Employer of Record Guide in Uzbekistan
Uzbekistan's growing economy and skilled workforce present exciting opportunities for global expansion, but navigating local employment laws requires careful attention to detail. Our comprehensive guide helps you hire compliantly while tapping into this emerging market's potential.
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Key stats and facts
With a GDP per capita of $3,037 and major economic centers like Tashkent and Samarkand, Uzbekistan offers access to in-demand skills from sales consultants to call center operators. Understanding the local market dynamics and 12% tax structure is essential for successful expansion.
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Your EOR guide in Uzbekistan
From minimum wage requirements to complex leave policies, Uzbekistan's employment framework has specific nuances that can impact your hiring strategy. This detailed breakdown covers everything from payroll cycles to onboarding requirements, ensuring you stay compliant while building your team.
Minimum Wage
The minimum wage in Uzbekistan is 1,271,000 UZS per month as of 2025. This represents an increase from the previous rate of 1,155,000 UZS and applies universally across all sectors without different rates for youth, tipped workers, or other categories.
Note: Please verify the exact effective date - sources indicate either January 1, 2025 or August 1, 2025.
Payroll Cycle
- Standard Practice: Monthly payments are most common
- Legal Requirement: Payments must be made at least twice monthly with no more than 16 days between payments
- Typical Payment Date: Last working day of the month
Individual Income Tax
Uzbekistan applies a flat 12% personal income tax rate for both residents and non-residents on Uzbekistan-sourced income.
Tax Deductions:
- 1.5 times minimum wage monthly exemption
- Mandatory social contributions
Special Regime for Foreign Citizens: Foreign nationals can pay a USD 50,000 fee to exempt foreign-sourced income from taxation.
Tax Residency Criteria
Primary Test: 183 days or more physical presence in any consecutive 12-month period Secondary Test: Present in Uzbekistan for less than 183 days but more than in any other state
Tax Implications:
- Residents: Taxed on worldwide income
- Non-residents: Only on Uzbekistan-sourced income
Employer Payroll Contributions
| Contribution Type | Standard Rate | Special Sectors |
|---|---|---|
| Social Tax | 12% | Budget organisations: 25% |
| Pension Contribution | 0.1% | Some sectors: As low as 1% |
| Total Employer Cost | ~12.1-12.6% | Varies by sector |
Working Hours
Standard Work Week: 40 hours
- Five-day week: 8 hours per day
- Six-day week: 7 hours per day
Reduced Hours: Apply to employees under 18 and those in hazardous conditions
Overtime Pay
Note: Sources show conflicting information - please verify current overtime regulations.
Potential Rates:
- 150% for first 2 hours, 200% for subsequent hours (with annual cap abolished), OR
- Flat 200% rate with 120-hour annual cap
Alternative: Time-off in lieu available at employee's request
Bonus Payments
No mandatory 13th-month bonus or other statutory bonuses are required. Performance-based bonuses are discretionary and widely used in practice.
Full-Time vs Part-Time
The Labour Code does not define specific hourly thresholds for classification. Part-time employees are entitled to the same rights as full-time employees on a pro-rata basis.
Vacation Leave
- Minimum Entitlement: 15 working days paid annual leave
- Enhanced Entitlement: 30 calendar days for employees with disabilities and those under 18
- Accrual: After six months of continuous employment
- Calculation: Sundays excluded from vacation pay calculation (February 2025 amendment)
- Termination Payout: Unused vacation must be compensated
Sick Leave
- Duration: No specified maximum; typically at least 30 days funded by social security
- Compensation:
- 60%-80% of average salary depending on service length
- 100% compensation for work-related injuries/illnesses
- Documentation: Medical certificate required
Maternity Leave
- Duration: 126 calendar days total (70 days before birth, 56 days after)
- Extensions: Available for complicated births or multiple births
- Compensation: 100% of average salary
- Funding: Social insurance system
- Job Protection: Termination due to pregnancy explicitly prohibited
Parental Leave
- Paternity Leave: Draft law proposing 5 days paid leave (pending enactment)
- Childcare Leave: Available until child reaches age 2, with state-determined compensation
- Disability Support: Additional monthly paid day off for parents of disabled children under 16
Bereavement Leave
No specific statutory duration is mandated by law. Short periods of paid or unpaid leave are typically granted based on company policy.
Personal & Family Leave
- Unpaid Leave: Subject to employer approval
- Duration Limit: Maximum 3 months within any 12-month period (February 2025 amendment)
Summary
| Leave Type | Duration | Paid? | Funding |
|---|---|---|---|
| Vacation | 15 working days/year | Yes | Employer |
| Sick Leave | 30+ days typical | 60-100% | Social Security |
| Maternity Leave | 126 calendar days | 100% | Social Insurance |
| Paternity Leave | 5 days (proposed) | Yes | Pending legislation |
| Childcare Leave | Until age 2 | Partial | State |
| Bereavement | Company policy | Varies | Employer |
Termination Types
Termination With Cause:
- Systematic duty violations
- Gross misconduct
- Theft or intoxication
- Unsuitability for position
Termination Without Cause:
- "At-will" termination not permitted
- Only allowed for redundancy, liquidation, or organisational changes
Constructive Dismissal:
- Recognised under law
- Employees can terminate for employer's labour law violations
Notice Period Requirements
| Termination Reason | Notice Period |
|---|---|
| Redundancy/Liquidation | 2 months (60 days) |
| Insufficient Qualifications/Health | 2 weeks (14 days) |
| Misconduct | 3 days |
| Employee-Initiated | 2 weeks written notice |
Pay in Lieu: Available by mutual agreement
Severance Pay
Mandatory for redundancy; not required for misconduct terminations.
