Minimum Wage

In Kazakhstan, the minimum wage is set at 70,000 KZT per month as of 2024. This wage is intended to ensure that all workers receive a basic standard of living. Employers must comply with this regulation to avoid penalties and ensure fair compensation for their employees.

Minimum Wage Rate	Monthly Equivalent
70,000 KZT	70,000 KZT

Income Tax

Kazakhstan employs a flat personal income tax rate of 10% on most types of income, including salaries. This tax is withheld by employers from employees’ gross salaries and remitted to the tax authorities. In addition to income tax, employees are also required to contribute to social security and health insurance.

Income Tax Breakdown

Tax Type	Rate (%)
Personal Income Tax	10%
Health Insurance (OMIC)	2%
Pension Fund Contribution	10%

Employers are responsible for withholding these taxes from employees’ salaries and ensuring timely payments to the respective authorities.

Payroll Cost

The overall payroll cost for employers in Kazakhstan includes several components, such as social contributions and taxes. The total cost typically ranges from 16% to 21% of an employee’s gross salary, depending on various factors such as the nature of employment and additional benefits provided.

Employer Payroll Contributions

Contribution Item	Rate (%)
Social Insurance	3.5%
Medical Insurance	3%
Social Tax	9.5%

These costs must be factored into the overall budget when hiring employees in Kazakhstan.

Overtime Pay

In Kazakhstan, the standard working week is defined as 40 hours, with any hours worked beyond this considered overtime. Overtime pay must be compensated at a higher rate, typically at 1.5 times the regular hourly wage for the first two hours and double the regular rate for any additional hours worked.

Overtime Pay Regulations

Overtime Duration	Pay Rate
First 2 hours	150% of regular pay
Subsequent hours	200% of regular pay

Employers must ensure that overtime work is agreed upon in writing by both parties to avoid disputes and ensure compliance with labor laws.Understanding these aspects of pay and tax regulations in Kazakhstan is crucial for compliance with local laws and ensuring fair treatment of employees. By adhering to these guidelines, employers can create a positive work environment that supports employee satisfaction and productivity.

Regular & Maximum Working Hours

In Kazakhstan, the regular working hours are defined by law to ensure fair labor practices. The standard workweek is set at 40 hours, typically distributed over 5 days, with employees working 8 hours per day. Employers must adhere to these regulations to maintain compliance with labor laws.

Working Hours Overview

Working Hours Category	Description
Regular Daily Hours	8 hours
Maximum Weekly Hours	40 hours
Maximum Daily Hours	12 hours (including overtime)

Overtime work is permitted but must be compensated at a higher rate. The maximum allowable overtime is capped at 2 hours per day and 12 hours per month.

Leave

Employees in Kazakhstan are entitled to various types of leave, which are essential for maintaining work-life balance. The key types of leave include:

Annual Leave

Employees are entitled to a minimum of 24 calendar days of paid annual leave each year. This leave can be taken in portions, but at least one portion must be no less than 14 consecutive days. Unused leave can generally be carried over to the next year, but it should be used within three years of accrual.

Sick Leave

Employees are entitled to 3 days of paid sick leave per calendar year, which may extend to 6 days in cases of severe illness. A medical certificate is required for sick leave.

Maternity Leave

Female employees are entitled to 126 days of paid maternity leave, which includes 70 days before the due date and 56 days after birth. In cases of complications or multiple births, the leave may be extended.

Other Types of Leave

Leave Type	Duration
Annual Leave	24 calendar days
Sick Leave	3 days (extendable to 6 days)
Maternity Leave	126 days (70 days before and 56 after)
Unpaid Leave	Up to 5 days for personal reasons

Employees can also take up to 5 days of unpaid leave for significant life events such as marriage or bereavement.

Holidays

Kazakhstan recognizes several public holidays throughout the year, providing employees with additional time off work. The main public holidays include:

Holiday Name	Date or Occasion
New Year’s Day	January 1
International Women’s Day	March 8
Nauryz Meyrami	March 21
Defender’s Day	May 7
Victory Day	May 9
Kurban Ait	Varies (Islamic calendar)
Constitution Day	August 30
Independence Day	December 16

These holidays are typically paid days off, and if they fall on a weekend, employees may receive an alternative day off.Understanding these regulations regarding working hours and leave entitlements is crucial for employers and employees alike in Kazakhstan. By adhering to these guidelines, employers can foster a positive work environment that promotes employee satisfaction and compliance with local labor laws.

