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About Alinga | |
 05.09.10Hiring Foreign Employees
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|
Foreign Citizen’s Status |
Employer Permit to Hire Foreign Workers |
Employee Work Permit | |
| Temporarily Staying | With Visa | Required | Required |
| Without Visa |
-- |
Required | |
| Temporarily Living | With Visa |
-- |
Required |
| Without Visa |
-- |
Required | |
| Permanently Residing |
-- |
-- | |
| Highly-qualified Specialist |
-- |
Required | |
- Notification on employment of foreign citizens
The process of hiring a foreigner permanently residing in Russia is the same as for hiring Russian citizens. The regulatory agencies need to be notified when the foreigner is hired, but it is not necessary to inform them if the foreigner is dismissed.
The employer is required to send notifications when they hire foreign employees who are temporarily staying or temporarily living in Russia.
The basic documents establishing the procedure of notifying the regulatory agencies about hiring foreigners are:
- Federal Law #109-FZ “On Migration Registration for Foreign Citizens and Stateless Persons in Russia” dated 07.18.2006 (heretofore referred to as Law #109-FZ);
- Russian Government Ordinance #9 “On Procedures for Migration Registration for Foreign Citizens and Stateless Persons in Russia” dated 01.15.2007 (heretofore referred to as Ordinance #9);
- Russian Government Ordinance #681 “On Procedures for Issuing Approvals for Foreign Citizens to Temporarily Work in Russia” dated11.15.2006 (heretofore referred to as Ordinance #681);
- Federal Law #115-FZ “On the Legal Status of Foreign Citizens in Russia” dated 07.25.2002 (heretofore referred to as Law #115-FZ).
- Federal Migration Service Order #147 “On Forms and Procedures of Notifying the Federal Migration Service about Foreign Citizens Working in Russia” dated 06.28.2010 and registered with the Ministry of Justice on 07.30.2010 (heretofore referred to as FMS Order #147).
Instances where it is necessary to notify the regulatory agencies are outlined below:
|
Grounds for Notification |
Foreigner's Status |
FMS |
Labor Office |
FTS |
Labor Inspectorate |
| Signing employment or civil contracts with foreign employees | With visa |
-- |
On form specified by MPHSD Order # 670/421 from Oct 26, 2007 within one month | On form specified by FTS Letter # GI-6-04-676@ from Aug 24, 2007 within 10 business days | On form specified by MPHSD Order # 610n from Oct 30, 2008 within one month |
| Without visa | On form specified by FMS Order # 147 (after Government Ordinance # 183 from Mar 18, 2008 went out of effect) within 3 business days counting the day the contract was signed |
-- | |||
| Terminating employment or civil contracts | With visa |
-- |
-- |
-- | |
| Without visa | On form specified by FMS Order # 147 within 3 business days |
-- |
-- | ||
| Granting unpaid vacation of more than 30 consecutive days in one year | With visa |
-- |
-- |
-- | |
| Without visa | On form specified by FMS Order # 147 within 3 business days |
-- |
-- | ||
| Application to issue an entry invitation to a foreigner | With visa |
-- |
-- |
On form specified by FTS Letter # GI-6-04-676@ from Aug 24, 2007 within 10 business days |
-- |
| Without visa |
-- |
-- |
-- | ||
| The foreign citizen's arrival to the workplace or to their place of residence | With visa |
-- |
-- |
-- | |
| Without visa |
-- |
-- |
-- | ||
| Foreign citizen receives a work permit | With visa |
-- |
-- |
-- | |
| Without visa |
-- |
-- |
-- | ||
| Foreigner leaves their place of temporary residence (if the employer is the inviting party) | With visa | Second half of notification form on arrival with indication of date foreigner left within 2 days |
-- |
-- |
-- |
| Without visa |
-- |
-- |
-- | ||
| Reporting the foreign worker's place of remporary residence (if the employer is the inviting party) | With visa | On form specified by Government Ordinance # 9 from Jan 15, 2007 within 3 business days |
-- |
-- |
-- |
| Without visa |
-- |
-- |
-- | ||
| The foreign employee violates the conditions of the employment contract | With visa | In any form within 3 business days |
-- |
-- |
-- |
| Without visa |
-- |
-- |
-- | ||
| Premature terminations of the contract | With visa | In any form within 3 business days |
-- |
-- |
-- |
| Without visa |
-- |
-- |
-- | ||
| Foreign employee willfully leaves place of work or residence | With visa | In any form within 3 business days |
-- |
-- |
-- |
| Without visa |
-- |
-- |
-- | ||
| Suspension or annulment of employer's permit to hire foreign workers | With visa |
-- |
-- |
On form specified by FTS Letter # GI-6-04-676@ from Aug 24, 2007 within 10 business days |
-- |
| Without visa |
-- |
-- |
-- | ||
| Annulment of the foreign citizen's work permit | With visa |
-- |
-- |
On form specified by FTS Letter # GI-6-04-676@ from Aug 24, 2007 within 10 business days |
-- |
| Without visa |
-- |
-- |
-- | ||
It is also necessary to voluntarily notify Russia’s Federal Security Service within three business days about a foreign worker who has left their place of work or residence of their own accord (Article 18, Point 8 of Law #115-FZ, Point 17 of Government Ordinance #681 from 11.15.2006).
