Simplification of labor regulation as a factor in increasing Kyrgyzstan’s investment Attractiveness

On February 28, 2025, the lawyers of LEX Law Firm participated in the IBC MeetUp event dedicated to the new Labor Code of the Kyrgyz Republic. The event brought together companies from various industries, including banking, mining, telecommunications, food, and education sectors, as well as representatives of government agencies and diplomatic missions. The event was organized by the International Business Council (IBC).

Simplifying the regulation of labor relations has become a crucial step towards increasing the investment attractiveness of Kyrgyzstan. Transparency and balance of labor legislation create conditions for official registration of labor relations and investment in the development of human capital.

Bermet Karabaeva, Head of the Labor Department of the Ministry of Labor, Social Security and Migration of the Kyrgyz Republic, familiarized the meeting participants with the main provisions of the new Labor Code of the Kyrgyz Republic. Among the key changes worth mentioning are:

• The number of articles in the Labor Code has been reduced from 446 to 267, improving its structure and understanding.
• Remote and hybrid work formats have been officially recognized, which is especially relevant in the era of digitalization. Employees can now perform their duties remotely or in a hybrid format.
• The introduction of electronic employment contracts and work records, significantly simplifying hiring processes and personnel management.
• Introduction of electronic employment contracts and employment books, which greatly simplifies the employment process and personnel records.

• The limitation period for wage disputes is now three years from the day on which such wages should have been paid under Kyrgyz law. Previously, the limitation period for wage recovery disputes was unlimited.
• Salaries are now linked to the volume, quality, and complexity of work, in accordance with professional standards.
• Penalties for late salary payments, vacation pay, and final settlements upon termination have been introduced, encouraging employers to adhere to payment deadlines.
• Internships are now officially recognized as a form of on-the-job training, promoting professional skill development.
• Quotas have been introduced for the employment of graduates of orphanages and persons with disabilities.

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Many of these innovations were initiated by business representatives, including IBC members.

Also during the event, the State Tax Service under the Ministry of Finance of the Kyrgyz Republic presented a new electronic service for maintaining the register of employees through the Cabinet of the taxpayer (cabinet.salyk.kg).

This register must be used by all employers to enter up-to-date data on their employees.

LEX Law Firm would like to thank the International Business Council for organizing this important event. The IBC's efforts to improve working conditions and investment climate in Kyrgyzstan deserve recognition. We wish the organizers of the event further success and inspiration in implementing new initiatives and strengthening cooperation between business and government agencies!