Calculation Based on Service Length:
- Up to 3 years: 50% of monthly salary
- 3-5 years: 75%
- 5-10 years: 100%
- 10-15 years: 150%
- Over 15 years: 200%
Note: Alternative calculation method mentioned as "one month's salary for every two years of service" - please verify current regulations.
Probationary Periods
- Standard Length: 3 months (90 days)
- Senior Roles: Up to 6 months (180 days) for managers and chief accountants
- Termination: Either party can terminate with 3 days' written notice
Final Pay Requirements
All payments must be made on the last day of employment, including:
- Outstanding wages
- Unused vacation compensation
- Severance if applicable
Termination Documents & Process
- Documentation: Formal written termination order required
- Record Keeping: Electronic employment records must be updated in the Unified National Labour System
- Union Consultation: Required if employee is a union member
Anti-Discrimination & Retaliation Laws
Protected Characteristics:
- Gender, age, race, nationality
- Language, social origin, property status
- Religion, beliefs, union membership
Recent Enhancement: February 2025 law explicitly prohibits dismissal for pregnancy or having children.
National Holidays (2025)
| Holiday | Date |
|---|---|
| New Year's Day | January 1 |
| New Year Holiday | January 2 |
| International Women's Day | March 8 |
| Women's Day Substitute | March 10 |
| Nowruz (Spring Festival) | March 21 |
| Eid al-Fitr | March 31 (tentative) |
| Day of Remembrance and Honour | May 9 |
| Eid al-Adha | June 7 (tentative) |
| Independence Day | September 1 |
| Teacher's and Mentor's Day | October 1 |
| Constitution Day | December 8 |
Regional Holidays
No officially mandated regional holidays exist. All holidays are observed nationwide.
Holiday Pay Eligibility & Working on a Holiday
Compensation: Double pay (200%) for holiday work Alternative: Time off in lieu at employee's request with standard pay rate
Required Documents for Employment
- Employment Contracts: Written contracts mandatory (physical or electronic)
- Digital Registration: Must be registered in "Unified National Labour System" (my.mehnat.uz)
- Streamlined Process: February 2025 law eliminated requirement for physical passport, labour book, or pension certificate copies
- Foreign Workers: Work permit and work visa required
Language Requirements
- Official Language: Uzbek
- Business Languages: Russian widely used; English increasingly common in IT sector
- Contract Language: Contracts should be in Uzbek or Russian for legal validity
Background Checks & References
- Permitted Scope: Professional and educational qualifications, job-related medical examinations
- Consent Requirement: Explicit written consent required for personal data processing
Data Protection & Privacy
Governed by the "Law on Personal Data":
- Employees have the right to know what data is collected and its purpose
- Explicit consent required for data processing
- Clear policies required for data handling, especially for remote workers
IP Assignment & Confidentiality
- Default Ownership: Employer owns IP created as part of job duties ("service work")
- Contract Clauses: Explicit IP assignment clauses strongly recommended
- Non-Compete: Not specifically regulated; enforceability questionable
Probation Period Setup
Most contracts include a probationary period of up to 3 months (6 months for senior roles). Either party can terminate with 3 days' written notice during probation.
Onboarding Timeline
The process can be completed within a few working days using digital systems. The key step is timely registration on the my.mehnat.uz platform.
What the EOR Handles
Borderless AI will handle:
- Employment contracts in appropriate language
- Registration in the Unified National Labour System
- Local tax and social security compliance
- Document collection and filing
- Payroll setup and processing
Worker Classification: Employee vs Contractor
Employee Criteria:
- Specific labour function
- Subordination to employer rules
- Labour Code protections apply
Contractor Criteria:
- Specific measurable result/service delivery
- Not part of company staff
- No subordination to internal schedule
Misclassification Penalties: Significant penalties including back social taxes, fines, and obligation to provide employee benefits.
Unionisation & Collective Agreements
- Right to Unionise: Protected by Constitution and Law on Trade Unions
- Collective Bargaining: Can establish conditions exceeding Labour Code minimums
- Employer Obligations: May require union consultation for certain decisions
Cultural Norms & DEI Expectations
Work-Life Balance: 40-hour work week legally mandated; cultural flexibility on punctuality varies by organisation.
Communication Style: Generally polite and potentially indirect; relationship-building is important for business success.
Hierarchy: Traditional hierarchical structures remain common, especially in established sectors.
Gender Equality: Government actively promoting equality; women now allowed in previously restricted professions.
Remote Work Considerations
Remote work must be formalised in the employment contract. Key requirements include:
- Employer Obligations: Provide necessary equipment, ensure compliance with social security and tax obligations
- Equal Rights: Remote employees entitled to same protections as office-based employees
- Data Security: Clear policies required for remote work data handling
Anti-Discrimination Laws
Comprehensive protection covers gender, age, race, nationality, language, social origin, property status, religion, beliefs, and union membership. Court complaints are available for discrimination cases with compensation rights.
Built-in benefits packages for Uzbekistan
When the world is your competition, it pays to incentivize new hires and existing alike. Borderless AI benefits packages typically inlucde:
Medical Insurance
Dental Insurance
Retirement Contribution
Life Insurance
Vision Insurance
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