Employer of Record (EOR) Belarus

Roles and Responsibilities of the Employer of Record in Belarus

• Legal Compliance: Ensure that all aspects of the worker’s employment adhere to Belarusian labor laws and regulations.
• Payroll Management: Manage the local payroll system, guaranteeing accuracy and timeliness in payments.
• Tax Filing: Take care of the filing for employment-related taxes and all necessary documentation.
• Benefits Administration: Provide all legally required benefits to employees as stipulated by Belarusian law.
• Payslip Distribution: Issue detailed payslips to employees, promoting transparency in their compensation.

In Belarus, our Employer of Record services go beyond simple legal compliance. Partnering with Mercans as your trusted Employer of Record means you can enjoy a hassle-free solution without the need to establish a local entity. Our dedicated team handles payroll, taxes, and the provision of required benefits, ensuring a seamless employment experience for your global workforce.

With Mercans as your Employer of Record in Belarus, you can navigate the legal intricacies with confidence, ensuring your employees’ employment aligns with local regulations. Our responsibilities include managing local payroll processes, overseeing the submission of employment-related taxes and essential documents, and providing employees with comprehensive payslips.

Things you need to know before hiring in Belarus

Understanding Employment Contracts in Belarus

In Belarus, employment relationships are governed primarily by two types of agreements: Individual Employment Contracts and Collective Bargaining Agreements. These contracts set out the rights and responsibilities of employers and employees, ensuring clarity in the working arrangement.

Individual Employment Contracts: Tailored Agreements for Each Employee

Individual employment contracts are the most common form of agreement between an employee and employer in Belarus. These contracts are legally required to be in writing and must clearly outline the specific terms and conditions of employment. Each contract typically includes:

• Full identification of the employer and employee
• Date of contract signing
• Details on the work location
• Job description, specifying duties and responsibilities
• Working hours and expectations regarding overtime
• Leave entitlements, including paid holidays and vacation days
• Base salary and other compensation, including allowances and benefits
• Social security contributions

Contract Durations

Belarusian law allows for various contract types based on the expected duration of employment:

• Permanent Contracts: The default type for most positions, these contracts provide job security without a specified end date.
• Fixed-Term Contracts (up to 5 years): Used for roles with a known timeframe, such as projects or temporary positions.
• Project-Based Contracts: These contracts last until the completion of a specific task or project.
• Seasonal Contracts: Common in industries with seasonal peaks, such as agriculture and tourism, these contracts are limited to the duration of the season.
• Temporary Replacement Contracts: Applied when an employee is temporarily replaced, for example, during maternity or sick leave.

Collective Bargaining Agreements: Protecting Workers’ Rights at Scale

In addition to individual contracts, Collective Bargaining Agreements (CBAs) play a crucial role in Belarusian workplaces. These agreements are negotiated between employers and representatives of employees, such as trade unions, and establish terms and conditions that apply to a broader group of employees, typically across an entire organization or industry.

Given that approximately 95% of Belarusian workers are unionized, CBAs are significant in shaping working conditions. The terms negotiated in these agreements typically cover:

• Minimum wage levels and salary adjustments
• Working hours and overtime policies
• Employee benefits, such as health insurance and pension contributions
• Opportunities for professional training and development
• Health and safety standards in the workplace
• Procedures for resolving workplace disputes and grievances

Key Legal Requirements in Employment Contracts

Belarusian labor laws mandate that specific clauses must be included in employment contracts to ensure legal compliance and clarity for both parties.

Key Clauses Include

• Parties Involved: Clear identification of the employer and employee, along with relevant registration or legal details.
• Start Date and Contract Term: Whether the contract is indefinite, fixed-term, or project-based, this clause specifies when employment begins and when it might end.
• Work Location: Details where the employee will be based, with mention of remote work possibilities if relevant.
• Job Description: A comprehensive list of job duties, providing clarity on what is expected from the employee in their role.
• Working Hours and Overtime Policies: Outlines the standard working hours and specifies compensation for any overtime worked.
• Compensation and Benefits: Describes the salary structure, including how and when payments are made, along with additional benefits such as bonuses, health insurance, or transportation allowances.

Comparing Contract Types: Flexibility vs. Stability

The combination of Individual Employment Contracts and Collective Bargaining Agreements creates a flexible yet structured employment framework in Belarus. While individual contracts provide specific terms tailored to each employee’s role, collective agreements cover broader protections that benefit entire groups of employees.

