Labour Regulation

Fixed-term contract

Fixed-term contract will be deemed to be extended for the same period unless terminated by a notice within 7 days of the expiration of the original term of the contract.

Temporary Employment

A contract without a fixed term can be terminated by employer only in cases specified in the Labour Code such as gross violation of labour duties by an employee, redundancies, determination by a competency assessment body of an employee's qualification as inadequate for performance of his/her duties, change of labour conditions etc.

Termination of Employment

An employer is under a duty to give a termination notice. The general term of such a notice is 2 months (e.g. redundancies). However, certain exceptions apply (e.g. in case of gross violation of labour duties when no notice is required). An employee can terminate a contract at any time upon giving a 1-month notice.

Dismissal

Grounds for dismissal include, among other things: staff redundancy; employee's failure to meet required competency standards as determined by the decision of a competency assessment body; liquidation of an enterprise; and violation of employment duties as determined by the employment contract or labour law.

Social insurance

Generally, legal entities are required to make monthly social insurance contributions in the amount of 22% of the salary fund of its employees. Legal entities are also under an obligation to withhold employees' social insurance contribution in the amount of 3% of employees' gross salaries and transfer same on behalf of the employees to the State Social Protection Fund.

Individual entrepreneurs are, generally, required to pay social insurance contributions in the amount of 20% of the minimum salary. Different rates are provided for certain regions and categories of individual entrepreneurs (such as auditors, private notaries, accountants etc.).

Probationary Period

A probationary period of up to 3 months is allowed in most cases and, if the probationary period is included in the employment contract, the contract may be terminated by either party upon giving a 3-day notice. To be enforceable, a probationary period must be stated in an employment contract and may not exceed three months.

Work Week

The regular work week is 40 hours, reduced for certain groups of people and workplaces.

Holidays

There are 21 public holidays. Employees are entitled to 19 official public days off, 18 of which are public holidays and one is a day of mourning, 3 public holidays are working-days.

Sick Leave

Except for the first 14 days of any absence, compensation for sick leave is provided by the State Social Protection Fund, not the employer.

Cost of Employment

Employers are required to pay social security contributions on behalf of their employees.

Fore more information please see our "Doing Business in Azerbaijan" publication