Minimum Wage in Ukraine - Frequently Asked Questions

Is there a separate legislation relating to minimum wages in Ukraine?

No. But minimum wage in the Ukraine is regulated by art. 95 of the Labour Law Code and art. 3 of the Law on payment accepted 24.03.1995 № 108/95-ВР. According to these articles, minimum wage in the Ukraine is a legally set amount of wage for simple, unqualified labour which is the lowest possible rate of payment to workers for monthly and/or hourly norm of labour (volume of work). According to the Law of the Ukraine "On State Budget of the Ukraine for 2016" 25.12.2015 № 928-VIII the monthly minimum wage in the Ukraine is since January 1, 2016 - 1 378 UAH, since May 1, 2016 - 1450 UAH, since December 1, 2016 - 1550 UAH; hourly – since January 1, 2016 - 8,29 UAH, since May 1, 2016 - 8,69 UAH, since December 1, 2016 - 9,29 UAH.

Do one or more minimum wages exist that is/are determined by law?

Only one at the national level. Minimum wage is set up by the Supreme Rada of the Ukraine not seldom than once a year in accordance with the Budgetary Code of the Ukraine. According to the Law of the Ukraine "On State Budget of the Ukraine for 2016" 25.12.2015 № 928-VIII, in 2016 the minimum wage in the Ukraine will be changed three times a year: on January 1, 2016, May 1, 2016, December 1, 2016.

On what basis is minimum wage calculated?

Minimum wage in Ukraine is calculated on a monthly or hourly basis and can’t be less than poverty line for working citizens. Additional payments for overtime work, work in harmful, especially hazardous conditions, in special nature geographical conditions and with increased health risks, as well as bonuses to anniversaries, for inventions and rationalization proposals, other financial aid are not included in the minimum wage. According to Art. 92 of the Ukrainian Labour Code minimum wage is a subject to indexation taking into account inflation rate.

In case of weekly/monthly minimum age, are they based on any fixed number of hours?

Yes, minimum wage is calculated for work in normal conditions with fulfilment of the set (monthly or hourly) work norm. According to art. 50 of the Ukrainian Labour Code the full time work can’t exceed 40 hours per week. According to art 90 of the Labour Code under piece-rate system billing rates are defined on the basis of the set job classes, tariff rates (wages) and output norms (time norms). Piece-rate is calculated by dividing hourly (daily) tariff rate, corresponding to the class of work performed, by hourly (daily) norm of output or by multiplying hourly (daily) tariff rate corresponding to the class of the work performed, by the set time norm in hours or days.

Are governmental bodies, employer and/or trade union representatives involved in minimum wages setting?

Yes. According to art. 10 of the Ukrainian Law on Payment the size of minimum wage in the Ukraine is setup by the Supreme Rada of Ukraine considering recommendations worked out during the negotiations between the representatives of trade unions, owners or authorized bodies, which united for holding collective bargaining and signing a general contract.

How are upratings (adjustments) of minimum wage decided upon?

Minimum wage is set up by the Supreme Rada of the Ukraine not seldom than once a year in accordance with the Budgetary Code of the Ukraine. According to the Law of the Ukraine "On State Budget of the Ukraine for 2016" 25.12.2015 № 928-VIII, in 2016 the minimum wage in the Ukraine will be changed three times a year: on January 1, 2016; May 1, 2016; December 1, 2016.

What is/are the yardstick/s on which minimum wage upratings are based?

"There are the following yardsticks on which the minimum wage size in the Ukraine is based on: • The needs of workers and their families • The cost of a certain food basket, necessary for providing normal functioning of able-bodied person’s organism, supporting his health. • Minimal set of non-food products and minimal set of services, required to meet basic social and cultural needs of an individual. • The overall level of average wages, productivity and employment."

What is the national poverty line? (In national currency)

Since January 1, 2016 the poverty line in the Ukraine is 1330 UAH, since May 1, 2016 - 1399 UAH, December 1, 2016 - 1496 UAH.

How often is poverty line updated?

The poverty line is updated yearly by the Ukraine Supreme Rada according to the Law on the State budget of the Ukraine for a coming year. In 2016 the poverty line will be changed three times: on January 1, 2016, May 1, 2016, December 1, 2016.

When was poverty line last updated? (Specify YYYY/MM)

Poverty line was last updated on January 2016.

How is minimum wages compliance regulated?

"Minimum wage compliance is regulated by: • The Ministry of Labour of Ukraine and its bodies • Financial bodies • State Tax inspection bodies • Trade unions and other bodies (organizations) representing the interests of employees. Prosecutor General exercises supreme control over the remuneration of labour legislation."

Which legal sanctions can be applied in compliance is lacking?

According to part 2 of art 175 of the Criminal Code of the Ukraine the breaching of the order and terms of wage payment are punished by the fine in amount from 100 up to 300 non-taxable minimums of citizens’ incomes. According to art. 265 of Labour Code of the Ukraine legal and physical entities guilty of violation of labour legislation are subjects to disciplinary, administrative, criminal and other type of punishment according to the law.

Are sanctions often being applied?

"There is no precise statistics on applying sanctions for non-compliance with the legislation on minimum wage. Since January to April 2011 Kiev tax inspectors conducted about 177 inspections of the capital’s employers in order to check the compliance with the labour legislation. As the result 12500 employers raised wages to employees and paid to the budget extra 29 mln. UAH. Materials on 6600 enterprises were submitted to prosecutor’s office. http://finforum.org/page/state/news/_/economics/zarplata-v-quotkonvertahquot-chto-bylo-i-chto-budet-r10796"

Are employer and/or trade union representatives involved in compliance procedures?

No, because the minimum wage is regulated and set by the government. Trade unions can only maintain public control over the observance of labour and labour protection legislation, creation of safe and friendly work environment.

To whom/Where can individuals complain, if they think they are earning less than minimum wage?

If the worker is paid less the minimum wage he can file a complaint to the company’s trade union or state labour inspection. Another possibility is to apply for explanations to the company’s management or accountant (preferably in written form). According to art. 49 of the Labour Code of Ukraine, the management has to provide the worker with the written information on the amount of his wage, qualification, specialty and position, to ground its answer with the references to the existing regulations and legislation. If the employer refuses to give the worker such information it is necessary to apply to court.

Which month of the year is minimum wage rate revised in Ukraine?

According to the Law of the Ukraine "On State Budget of the Ukraine for 2016" 25.12.2015 № 928-VIII the minimum wage in the Ukraine will be changed three times: on January, May, December.