- Retirement benefits and medical insurance for foreign citizens
Under the authority of Article 7 of the Federal Law #167-FZ “On Mandatory Pension Insurance in Russia,” dated 12.15.2001, if an employer hires a foreign citizen who is either temporarily or permanently residing in Russia and that foreigner does not have a state pension insurance certificate, then the employer must arrange one for them.
Given that contributions to Russia’s Social Insurance Fund (SIF) for insurance for temporary disability or maternity leave are not paid for foreign citizens temporarily staying in Russia, the employer does not have the right to pay SIF benefits out to them, even if the employee has a medical sick leave certificate. It is not necessary to process mandatory medical insurance policies for foreign citizens temporarily staying in Russia, since the employer is not considered their insurance plan sponsor. It is only necessary to draw up mandatory medical insurance policies for foreigners temporarily living in Russia.
Foreigners permanently residing in Russia receive their medical insurance policies according to their place of residence.
- Employment of foreigners temporarily staying or temporarily living in Russia
It is important to note that foreigners temporarily staying or living in Russia have the right to do so only within the specific area that they have been allowed to temporarily reside.
There are exceptions when foreigners are sometimes allowed to work outside of the designated area within Russia that their work permits specify. Such exceptions are established by Government Ordinance #97 “On Instances Where Foreign Citizens or Stateless Persons Temporarily Staying or Living in Russia are Allowed to Work Outside of the Area Designated on their Work Permit or Temporary Residence Permit,” dated 02.17.2007 (heretofore referred to as Ordinance # 97).
There are two exceptions:
- Going on official business trips;
- If the employee’s regular work involves traveling or the type of work performed is of an itinerant nature. A list of such professions and types of work is in accordance with Government Ordinance #97 and is affirmed by Ministry of Public Health and Social Development, dated 09.17.2007.
Limits have also been established for foreigners’ duration of stay outside of the area within Russia that is issued to them on their work permit:
|
Foreigner’s Status |
Maximum Time Period | |
|
Business Trip |
Field Work | |
| Temporarily Staying |
10 consecutive days* |
60 consecutive days* Point 1, Sub-point 6 of Ordinance #97 |
| Temporarily Living | 40 consecutive days in one calendar year Point 2, Sub-point a of Ordinance #97 |
90 consecutive days in one calendar year Point 2, Sub-point 6 of Ordinance #97 |
* within the time period that the foreigner’s work permit allows
- Work performed by highly-qualified foreign specialists
Federal Law #86-FZ, dated 05.19.2010, came into force July 1, 2010 and introduced changes to Law #115-FZ. One of these changes was the addition of a new category of foreign workers – highly-qualified specialists.
A highly-qualified specialist is defined as someone who has work experience, skills or achievements in a specific sphere of business and who will be earning a salary of 2 million rubles per year or more as a condition of their employment in Russia. Employers independently evaluate the competence and qualifications of the foreign citizen that they wish to hire as a highly-qualified specialist.
Employers will also submit all necessary documents for the specialist’s work permit and for their invitation to enter Russia to the federal executive body in charge of migration issues.
Quotas on invitations for foreign citizens to work in Russia and on work permits for foreigners do not apply to highly-qualified specialists.
