Kazakhstan EOR & PEO

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Hire in Kazakhstan

Kazakhstan, a country in Central Asia, is the largest landlocked country in the world, and ninth-largest overall. The country is located strategically between Europe and Asia, which makes it highly conducive for both local and international businesses. With a population of 20 million, its labor force stands at over 9.5 million people as of 2023, with an employment rate of 65.2%.

According to a 2023 sample survey of the employed population, 2.1 million people were self-employed. On the other hand, 6.9 million (which makes up 75.9% of the total employed population) were employed for hire. The survey also showed that the four sectors with the largest share of employees were trade (16.7%), education (13%), industry (12.3%), and agriculture (11.9%). However, like other countries, increasing digitalization means there is a growing demand in Kazakhstan for IT professionals and skills across various industries.

In recent years, Kazakhstan has been more receptive to foreign businesses. Currently, it stands out as a top site for foreign direct investment, accounting for 70% of the FDI inflow to Central Asia. Though employment is relatively high in the country, employers often lament the difficulties of finding workers with the right skills to fill available positions, especially in technical and managerial departments.

In Kazakhstan, many companies, especially international companies with employees in the country, prefer to enlist the services of an Employer of Record (EOR) to handle their general employment functions. This saves them the additional administrative burden of managing their employees.

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hire employees in Kazakhstan

What Is a Kazakhstan EOR?

A Kazakhstan Employer of Record (EOR) is a third-party organization that companies hire to take on the legal and administrative responsibilities of employing workers in Kazakhstan. Through this arrangement, businesses can hire employees in Kazakhstan without having to set up a legal entity in the country. The EOR becomes the official employer of labor. It handles various aspects of employment, such as ensuring compliance with local labor laws and regulations, payroll processing, tax withholding and remittance, employment contracts, benefits administration, etc.

An EOR is a more comprehensive solution to employment-related activities than a payroll outsourcing provider, as the latter specializes strictly in managing a company’s payroll functions. With an EOR, companies do not have to worry about the legal framework of employment in Kazakhstan or how their local employees are hired and compensated for their work. This solution best suits businesses looking to maintain a workforce in Kazakhstan without committing to a full-fledged subsidiary.

An Employer of Record is closely related to a Professional Employer Organization (PEO), and both are often used interchangeably. However, it is important to note that though both provide HR and employment support, they are two distinct services that serve different purposes and operate in different ways. On the one hand, with an EOR, the company has no responsibility towards the employees beyond managing day-to-day work. However, with a PEO, the company becomes a co-employer, retaining some control over employee management. In essence, PEOs are often used by small companies in Kazakhstan wishing to outsource their HR tasks within the country.

Save Money And Time with A Kazakhstan EOR

What Are the Benefits of a Kazakhstan EOR?

There are several important advantages of using an EOR for international businesses looking to hire local talents in Kazakhstan. First and most importantly, hiring a Kazakhstan EOR ensures that companies are compliant with the country’s labor laws when they enlist local labor services. As a matter of specialization, Kazakhstan EORs are well-versed in the labor laws that regulate the activities of labor employers in the country. This makes it possible for them to ensure that all employment practices, contracts, and policies are in line with the law.

Also, with an EOR, a company with workers in Kazakhstan doesn’t have to put in extra effort towards ensuring the proper management of its workers. This is the responsibility of the EOR. They are responsible for employing the workers, handling their payroll, tax withholdings, and benefits, and other general HR matters. This way, the company has little administrative burden to carry and thus can focus on its core business activities.

A Kazakhstan EOR also makes it possible for a company to break into the Kazakhstan market quickly. Without an EOR, an international company looking to hire workers in Kazakhstan will have to first set up a legal entity in the country. This process typically takes a lot of time and effort which the company might not have. However, with an EOR, companies can start hiring immediately.

Horizons is Best IN Class

Why Choose Horizons?

Horizons stands out as a Kazakhstan EOR through:

A strong regional presence in the Asia-Pacific region, meaning senior management are on the ground to deal with any issues.
Client-focused infrastructure. Horizons won’t oversell you on products and services you don’t need. Horizons offers the easiest platform to compliantly hire and pay people worldwide.
Cost-effective solutions. At $499 per employee, per month, no EOR in Kazakhstan is more affordable. The cost is 100% transparent (onboarding, offboarding, deposit, no extra charges).
A customer-first culture. Horizons is an efficient bootstrapped company. It is not an externally-funded company burning investor cash to aggressively acquire new clients. Horizons is the only EOR that grows with its customer, reflecting the level of care and personal attention provided to each customer. Horizons will carefully advise on the best setup in each country: the type of contract needed, how to structure your benefits, and how to offboard a person while minimizing the risk of conflicts and extra cost
A long-term partnership. Horizons is the only EOR platform with a recruitment arm — a direct response to client demand. If any employee is leaving, or if our clients want to explore a new country, Horizons can recruit new candidates directly for the client. Horizons is:
- The only EOR doing this in-house — no subcontracting
- The only EOR doing this without a retainer — clients are only charged upon success
- The only EOR charging just a 2% fee per month.

Step-by-step Kazakhstan EOR

How Does a Kazakhstan EOR Work?

