New rules set for regional work permits, hiring foreign managers

IMPACT – MEDIUM

What is the change? Legal amendments taking effect this month will revise rules for foreign workers applying to work in multiple regions of the country, and remove certain obligations on companies that hire foreign managers and directors.

What does the change mean? Foreign employees will no longer be able to extend a work permit for one region of the country to another region, and must apply for new work permits for each new region; however, the exemption for business trips to a new region will be lengthened to 90 days. Also, companies hiring foreign managers and directors will no longer have to fulfill “special conditions” related to recruitment.

• Implementation time frame: September 2015.
• Visas/permits affected: Work permits.
• Who is affected: Companies hiring foreign employees to work in more than one region of Kazakhstan; companies hiring foreign managers and directors.
• Impact on processing times: Companies will be required to apply for new work permits when moving employees into a new region.
• Business impact: Employers operating in multiple jurisdictions in Kazakhstan will have a greater administrative burden, while employers recruiting managers and directors will face fewer hurdles.

Background: Under the recent changes, a foreign worker must obtain a new work permit for each new region, but is exempt for business trips to the new region lasting no more than 90 days. Foreign workers holding existing work permits approved for two or more regions should be able to use them until they expire. Prior rules permitted companies to apply for an extension of an existing work permit to cover new territory, but allowed a shorter exemption period of 60 days per calendar year.

The authorities are also removing “special conditions” on companies hiring managers and directors (“first category” employees). Special conditions are additional obligations on employers, including requirements for training and hiring of local workers. However, quotas will still apply to this category, limiting managers and directors to 30 percent of a company’s workforce.

BAL Analysis: Companies operating in more than one region of Kazakhstan should plan for the new rules and the additional time for processing new work permits where required. Employers hiring foreign managers and directors will benefit from the elimination of extra recruitment obligations.

This alert has been provided by the BAL Global Practice group and our network provider located in Kazakhstan. For additional information, please contact your BAL attorney.

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