Work permits may be given to highly-qualified specialists for a time period corresponding to their employment or civil work contract but not for a term of more than three years. The specified time period on the work permit may be extended more than once to correspond with the time period indicated by the employment or civil contract, but not for a period of more than three years each time. If, in accordance with the contract, the specialist performs their work duties in two or more regions within Russia, this specialist will be issued a work permit that is good for all of those regions.
Highly-qualified specialists are subject to a 13% personal income tax effective from the date they begin work in Russia.
Employers and contractors are required to notify the Federal Migration Service (FMS) quarterly that they have paid the obligated salary to their highly-qualified specialists in accordance with their employment contracts. Employers are also required to report annulment of employment or civil contracts with specialists, as well as any instances where the specialist takes unpaid vacation time of more than 30 consecutive days in one year. Such notifications are submitted in the form specified by FMS Order #147.
The employer is required to submit proof that the specialist has been registered with the Russian tax authorities within 30 days from the day that the specialist receives their work permit.
A standard business visa valid for 30 days may be processed for a foreign citizen; information on this as well as on business visas for highly-qualified specialists can be found on the FMS’s official website. Standard business visas are processed for foreign citizens if they have a written proposal from an employer requesting that they come to Russia to take part in relevant negotiations with said employer.
- Company responsibility for violations of legislation regulating employment of foreigners
The organization may carry administrative responsibility, as specified by Russia’s Administrative Offenses Code, if it is discovered that the federal legislation on employing foreigners has been violated:
|
Type of Violation |
Amount of Administrative Fine |
Administrative Offenses Code (AOC) Article | |
|
For company officials |
For the company | ||
| Inviting party violates conditions of the foreigner’s stay or of the handling of documents on their right to stay | 40,000 – 50,000 rubles | 400,000 – 500,000 rubles | Article 18.9, Part 1 |
| Inviting party fails to fulfill their obligations with regards to migration registration | Article 18.9, Part 4 | ||
| Failure to submit or late filing of documents or information about foreign citizens or stateless persons as established by law and as requested by the FMS | Article 18.11, Part 2 | ||
| Hiring a foreign citizen or stateless person for work in Russia without obtaining a work permit | 25,000 – 50,000 rubles | 250,000 – 800,000 rubles or suspension of business activity for up to 90 days | Article 18.15, Part 1 |
| Hiring a foreign citizen or stateless person for work in Russia without a permit to hire and employ foreign workers | Article 18.15, Part 2 | ||
| Failure to inform the FMS, tax authorities, or labor office about hiring a foreign citizen or stateless person for employment in Russia | Article 18.15, Part 3 | ||
In the event that two or more foreign citizens or stateless persons are hired to work in Russia, the administrative responsibility established in Article 18.15 of the Administrative Offenses Code treats each unlawful hiring as a separate offense. The company may be prosecuted within a year from the time that the violation was committed (Article 4.5 of the Administrative Offenses Code).
Conclusion
As we’ve seen, there are quite a few restrictions on hiring foreign employees in Russia.
Companies that decide to hire foreigners should be aware that foreigners usually turn to companies that specialize in processing all these necessary documents for work permits, etc. for a fee. In many cases, such companies disregard the lawful methods of obtaining the necessary documents for the foreigner to work in Russia. As a result, the foreigner may be getting a falsified or invalid work permit. In order to protect their company from any potential problems from the regulatory authorities, employers can verify the authenticity of foreigners’ work permits themselves with the help of the FMS’s website. On the site, the employer must enter the particulars of the document and provide an e-mail address that the results will be sent to.
Alinga Consulting Group provides the following services with respect to hiring foreign citizens:
- Processing permits to hire and employ foreign workers and work permits.
- Notifying government agencies about employment agreements with foreign citizens.
- Personal accreditation of foreign employees of affiliates and representative offices of foreign companies.
- Visa support for foreign citizens who have received work permits.
- Migration registration and deregistration.
Alinga specialists who will be able to assist you in these matters:
Leonid Romanov
Senior Lawyer
+7 495 988 21 91, ext. 147
Ekaterina Neretina
Lawyer
+7 495 988 21 91, ext. 145
Audit and Taxation Legal Accounting and Payroll
Questions? Ask Alinga's Experts!
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