A Kazakhstan Employer of Record takes on the full role of legal employer for a client company’s workers in the country. Throughout the employment relationship between the employee and the company, the EOR serves as the employee’s primary point of contact for any employment-related matter. The EOR performs its role by carrying out several important functions, such as:

Hire Your Employees: An EOR working in Kazakhstan is not responsible for sifting through the country’s labor market to find the local talents that best fit a company’s available roles. However, it is responsible for hiring said talent. The EOR’s job begins as soon as the client company identifies the candidates it wishes to hire in Kazakhstan. Following this, the EOR extends job offers to the candidates and also negotiates employment terms that comply with local labor laws.
Manage Employment Contracts and Onboarding: As soon as a candidate accepts the employment offer, the EOR then drafts an employment contract that complies with Kazakhstan’s labor laws. Though this contract is primarily between the EOR and the employee, it is usually based on the terms agreed upon by the client company. Following this, the EOR begins the process of onboarding the new employee, ensuring that all necessary documentation is completed and filed correctly.
Process Payroll and Handle Employment Taxes: The EOR is also responsible for processing the employee’s payroll per Kazakhstani laws. It calculates the employee’s net income by adding up their base income, benefits, and allowances and subtracting all legal deductibles such as tax withholdings and social insurance contributions. The EOR’s responsible for ensuring that all employees under its hire receive their payments as and when due. It is also the EOR’s responsibility to ensure that all tax and contribution withholdings are remitted to the appropriate government authorities.
Administer Benefits: The Employer of Record also manages the administration of employees’ benefits, as required by Kazakhstani labor laws. These include social security and health insurance. The EOR also handles any additional benefits the client company wishes to offer its employees.
Take Care of Exit Procedures: When an employee resigns or is fired by the company, the EOR is responsible for managing the exit process in compliance with local labor laws. This includes calculating and providing any required severance payment and ensuring that all company property is returned.

stay compliant with Kazakhstan labor laws

Labor Laws

One of the principal reasons for engaging an EOR in Kazakhstan is to ensure full compliance with Kazakhstan’s employment laws. Here we explain in detail how a Kazakhstan EOR ensures:

Compliance with Kazakhstan employment contract requirements.
Compliance with working hours, national holiday provisions, and Kazakhstan social security requirements.

Employment contract types

The Labor Code of the Republic of Kazakhstan (2015) recognizes different types of employment agreements that employers and employees in Kazakhstan can sign. These are indefinite-term contracts, fixed-term contracts, and contracts for specific work or replacement. The most common type of employment agreement is the indefinite term contract, which has no specified end date. On the other hand, the fixed-term contract is usually for a specified period, typically between three months and one year. A contract for specific work or replacement terminates at the end of the specific purpose for which it was created. The purpose could be for a specific task or to replace an employee who’s temporarily absent.

Project-based

Fixed-term

Indefinite

Working hours in Kazakhstan

According to the Kazakhstan Labor Code, workers are expected to work a standard workweek of 40 hours, spread over five days. That means 8 hours per of work from Monday to Friday.

In case of overtime, employees are entitled to 1.5 times their regular hourly rate for each hour of overtime work they do. The maximum daily hours for overtime work is 2 hours. Also, the Labor Code exempts certain types of employees from overtime work. These include employees with disabilities, employees below 18 years old, and pregnant employees.

Overtime must be compensated in the following way:

Holiday Schedule in Kazakhstan [2024]

Kazakhstan has several public holidays on which employees are entitled to be off-duty. These include New Year’s Day (January 1 & 2), Orthodox Christmas (January 7), Nauryz Holiday, Defender’s Day (May 7), Kurban Ait (August 11), and Kazakhstan Independence Day (December 16-17).

Date	Holiday name
7 Jan, 2024	Orthodox Christmas Day
9 Mar, 2024	International Women’s Day
21 Mar – 23 Mar	Nauryz
1 May, 2024	Unity Day
7 May, 2024	Defender of the Fatherland Day
9 May, 2024	Victory Day
6 Jun, 2024	Kurban Ait
7 Jul, 2024	Muharram
6 Jul, 2024	Day of the Capital
30 Aug., 2024	Constitution Day
25 Oct, 2024	Republic Day
16 Dec, 2024	Independence Day

Paid time off

Employees in Kazakhstan are entitled to periods of paid leave. These include sick leave and annual leave.

Sick leave in Kazakhstan

According to the country’s labor laws, employees are entitled to a paid sick leave of 3 days per year. In case of severe illness, this can be extended to 6 days.

Less than 6 months of sick leave:

(percentage of regular wages owed to the employee)

Over 6 months of sick leave

In order for employees to receive the full wages due to them, workers must present a valid medical certificate from a certified doctor to their employer.

Maternity leave in Kazakhstan

Female employees are entitled to 126 calendar days of maternity leave. This includes 70 days before the expected date of delivery and 56 days after childbirth. Maternity leave is generally paid. The compensation is provided by the Social Insurance Fund, covering a percentage of the employee’s average earnings.

The standard duration of paternity leave in Kazakhstan is typically 5 calendar days.