• Individual Contracts provide detailed, personalized terms of employment.
• Collective Bargaining Agreements ensure that key worker protections—like fair wages and safe working conditions—are uniformly applied across the workforce.

Working Hours

In Belarus, the typical workweek consists of 40 hours, with employees usually working 8 hours each day for 5 days. The standard workday generally begins around 9:00 or 10:00 AM and concludes by 6:00 or 7:00 PM, including a lunch break that lasts between 30 minutes to 1 hour.

Probation Period

Employers may choose to establish a probationary period of up to 3 months.

13th Month Salary

Bonuses and a 13th-month salary are common but not legally required.

Termination, Severance Pay, and Notice Period

In Belarus, employment contracts can be terminated under several conditions. Contracts may end by mutual agreement between both parties or upon the expiration of the contract’s term, unless either side wishes to extend the employment relationship. Termination can also occur at the request of the employer or the employee. Additionally, if an employee agrees to a transfer to another employer or a new position, or if they refuse relocation, reject new working conditions, or disagree with changes in ownership or company reorganization, the contract may be terminated. Contracts can also be ended in situations beyond the control of either party or after the completion of the probationary period.

The amount of severance pay is contingent upon the circumstances surrounding the employee’s termination and can be up to three months’ salary, although typically no severance is awarded in cases of mutual agreement or when the employment contract expires.

Notice Period

According to the Labor Code in Belarus, a minimum notice period of one month is required for employment termination. This applies to both employers and employees, unless a different notice period is outlined in the employment contract or collective bargaining agreement.

Severance Pay

In Belarus, severance pay is contingent upon the circumstances surrounding an employee’s termination. Here are the key points regarding severance pay:

• Eligibility: Severance pay is generally applicable when an employee is terminated under specific conditions, such as layoffs or dismissals without cause. It is important to note that severance pay is not typically awarded in cases of mutual termination or when an employment contract expires naturally.
• Amount: The severance pay can amount to up to three months’ salary, depending on the grounds for termination. The specific calculation may take into account the employee’s length of service, the reasons for termination, and any applicable provisions in the employment contract or collective bargaining agreement.
• Payment Timing: Severance pay is usually disbursed at the time of termination or as specified in the employment contract. Employers are responsible for ensuring that the severance payment is made in accordance with the labor laws and contractual obligations.
• Legal Framework: The Labor Code of Belarus governs the provisions related to severance pay, establishing minimum requirements that employers must follow. Employees are encouraged to review their contracts and any relevant collective bargaining agreements to understand their entitlements fully.
• Disputes: In cases where there is a disagreement regarding severance pay, employees may seek recourse through labor courts or relevant authorities to ensure their rights are protected and to resolve any disputes over payment.

Employees vs Independent Contractors

In Belarus, distinguishing between employees and independent contractors is essential, as it establishes the rights, duties, and responsibilities of both parties involved. Misclassification can result in significant legal and financial consequences for both employers and workers.

Comparison of Employees and Independent Contractors in Belarus

Legal Consequences of Worker Misclassification

Misclassifying workers in Belarus, whether as employees or independent contractors, can lead to several legal consequences for employers. If an employee is mistakenly classified as a contractor, the employer may face liabilities such as unpaid taxes and social security contributions, as employers are required to withhold and submit these for their employees. Misclassified workers may also be entitled to retroactive benefits like paid leave and sick leave. On the flip side, if a contractor is incorrectly labeled as an employee, they may lose access to benefits associated with self-employment, such as business expense deductions.

Independent Contract Work

Independent contracting in Belarus offers both businesses and skilled professionals flexibility. Knowing how to structure contracts and negotiate terms effectively is key to successful engagements.

Contractual Agreements

Independent contractors should formalize their agreements in writing, ensuring that key terms are well-defined. These include:

• Scope of Work: A clear description of services, deadlines, and performance expectations.
• Compensation: Details on payment structures, schedules, and any applicable deductions or taxes.
• Confidentiality: Provisions to protect sensitive information.
• Termination: Clear terms around how either party may terminate the agreement, notice periods, and potential penalties.

Negotiation Strategies

To secure a fair agreement, independent contractors should research industry rates to ensure competitive pay, clearly define the scope of work to avoid extra tasks, and negotiate payment terms aligned with project milestones. For more complex or high-value contracts, seeking legal guidance is often beneficial.

Common Industries

In Belarus, industries frequently employing independent contractors include IT, marketing, creative sectors (like design and photography), and consulting in fields such as finance, law, and HR.

