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How to hire foreign employees (simple labor workers or qualified professionals) correctly

The Russian migration legislation divides foreign employees into several categories, each being subject to special employment and hiring regulations.

Permanently residing in Russia

These are foreigners having a residence permit in Russia. This is the least overregulated category in terms of their hiring. They are not required to obtain a work permit or a patent, and their employers are not required to obtain a permit for hire of such foreign employees.

An employer should only meet the relevant general requirements of applicable law and give its local internal affairs office a written notice of hiring a foreign employee within three days upon entering into an employment agreement with such employee. Similarly, a written notice of termination of such employee should be given within three days upon termination of his/her employment agreement.

The above requirements apply to all the categories of foreign employees in Russia. An employer’s failure to meet such requirements in due time is punishable by fines in accordance with Article 18.15, para 3 of the Russian Code of Administrative Offences. Amounts of fines are considerable and may be multiplied by a number of employees to whom their employer’s failure relates. Thus, this offence is punishable by imposition of a fine of up to RUB 800,000 on a legal entity or by administrative suspension of its operations for up to 90 days, and a fine of up to RUB 50,000 may be imposed on its officer. With respect to employers in Moscow, Moscow Region, St. Petersburg and Leningrad Region, increased fines are set: up to RUB 70,000 may be imposed on officers and up to RUB 1 mln on legal entities.

Temporarily residing in Russia

The status of a foreigner temporarily residing in Russia should be evidenced by a relevant permit. Like permanently residing foreign employees, foreigners of this category may work in Russia without special authorizations. Their employers are not required to obtain a permit for hiring such employees.

The key distinction between temporarily residing and permanently residing foreigners is that, generally, the first mentioned category may only be employed in the same constituent of the Russian Federation where they are permitted to reside. When hiring such category of foreign employees it is critical to check what particular constituent of the Russian Federation is named in their temporary residence permits. Failure to meet the above-mentioned requirement may entail imposition of fines on the employer and its officer under Article 18.15, para 1 of the Code of Administrative Offences. Maximum amounts of fines are similar to fines for failure to give notice of hire or termination of foreign employees, as set in Article 18.15, para 3 of the Code of Administrative Offences.

Temporarily staying in Russia

Most of foreigners working in Russia fall under the category of temporarily staying foreign employees. The category is divided into two groups: visa foreign employees, i.e. those requiring a visa to come to Russia, and visaless foreign employees, those who need no visa.

When entering Russia visaless foreigners should indicate “work” as the purpose of their entry, get themselves registered with the local migration office after arrival at their place of living and thereafter obtain a patent required for their employment. A patent is issued in a particular constituent of the Russian Federation for a 1-year term which can be renewed. The patent issuance fee varies by region and is to be paid by the foreigner himself.

An employer hiring a visaless foreign employee should make sure that the employee has a patent required for work in a particular constituent of the Russian Federation. If the document names a specialty, the employee may only be hired for a position fit for such specialty. In addition to documents generally required for hiring, as listed in Article 57 of the Russian Labor Code, an employee should present to his/her employer a voluntary medical insurance policy. Employers are not required to obtain a permit for hire of visaless employees.

A special sub-group of visaless foreigners are foreign employees being citizens of state-members of the Eurasian Economic Union (namely, Armenia, Belarus, Kazakhstan and Kyrgystan), for which preference work conditions are provided: they need no patent for work; the period of their temporary stay in Russia is determined by the term of their employment agreements; and they are afforded a longer timeline for registration with a migration authority.

Hiring of visa foreign employees is most complicated and costly for employers. An employer is required to obtain a permit for hire of foreign labor. The official fee for issuance of such permit is RUB 10,000 per employee. Thereafter the employer will need to apply for issuing an invitation for the employee’s entry to Russia for work, provided that such invitations are issued within the limits of a special quota approved by the Russian Government. Parallel to applying for an invitation, the employer should file documents required for issuance of a work permit for its foreign employee.

Apart from that, the employer will need to submit material, medical and housing guarantees in favor of its foreign employee for the period of his/her stay in Russia and to ensure implementation of such guarantees during the period of stay of the employee in Russia. Failure to meet this requirement will entail imposition of administrative liability on the employer under Article 18.9, para 5 of he Code of Administrative Offences. Upon completion of a foreign employee’s work period, the host party should help its foreign employee to leave Russia or to pay related expenses in case of such employee’s expulsion from Russia.

Highly skilled professionals

This is a different category of foreign employees.

A highly skilled professional is a foreign employee with certain experience and qualification, who is eligible for compensation not less than the minimum amount set by law. Generally, it is RUB 167,000 per month. Lower amounts of compensation are set by law for certain categories of highly skilled professionals (such as scientists, medical or educational professionals or professionals working in special economic zones, etc.).

Employers hiring highly skilled professionals are required to provide the compensation level guaranteed by law and report quarterly thereof to their local internal affairs office. Failure of a company to meet such requirement is punishable by a fine of up to RUB 1 mln under Article 18.15, para 5 of the Russian Code of Administrative Offences. An employer is also required to maintain at its own cost a voluntary medical insurance policy or a medical service agreement with a healthcare organization for the employer’s highly skilled professional and his/her family members. This is an essential condition of such employee’s employment agreement.

To hire a highly skilled employee, the employer is not required to obtain a permit for hire of foreign labor, even if the highly skilled professional is a visa foreign employee. Moreover, invitations for entry to Russia are issued with no regard for the foreign labor quotas. A work permit for a highly skilled professional is issued for the term of his/her employment agreement, but no more than three years, and can be prolonged more than once.

Key guidelines for hiring foreign employees in Russia

1. Define the category of your prospective foreign employee. The category is essential to understand what documents and requirements are applicable to hiring of such employee;

2. Obtain a permit for hire of foreign labor where it is required by law;

3. Check the employee’s documents confirming his/her right to stay and to work in Russia, as well as his/her voluntary medical insurance policy, and enter the details of these documents into this/her employment agreement;

4. Make sure that you give notice of hire or termination of your foreign employee to your local internal affairs office. In case of a highly skilled professional, you should also report quarterly on payment of salaries to such employee.

Important! – Fines for non-compliance with the migration law are substantial, so it is very important for employers to meet the requirements and rules relating to hiring of foreign employees in Russia.