Annual leave in Kazakhstan

The Kazakhstan Labor Code stipulates a minimum of 24 days of paid leave for employees each year. Certain categories of workers, such as workers with disabilities, may be entitled to additional leave.

Termination & severance in Kazakhstan

Before terminating a worker’s employment, an employer must provide valid reasons for the decision. These can include a mutual agreement between employee and employer, the end of the contract term, or circumstances beyond the control of both employer and employee. However, once the decision has been activated, the employer is required to pay a severance fee, applicable to certain situations. These situations include company liquidation or staff reduction. The fee is typically one month’s salary or more.

Kazakhstan's compulsory social security contributions

Social security contributions are part of the country’s social insurance system, designed to provide financial support and benefits in various circumstances such as illness, maternity, disability, and retirement.

Kazakhstan social security for foreigners

Foreign employees benefit from the same social security protections as local employees, including pensions, sickness benefits, maternity leave, and medical coverage.

Individual income tax

Kazakhstan uses a 10% flat tax rate on personal income. This rate applies to most types of income, including wages, salaries, bonuses, and other earnings.

Individuals who spend more than 183 days in Kazakhstan within a calendar year are considered tax residents and are subject to Kazakhstan’s tax regulations on their worldwide income.

Health insurance

Kazakhstan introduced Mandatory Social Health Insurance (MSHI) starting from January 1, 2020. MSHI provides coverage for a wide range of medical services, including primary care, emergency services, inpatient and outpatient treatments, surgeries, and preventive care.

In addition to MSHI, individuals and employers can opt for additional voluntary health insurance to cover services beyond the mandatory scheme. This can include more comprehensive coverage, private hospital rooms, elective procedures, and other non-essential services.

hassle-free Kazakhstani compensation & benefits

Compensation & Benefits

Kazakhstan compensation laws

There is a minimum wage of 85,000 Kazakhstan Tenge, which no employee must earn below. This does not include overtime or holiday pay. If an employee has to work on a public holiday or rest day, they must be compensated at least double the regular rate.

13 month salary in Kazakhstan

Companies with employees in Kazakhstan are not required to pay their workers a 13th-month salary, unlike in some countries. However, a company may choose to do this, as an additional benefit to attract and retain employees.

Social security for Kazakhstani nationals

According to Kazakhstani labor laws, both employers and employees are required to contribute to the Social Security Fund, which covers pensions, social insurance, and health insurance. The employer must contribute 9.5% and 3.5% of the employee’s gross salary to the social tax and social insurance funds, respectively. At the same time, the employee is expected to contribute 10% of their salary as Individual Income Tax.

Kazakhstan Employer Of Record Peo

Navigation

Hire in Kazakhstan

What Is a Kazakhstan EOR?

What Are the Benefits of a Kazakhstan EOR?

Why Choose Horizons?

How Does a Kazakhstan EOR Work?

Labor Laws

Employment contract types

Working hours in Kazakhstan

Compensation & Benefits

Frequently asked questions

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Frequently asked questions

How does an EOR in Kazakhstan ensure compliance with local labor laws?

An EOR in Kazakhstan ensures compliance with local labor laws by staying up-to-date with changing labor regulations and drafting all employment contracts in line with such regulations. Also, it manages payrolls and other employment-related activities per local labor laws.

What are the benefits of using an EOR for hiring in Kazakhstan?

The key benefits of using an EOR for hiring in Kazakhstan for a company include compliance with local labor laws and reduced administrative burden, amongst others.

Kazakhstan EOR & PEO

Start hiring in Kazakhstan

Simple, compliant hiring with Horizons EOR & PEO

Hire in Kazakhstan

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hire employees in Kazakhstan

What Is a Kazakhstan EOR?

Save Money And Time with A Kazakhstan EOR

What Are the Benefits of a Kazakhstan EOR?

Horizons is Best IN Class

Why Choose Horizons?

Step-by-step Kazakhstan EOR

How Does a Kazakhstan EOR Work?

stay compliant with Kazakhstan labor laws

Labor Laws

Employment contract types

Project-based

Probationary period

Termination

Severance

Fixed-term

Probationary period

Termination notice period

Severance

Indefinite

Probationary period

Termination notice period

Severance

Working hours in Kazakhstan

Overtime must be compensated in the following way:

For a regular workday:

For a rest day:

For a statutory holiday:

Paid time off

Under 1 year of employment

1-10 years of employment

10-20 years of employment

20+ years of employment

Sick leave in Kazakhstan

Less than 6 months of sick leave:

Under 1 year of employment

1-10 years of employment

10-20 years of employment

20+ years of employment

Over 6 months of sick leave

Under 1 year of employment

1-3 years of employment

3+ years of employment

Maternity leave in Kazakhstan

Annual leave in Kazakhstan

Termination & severance in Kazakhstan

Kazakhstan's compulsory social security contributions

Kazakhstan social security for foreigners

Individual income tax

Health insurance

hassle-free Kazakhstani compensation & benefits

Compensation & Benefits

Kazakhstan compensation laws

13 month salary in Kazakhstan

Social security for Kazakhstani nationals

Hire in Kazakhstan in 24h without your own local entity.

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