Intellectual Property (IP) Concerns

For freelancers and independent contractors, intellectual property rights (IP) are crucial to ensure their creative work is protected. Belarusian law, specifically the “Law on Copyright and Related Rights,” provides guidelines for IP ownership.

Default Ownership

In Belarus, unless otherwise agreed, contractors retain copyright over their creations. However, contracts can assign ownership to the client or establish shared rights. While registration of copyright is not mandatory, it can offer extra protection against infringement.

Work-for-Hire Clause

Under Belarusian law, if a contractor creates a product based on client specifications, the client may claim ownership if this is clearly stated in the contract as a “work made for hire.”

Moral Rights

Even if clients hold copyright, contractors maintain moral rights, meaning they retain credit for their work and can prevent alterations that harm their reputation. Contracts should address how these rights will be managed.

Best Practices

Freelancers should always insist on clear, written agreements that define deliverables, outline ownership, and detail how moral rights will be treated. Consulting with an IP lawyer for complex projects is advisable.

Tax and Insurance Responsibilities

Independent contractors in Belarus are classified as individual entrepreneurs and can choose between simplified tax systems or a unified income tax. They are not automatically enrolled in social security programs but can opt for voluntary contributions to the pension fund. Additionally, contractors can explore various insurance options, including health, professional liability, and property insurance.

Social Security in Belarus

In Belarus, social security is a fundamental component of the welfare system, designed to provide financial support and benefits to individuals at various life stages. Both employees and employers are required to contribute to this system, which funds a range of services, including pensions, healthcare, and social insurance.

Employee Payroll Tax Contributions

Employees in Belarus do not directly contribute to pension and health insurance from their salaries. However, a small portion of their salary goes towards social insurance, which covers temporary disability, maternity leave, and unemployment benefits. Specifically, the contributions from employees are as follows:

• Social Insurance Contributions: 1% of gross salary

Employer Tax Contributions

Employers bear a larger portion of the financial responsibility for social security contributions in Belarus. The contributions from employers are structured as follows:

• Health Insurance Contributions: 28% of gross salary
• Pension Insurance Contributions: 6% of gross salary
• Social Insurance Contributions: 0% (Employer does not contribute)

These contributions ensure that employees receive necessary benefits, supporting their well-being and financial stability.

Social Security Rates for 2024

The following table summarizes the social security contributions in Belarus for 2024, detailing both employee and employer responsibilities:

Types of Social Security Contributions

Pension Fund Contributions

• Funding for retirement pensions, ensuring financial support for individuals post-retirement.

Social Insurance Contributions

• Temporary Disability Benefits: Financial support for employees temporarily unable to work due to illness or injury.
• Maternity and Family Benefits: Support during maternity leave and for child-rearing responsibilities.
• Unemployment Benefits: Financial assistance for individuals seeking employment.

Health Insurance Contributions

• Critical for funding the public healthcare system, ensuring access to medical services.

Social Care Contributions

• Funds services for the elderly, disabled, and vulnerable populations.

Occupational Accident and Disease Insurance Contributions

• Provides compensation for work-related injuries or illnesses, ensuring employee protection.

Employer and Employee Responsibilities

Both employers and employees play a vital role in sustaining the social security system. Employers are tasked with withholding and remitting the appropriate contributions for their employees. Compliance with these contribution requirements is essential for the effective functioning of the social security system, enabling access to necessary benefits when required.

2024 Tax Tables in Belarus

For 2024, the tax structure in Belarus has been outlined as follows:

Personal Income Tax Rates:

• Residents and Non-residents: 13% flat rate on all taxable income.

Social Security Rates and Thresholds:

• Detailed in the social security contributions table above.

Payroll in Belarus

• Minimum Wage: In Belarus, the minimum wage for employees is set at approximately 3.91 BYN per hour, which translates to around 626 BYN per month based on a standard 40-hour work week.
• Payroll Cycle: Belarusian labor regulations require employers to pay their employees on a monthly basis. However, many employers opt to pay employees bi-monthly, disbursing 40% of the salary midway through the month and the remaining balance at the beginning of the following month.
• Overtime Pay: In Belarus, overtime work is limited to a maximum of 10 hours per week and 180 hours per year. Employees are compensated for overtime at a rate of 200% of their regular hourly wage. Alternatively, employers have the option to provide a monthly overtime bonus or offer additional time off instead of monetary compensation.

