Ukraine: Criteria for reserving employees and obtaining critically important business status have been updated

29 Nov 2024    2 minute read
Workforce Redesign Critically Important Business Reserved Employees Mobilization

In brief

On 1 December 2024, the Resolution of the Cabinet of Ministers of Ukraine "Some Issues of Reservation of Persons Liable for Military Service for the Period of Mobilization and Wartime" No. 1332, dated 22 November 2024 ("Resolution"), will come into force. This Resolution updates the criteria for reservation of employees liable for military service and the criteria for companies to obtain the critically important business status. Additionally, from now on, the reservation needs to be obtained by an electronic submission through the Diia Portal, allowing the results to be received within 72 hours.

Contents

Key changes

  • All companies with the critically important business status are required to reconfirm their status in accordance with the updated criteria by 28 February 2025.
  • At a critically important company, the number of reserved employees cannot exceed 50% of the total number of employees liable for military service. However, this number may be increased by a separate decision of the minister of defense.
  • For the purpose of calculating the quota of employees that may be reserved, among other things, the female employees liable for military service are not considered.
  • For privately owned companies, the salary criterion for obtaining the criticality important business status has been changed: the average salary at the company for the last calendar quarter must be at least 2.5 times the minimum monthly salary (i.e., currently UAH 20,000). Additionally, there must be no arrears in the payment of the Unified Social Tax, as well as of other taxes to the state and municipal budgets.
  • The main method to submit the request for employee reservation is to use the Diia Portal. Submission in paper form is possible only if the company does not have an EDRPOU code or the technical ability to use the Diia Portal. In this case, the company must submit the request through the relevant government agency that has awarded the critically important business status to the company.
  • Each employee included in the list for reservation must be paid a salary in each month of the last reporting period (quarter) not lower than the 2.5 times the minimum monthly salary (i.e., UAH 20,000). Such employees should have also updated their personal military registration data (in accordance with the Law of Ukraine "On Amendments to Certain Legislative Acts of Ukraine on Certain Issues of Military Service, Mobilization and Military Registration" No. 3633-IX of 11 April 2024) and must not be on the wanted list.
  • The activities of the companies that have been granted the criticality important business status will be monitored on a monthly basis to check their continued compliance with the relevant criteria.

Recommendations

The new rules will come into force on 1 December 2024. We recommend that employers consider these changes when submitting lists for determining the company as critically important and reserving employees.

Click here to read the Ukrainian version.

Contact Information
Lina Nemchenko
Partner
Kyiv
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lina.nemchenko@bakermckenzie.com
Mariana Marchuk
Counsel
Kyiv
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mariana.marchuk@bakermckenzie.com

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