How to Hire Remote Employees In 


The Basics

Ukrainian Hryvnia (UAH)
Employer Taxes
Payroll Frequency
Official Language

Employment in 


Hire Independent Contractors

Independent contractors or freelancers are self-employed individuals who provide services to companies as a non-employee. This is one of the most common ways companies tend to hire non-local designers, engineers, support reps, etc.

For legal and tax purposes, independent contractors are not classified as employees. They may work for multiple clients, set their own work hours, negotiate their pay rate, and decide how a job gets done.

For example, the IRS says that if an independent contractor or freelancer does work that can be controlled (what will be done and how it will be done) by an employer then they are, in fact, classified as an employee.

As you can imagine, hiring someone as an independent contractor versus an employee is a fine line to tread.

While there are benefits when you choose the contractor route, there are quite a few drawbacks to consider and you’ll need to weigh them carefully to determine the best fit for your company.

Benefits of Hiring Independent Contractors
Reduced overhead: Lower cost in expenses, payroll, benefits, and more.
Greater flexibility: Contractors can be brought on as-needed. If not a good fit, you simply don’t have to move forward with the contract.
Reduced legal risk: Contractors aren’t usually protected by employment anti-discrimination and workplace safety laws.
Disadvantages of Hiring Independent Contractors
Risk of Misclassification: Not only does this deny workers their proper protections, it can also result in steep penalties and damage to your company. If the IRS determines that employee misclassification has occurred, you will be liable for a percentage of the employees wages, FICA contributions, penalty fines, unpaid taxes, up to a year in prison, and more.
Lack of Control: Contractors are drawn to being independent because it gives them greater control over the work they perform and who they work with. Because they’re not employees, you can’t tell them what to work on and how it should be done.
Lack of Loyalty: Contractors come and go as-needed. Many companies hire contractors for short-term work, which makes it difficult to cultivate loyalty.
Increased Scrutiny: Using Independent Contractors typically leads to an increased risk of being audited.

Set up a subsidiary in 


A foreign subsidiary is a company that operates overseas as part of a larger company who’s HQ is in another country.

Establishing a foreign entity is great for having an international presence and accessing new markets. Though, setting up a subsidiary in Ukraine can be expensive, stressful, and time-consuming. It's not for the faint of heart.

To set up a subsidiary in Ukraine, you have to:

  1. Register your business name and file articles of incorporation
  2. File for local bank accounts
  3. Learn and keep track of the local employment laws
  4. Set up local payroll
  5. Hire local accounting, legal, and HR people

If you're lucky, this process can take months. If you're not so lucky, it can take up to a year. And on average, it costs about $50k-$80k, all-in-all, to get setup. And that's just for Ukraine.

Use an Employer-of-Record (EOR)

An employer-of-record (EOR) is a company that hires and pays an employee on behalf of another company.

An EOR is typically used to overcome the financial and regulatory hurdles that often come with employing remote workers.

Each country has its own payroll, employment, and work permit requirements for non-resident companies doing business in their jurisdiction. Meeting those demands can be a huge obstacle when it comes to hiring remotely.

At Panther, we help companies employ and pay people in over 160 countries, without having to set up a foreign subsidiary. Payroll, benefits, taxes, compliance, and more are all handled by us, at a fraction of the cost.

Outside of saving you months and tens of thousands of dollars, other advantages of using Panther are:

  • Ability to attract talented and motivated employees from all over the world.
  • Full legal compliance: There is no risk of violating local employment laws.
  • Transparency: Employees are still your employees. All the work, processes, operations and day-to-day business belong to you, the company, just like with any other employee. Panther just takes on all of the responsibilities, obligations and admin work related to your team's employment.
  • No risk of misclassification

Because you no longer have to set up your own subsidiary, you’ll save a ton of time and tens of thousands of dollars using Panther.

Paying Remote Employees

Paying employees in Ukraine is not the same as paying workers in your own country. Employees have to be paid using Ukraine's employment and payroll standards.

This means that you have to know, understand, and keep up with 1) fluctuating currency changes, and 2) local payroll and tax laws in the countries you’re looking to hire in.