Mercans’ payroll capabilities

• Payroll Cycle in Belarus: In Belarus, payroll typically follows a monthly schedule and involves key steps such as initial setup, salary processing, and regulatory reporting. Mercans’ Employer of Record (EOR) services manage these stages with accuracy and expertise.
• Payroll Setup, Processing, and Administration: From software configuration to salary processing and managing leave entitlements, Mercans’ EOR services handle every aspect of payroll in Belarus with efficiency and precision.
• Statutory Filings and Payments: Adhering to local regulations is essential. Mercans ensures full compliance with Belarusian laws, providing smooth support for statutory filings and timely payments.
• Local Currency Payments: Mercans also facilitates salary payments in Belarusian rubles, ensuring that employees are compensated in the local currency for added convenience and compliance with local practices.

Personal Income Tax in Belarus

The personal income tax rates and allowances in Belarus are reviewed and updated annually. The following tax rates apply for both resident and non-resident taxpayers in 2024:

Personal Income Tax Rates for Residents

Personal Income Tax Rates for Non-Residents

Belarus Employee Hiring Cost

Salary Details

Let’s suppose a company in Belarus hires an employee with a gross annual salary of BYN 100,000.00. The gross annual salary represents the salary before any deductions or contributions are applied. In addition to the gross salary, the employer incurs additional costs totaling BYN 35,100.00. These costs may include contributions to social security, health insurance, and pensions.

To determine the total expense for the employer, we add the gross annual salary and the employer costs:

Total Annual Cost = Gross Annual Salary + Annual Employer Costs
Total Annual Cost = 100,000.00 + 35,100.00 = 135,100.00

In this scenario, hiring talent in Belarus results in a total annual cost of BYN 135,100.00, which includes both the gross salary and the associated employer costs.

Employee Benefits in Belarus

In Belarus, employee benefits can be divided into two categories: Mandatory Benefits and Supplemental Benefits. Below is a summary of each category, detailing the various benefits available to employees.

Mandatory Benefits

Mandatory benefits are those that employers are legally required to provide to their employees under Belarusian law. These benefits ensure that employees have a basic safety net for various life events, including illness, retirement, and maternity.

Paid Time Off

All employees in Belarus are entitled to a minimum of 24 days of paid leave annually. The payment during this leave is calculated based on the employee’s average salary, with the responsibility for payment resting with the employer.

Sick Leave

Sick leave in Belarus is managed by the Fund of Social Protection of the Population (FSPP), funded through employee wage deductions. Sick leave pay is based on a percentage of the employee’s average daily wage. For employees with less than 10 years of experience, the first 12 days of sick leave are compensated at 80% of the average daily wage, with subsequent days paid at 100%. Employees with 10 years or more of experience receive 100% pay for the entire duration of their sick leave. Maternity and parental leave for caring for a sick child or disabled child under 18 grants employees 100% pay, regardless of work experience.

Pension

The labor pension in Belarus is funded by the FSPP and is available to individuals who have made contributions throughout their working life. To qualify, employees must meet several criteria: a minimum insurance experience of 19.5 years, a total work experience of at least 25 years for men and 20 years for women, and a retirement age of 63 for men and 58 for women. The pension amount is influenced by various factors, including the individual’s wages during their working years.

Social Leave for Childcare

Employees have the right to take up to three years of social leave to care for a child while retaining their job position. Payments during this leave are based on the average salary in the last quarter and are recalculated biannually. The payment for the first child is 35% of the average monthly salary, while for subsequent children, it is 40%. Additionally, childbirth payments are structured around the subsistence minimum, providing financial support during the early stages of parenthood.

Unemployment Benefits

Unemployed individuals registered with the employment service can receive benefits from the Republican budget. The maximum benefit is capped at 2 basic units, approximately BYN 80 (around US$25) per month, with additional surcharges for those with children under 14 or multiple dependents.

Healthcare

All citizens of Belarus have access to free medical care through public health institutions, which is funded by the government.

Compulsory Insurance for Occupational Accidents and Diseases

This insurance provides coverage for employees who suffer health issues or disabilities due to occupational accidents or diseases. The employer holds the policy, and coverage is provided by the state insurance company, Belgosstrakh. All medical expenses and compensation related to injuries are covered based on the employee’s average earnings.

Supplemental Benefits

Supplemental benefits go beyond the mandatory provisions and are typically offered by employers as part of their employment packages to enhance employee satisfaction and attract talent.