Termination Requirements

In Kazakhstan, the termination of employment contracts is governed by the Labor Code, which outlines the conditions under which an employer or employee can terminate a contract. Employers can terminate a fixed-term contract for reasons such as business needs, personal reasons, or employee misconduct. In all cases, proper notice and a written explanation for the termination are required.

Key Termination Conditions

Termination Type	Description
Business Reasons	Termination due to organizational changes or restructuring.
Personal Reasons	Termination based on personal circumstances affecting the employee.
Misconduct	Termination due to employee’s violation of workplace policies.

If the reason for termination is misconduct, the employer must issue a warning and give the employee an opportunity to explain their actions before proceeding with termination.

Notice Period

The statutory notice period for terminating an employment contract in Kazakhstan is one month. This means that either party must provide at least one month’s written notice to the other party before termination. However, if both parties agree, payment in lieu of notice is permissible.

Notice Period Overview

Employment Duration	Notice Period Required
Less than 6 months	2 weeks
More than 6 months	1 month

In cases of immediate dismissal for serious misconduct, no notice is required.

Severance Pay

Kazakhstan does not have specific laws mandating severance pay; however, in certain situations such as company liquidation or mass layoffs, employees may be entitled to severance compensation. The amount of severance pay can vary based on the employment contract or collective agreements.

Severance Pay Guidelines

Circumstance	Severance Pay Entitlement
Company Liquidation	One average monthly salary
Workforce Reduction	Two average monthly salaries

Employers should ensure that any severance provisions are clearly stated in employment contracts to avoid disputes.

Probation Periods

The probation period in Kazakhstan is typically set at a maximum of three months. During this time, either party may terminate the employment contract with minimal notice requirements. The probation period allows both employers and employees to assess the suitability of the employment arrangement.

Probation Period Overview

Duration	Notice Requirements
Up to 3 months	No formal notice required

Employers should clearly outline the terms of probation in employment contracts, including evaluation criteria and potential outcomes.Understanding these aspects of termination regulations in Kazakhstan is essential for both employers and employees. By adhering to these guidelines, employers can ensure compliance with local labor laws while fostering a fair and respectful workplace environment.

Contractor Misclassification

In Kazakhstan, the distinction between independent contractors and employees is crucial for legal and tax purposes. Misclassification occurs when an employer incorrectly labels an employee as a contractor, leading to potential legal ramifications. Understanding the differences is essential to avoid penalties and ensure compliance with local laws.

Key Differences Between Contractors and Employees

Independent contractors operate as self-employed individuals, providing services under specific contracts without the same obligations that employers have towards employees. Here are some of the primary differences:

Aspect	Independent Contractor	Employee
Employment Status	Self-employed	Legally part of the company
Control	Operates independently	Works under employer’s supervision
Benefits	No statutory benefits	Entitled to benefits (e.g., health insurance, paid leave)
Tax Responsibilities	Responsible for own tax filings	Employer handles tax withholdings
Termination Rights	Contract-based, flexible	Subject to employment laws

Misclassification can lead to significant liabilities for employers, including back payments for benefits and taxes. If a contractor is deemed to be functioning as an employee, the employer may be required to pay for unpaid wages, social security contributions, and other employee benefits.

Legal Considerations for Hiring Contractors

When hiring independent contractors in Kazakhstan, it is important to draft clear contracts that outline the terms of engagement. Key elements to include are:

• Scope of Work: Clearly define the services to be provided.
• Payment Terms: Specify rates and payment schedules.
• Intellectual Property Rights: Address ownership of any work produced.
• Confidentiality Clauses: Protect sensitive business information.
• Termination Conditions: Outline how either party can terminate the contract.

Properly structured contracts help mitigate risks associated with misclassification and ensure that both parties understand their rights and obligations.

Risks Associated with Misclassification

Misclassifying employees as independent contractors can result in several risks, including:

• Legal Penalties: Employers may face fines or legal action if found in violation of labor laws.
• Financial Liabilities: Potential back payments for unpaid wages, taxes, and benefits owed to misclassified workers.
• Reputation Damage: Legal disputes can harm a company’s reputation and employee relations.

To avoid these risks, employers should regularly review their classifications and ensure compliance with local regulations.