Outside of the laws and regulations around payroll, there may be different conditions surrounding leave, overtime, termination, and more. As you can imagine, maintaining this kind of regulatory knowledge can be challenging. But it is crucial and necessary to follow local legislation.

After, you’ll have to determine the best way to pay your international employees. This can be done in a number of ways, including but not limited to:

Pay through a local entity

One of the most challenging (and expensive) parts of paying international employees is setting up the infrastructure to do so.

Before you start to run payroll, you have to register your company as the local employer in the country the worker resides in. As you can see in the “Set up a subsidiary” section, this is a multi-step process that can take up to a year and put you on your way to bankruptcy.

Work with an EOR

Outside of EORs acting as the full admin employer, many also provide remote payroll.

For example, at Panther, in just 1-click, you’re able to pay your entire global team, anywhere in the world. We send you an invoice each month, charge you in US Dollars, and pay your employees the same amount in their local currency.

We factor in currency fluctuations and use the mid-market rate plus any applicable fee passed on by our provider at cost at the time of billing.


 Specific Information

Working Hours

A workweek is 40 hours per week, 8 hours per day.


A maximum of 4 hours of overtime is permitted during 2 consecutive days at a time and not more than 120 hours overtime per year.

Additional overtime work may be applied in exceptional cases such as disruptions in production due to accidents or to avoid production downtime.

The following employees are forbidden from working overtime:

  1. Pregnant women and women who have children under 3 years old.
  2. Employees under 18 years old.
  3. Employees who are studying in school or college, on the days of their lessons.

The following employees can only work overtime with their consent:

  1. Women who have children from 3 up to 14 years old.
  2. Peopke with disabilities (if it is not forbidden according to medical recommendations).

Payroll Tax


  • 22% - Employer Contributions

Minimum Wage

The minimum wage is 36.11 UAH per hour and 6,000 UAH per month.


Pay Cycle

Twice a month:

Cycle 1: 15-20th of each month

Cycle 2: 31-7th of following month

13th Salary

Not required and is not common practice.


Paid Time Off (PTO)

Employees get 24 calendar days per year as a minimum, 2 days per month. 

Unused days accumulate and can be used at a future period. It is paid based on the average salary over the last 12 months. 

Public Holidays

There are 11 public holidays.

Sick Days

The first 5 days are paid by the employer; further days are paid by Social insurance fund.

Sickness pay is based on the average salary for the last 12 months and depends on the contribution period of employee:

0-3 years – 50%

3-5 years – 60%

5-8 years – 70%

8+ years – 100%

If the employee’s contribution period is less than 6 months within the last 12 months, the sick leave is paid based on minimum wage. 

Maternity Leave

Maternity leave lasts for 126 calendar days. 70 days should be taken before delivery and 56 after delivery.

It can be extended to 140 days by medical recommendation and to 180 days for women affected by the Chernobyl disaster.

Maternity leave is paid by Social Insurance Fund at 100% of salary.

Paternity Leave

There is no paternity leave but fathers can use the mother’s maternity leave if she has returned to work. For the father to be granted leave he must apply to the employer, providing them with a copy of the child’s birth certificate, a document confirming family ties and a certificate from the child’s mother’s place of employment that she went to work before the end of her leave.

Parental Leave

After maternity leave ends, mothers, fathers, and grandparents can take unpaid parental leave until the child turns 3.

Other Leave

Study leave – paid by the employer. The length of the leave depends on the duration of the exam period.

Marriage Leave

Up to 10 days

Bereavement Leave

Up to 7 days unpaid


Termination Process

Every case is analyzed individually, but in general the rights of employees are strongly protected by legislation.

Permanent employees’ termination conditions must be delineated in the employment contract.

Pregnant women, women with children under 3 years old and pre-pension employees are protected against dismissal.

Notice Period

Termination by the employer must include 2 months notice before the final date.

Termination by the employee must be done in writing 14 days before the final date.

Termination by mutual agreement has no notice period requirement.

Severance Pay

Severance pay is one month salary, on average.

Probation Period

The maximum probation period is 1 month for non-qualified employees and 3 months- for specialists and managers.