European Employment Insights April 2026 (Ukraine)

Upcoming reform of the Ukrainian labor legislation

In January, the Cabinet of Ministers of Ukraine submitted a new draft of a new Labor Code of Ukraine to the Parliament. This is the latest in a series of attempts by the Government to reform the existing legal framework of employment relationships in Ukraine, which it estimates as not corresponding to the current economic environment and modern forms of employment. However, all previous reforms have been abandoned for various reasons.

A radically new approach to the regulation of labor relations

This time, the Government expects to completely liberalize and modernize labor relationships by canceling the strict regulation thereof through imperative norms and mandatory protection of rights and interests of employees by introducing instead an equality of parties to the employment agreement and a freedom of such agreement. Employers and employees will be free to agree on employment terms, their mutual rights and obligations as they deem relevant without having to adhere to any mandatory rules. From now on, employment relationships will mainly be regulated by written employment agreements, replacing the so-called “oral” employment agreements. If necessary, the parties may, but will not be required to, rely on discretionary provisions of the Labor Code.

The cases in which fixed-term employment relations will be permitted are expanded considerably. Additionally, the procedures for hiring and dismissing employees, changing employment conditions agreed upon will be substantially simplified. Employers will be entitled to terminate any employee based on economic, technological or organizational needs subject to payment of monetary compensation.

The concepts of the disciplinary liability and disciplinary procedure are removed. Employers will be entitled to dismiss an employee upon a second violation of job duties by way of simple documentation of the fact of violation by an act. Although employers shall still be required to request explanations from employees regarding the misconduct, consideration of such explanations will no longer be mandatory. Labor disputes will be permitted to be settled through negotiations (the first mandatory step), mediation or arbitration.

According to the Government, these novelties should introduce balance into relationships between employers and employees and ensure employment stability.

Controversial changes

Guarantees currently provided to certain categories of employees (such as pregnant women, employees with young children, single mothers) will be removed or significantly reduced, which is explained by the necessity to harmonize the Ukrainian legislation with the EU standards on gender equality and to provide more flexibility in relationships with employees with children. The requirement to prior agree with a labor collective representative certain material employment conditions and changes thereto will be replaced with a simple notification about future changes.

The new Labor Code will legalize 48-hour workweek and 12-hour workday, increasing the total duration of overtime to 250 hours per year from the currently permitted maximum of 120 hours per year.

Long-awaited changes

The new Labor Code will include a comprehensive list of characteristics of employment relationships that distinguish them from services provided under civil law agreements by individuals or private entrepreneurs, which form of relationships is more attractive from a tax laws perspective and thus is widely used in Ukraine to substitute employment relationships.

Among the positive changes may also be listed the possibility to enter into the employment agreement in advance and to sign it with either a wet-ink or electronic qualified and advanced signatures, the establishment of clear rules on entering into employment agreements with elected officials of companies, and an increase in the duration of paid annual vacation from 24 to 28 calendar days.

For the first time, the labor laws will incorporate clauses prohibiting breach of the principles of equal rights and opportunities for women and men and equal pay for work of equal value, as well as harassment. Employers will obtain the right to collect information about a candidate’s past employment, monitor corporate emails of employees and use video surveillance. The Labor Code will establish clear guidelines regarding confidentiality and non-disclosure obligations of employees. Finally, the detailed regulation of activities of temporary employment agencies is envisaged.

According to the Government, such new liberalized employment rules will ensure de-shadowing of the labor market and increase tax revenues.