Additional Paid Time Off

Many companies offer extra paid leave days beyond the statutory minimum, enabling employees to take more time off for personal matters or extended vacations.

Performance Bonuses

Employers may provide performance-related bonuses, which reward employees for their contributions and achievements throughout the year.

Health and Wellness Programs

Some companies implement health and wellness initiatives, including gym memberships, wellness workshops, and preventive health check-ups to support employee well-being.

Professional Development

Employers often invest in their employees’ growth by providing opportunities for training, conferences, and educational courses that contribute to professional development.

Flexible Working Arrangements

To promote work-life balance, many employers offer flexible working hours or the option for remote work, allowing employees to tailor their work schedules to meet personal needs.

In summary, the employee benefits landscape in Belarus consists of a robust framework of mandatory benefits that ensure fundamental protections for all workers, complemented by supplemental benefits that enhance job satisfaction and support professional growth. These offerings create a supportive work environment conducive to employee well-being and productivity.

Work Permit in Belarus

Work Visa in Belarus

Foreign nationals wishing to work in Belarus must obtain the appropriate work visa and permit to legally enter and engage in employment activities. The types of visas available in Belarus include:

• Type B Visa: This is a transit visa used for passing through the country.
• Type C Visa: This visa allows for short-term visits of up to 90 days and is suitable for business activities, including meetings, conferences, and training.
• Type D Visa: This visa is intended for long-term stays and is necessary for individuals who plan to work in Belarus on a more permanent basis.

For employees involved in short-term business activities during a company’s expansion into Belarus, a Type C Visa is generally required. In contrast, those intending to remain in the country for employment will need to apply for a Type D Visa.

In addition to the visa, international employees must obtain a work permit, referred to as a “Special work permit in the Republic of Belarus,” before commencing employment.

Requirements to Obtain Belarus Work Visas

To apply for a work visa in Belarus, international employees must submit the following documents:

• A completed visa application form.
• A recent passport-sized photo (taken within the last six months).
• A valid passport with a minimum of two blank pages, valid for at least 90 days beyond the intended departure date from Belarus.
• Proof of medical insurance.
• A certified copy of the work permit.
• Proof of payment for the visa fee.

If the applicant chooses to mail the application, they should include return postage. Additionally, some applicants may need to provide extra documentation:

• For applicants under 18 years old, a copy of the birth certificate and copies of the parents’ or legal representatives’ passports are required.
• Individuals who have previously held citizenship in Belarus or the former USSR must provide documentation certifying their loss of citizenship.

Application Process

The application process for a work permit is initiated by the employer in Belarus. The employer must submit a completed application to the Department of Internal Affairs, along with:

• A copy of the prospective employee’s passport.
• Proof of payment for the processing fee.

If the employer intends to hire more than 10 foreign workers, they must also obtain a permit from the Department of Nationality and Migration.

The typical processing time for a work permit is approximately 15 days. Once the work permit is approved, the prospective employee can then apply for the appropriate visa to enter Belarus.

EOR Solutions in Belarus

• Employer of Record (EOR) Solutions for Prospective Employees in Belarus: Mercans provides seamless Employer of Record (EOR) solutions for businesses that have identified their ideal candidates in Belarus. Our services cover every stage of the employee lifecycle, ensuring full compliance with Belarusian labor laws and regulations.
• EOR and Recruitment Services: For companies seeking support in talent acquisition, our combined EOR and recruitment services offer a comprehensive solution. We leverage our extensive network and industry expertise to assist you in finding, onboarding, and retaining top talent, facilitating a smooth entry into the Belarusian market.
• Visa Sponsorship and Global Mobility: Navigating the complexities of expatriate employment is made easier through our visa sponsorship and global mobility services. We manage the relocation of your international workforce while ensuring compliance with Belarusian immigration and employment laws.
• Assistance on Record (AOR) for Contractor Payments: Businesses facing challenges with contractor payments can benefit from our Assistance on Record (AOR) services. We take care of the complexities involved in contractor payments, ensuring accuracy and compliance at every step.
• Transitioning Freelancers to Employees: Mercans facilitates the transition of independent contractors to permanent employees in Belarus. Our expertise ensures that this process is smooth and adheres to all legal requirements.
• HCM Integration: Seamlessly integrate Mercans’ EOR services with your Human Capital Management (HCM) system in Belarus for real-time data exchange, enhanced compliance, and improved cost-efficiency. Rely on our expertise for a unified, compliant, and effective approach to managing your workforce and payroll operations.