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Ukraine Introduces New Rules for Reservation (Exempting) of Employees from Mobilisation

On 27 January 2023, the Cabinet of Ministers of Ukraine introduced new rules regarding reservation (temporary exemption) of employees from military mobilisation through the adoption of Resolution No. 76 “On Certain Issues of Implementing the Provisions of the Law of Ukraine 'On Mobilisation Preparation and Mobilisation regarding the Reservation of Persons Liable for Military Service for the Period of Mobilisation and Martial Law”.

The new procedure, which went into effect on 31 January 2023, applies to the employees of state bodies and institutions as well as private companies. In the private sector, employees of the following companies can be exempted from mobilisation:

  • companies instructed to perform mobilisation tasks (orders);
  • companies producing goods, performing work or rendering services required for the needs of the Armed Forces of Ukraine or other military formations;
  • companies critically important for the functioning of the economy and ensuring the livelihood of the population during martial law.

To be considered critically important for the functioning of the economy, a company must meet at least three of the following criteria:

  • make payments of more than EUR 1.5 million of taxes, fees and allocations to the state or local budgets (excluding customs duties) during a reporting tax year;
  • receive income in foreign currency (excluding for loans and credits) exceeding EUR 32 million during a reporting tax year;
  • be of strategic importance for the state security and economy as defined by the Resolution of the Cabinet of Ministers of Ukraine No. 83 dated 4 March 2015;
  • be important for the national economic sector or the needs of the local community according to criteria established by the executive bodies or other state authorities;
  • have no overdue payments of a single contribution to state social insurance;\
  • have the average salary of the employees in the last calendar quarter at the level not lower than the average salary in the region for the last quarter of 2021 (according to the data from the state statistics authorities);
  • be a resident of Diia City.

Certain types of companies can fall under this policy by meeting only two criteria from the above list. These companies include fuel and energy companies, certain television media companies, and medical, educational or social security institutions financed from the state or local budgets.

Critically important entities also include the following institutions: specialised agencies of the UN, foreign diplomatic institutions in Ukraine, representative offices of donor institutions, contractors of international technical assistance projects, offices of international organisations, and international and Ukrainian non-governmental organisations, which perform humanitarian aid projects at the expense of international partners according to the list of the Secretariat of the Cabinet of Ministers of Ukraine or the Ministry of External Affairs of Ukraine.

To be recognised as complying with the criteria for being critically important, a company must apply to the central executive body or other state authorities with supporting documents. Only after that may the company apply for reservation of its employees from mobilisation. Any decision on reservation is subject to approval from the General Staff of the Armed Forces of Ukraine and the Ministry of Economy.

The number of employees subject to reservation must not exceed 50% of the persons liable for military service employed by the company. A higher number of reservations is possible, subject to justification. No limitations to the reservation of employees apply to fuel and energy companies, the list of which must be approved by the Ministry of Energy and to the institutions listed above.

The period of reservation cannot exceed six months.

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