldwide economic shake up and looming depression are likely to exacerbate the situation with unofficial workers in Ukraine. How this will play out we’ll see in a few months.

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