Employer of Record in Armenia
Skuad’s EOR solution is an integrated, tech-enriched human resource (HR) platform that can take care of all your HR needs, including recruitment, hiring, onboarding, contracts, payroll, taxes, probation, termination, visas, and work permits. Talk to a Skuad expert and book a demo today to kick-start your expansion plans in Armenia.
Armenia at a Glance
Population: 2,963,900 (2021 estimate)
Currency: Armenian dram (AMD)
Capital city: Yerevan
Languages: Armenian, Assyrian, Greek, Russian, Kurdish, English, and Russian
Gross Domestic Product (GDP): USD 32,893 billion (PPP) (2019)
Employment in Armenia
Labor laws in Armenia are defined by the Labor Code of the Republic of Armenia. The regulations of the legal acts containing norms of the labor law need to be mandatorily adhered to by all employers (citizens or business entities), regardless of their legal form and form of ownership.
Skuad's EOR solution helps organizations remain compliant with the Armenian employment laws. Contact Skuad today.
Contractors vs. Full-time Employees
In Armenia, the employee-employer relationship gets regulated by the following laws:
- Labour Code
- Civil Code
- Law on Minimum Monthly Wage
- Law on Employment
- Law on Trade Unions
- Law on Employers' Union
The employment agreement must be in the Armenian language mentioning the employee's wage or salary, job details, leave details, and other benefits.
Fixed-term contracts should consist of the start and the end date.
Indefinite contracts can get terminated following the statutory notice period (please refer to the Termination section). Employers need to screen employees for details on their previous job before hiring and have their credit scores and criminal records checked. There is no law governing medical screening.
Difference between Contractors vs. full-time employees
While the Labor Code sets out the employee-employer relationship, the Civil Code regulates contractual relations between independent contractors and companies. Foreign companies can hire independent contractors even without registering in Armenia.
Employees and employers must understand the difference between employees and contractors. The latter enjoys more independence in terms of how to complete the work vis-à-vis the former. However, the independent contractor has the liability to pay their taxes, social security, and health insurance premium. They also need to contribute to unemployment funds and workers' compensation funds. However, the employer has responsibilities to pay for workers' compensation, health insurance, social security, and more full-time employees. Employers need to classify workers and contractors accordingly and not misclassify and be subject to penalties.
Skuad's high-tech, centralized HR platform can help your interest as a contractor or other expansion in Armenia.
Talk to a Skuad expert and book a demo today.
Hiring in Armenia
While hiring in Armenia, keep in mind that discrimination is strictly prohibited. It includes discrimination based on ethnic or social origin, sex, skin color, race, genetic features, religion, language, political or other views, age, property status, disability, personal or social circumstances. The Labor Code says contracts must include the worker's name and surname, company name, job description, salary, payment method, bonuses, additional payments, probation period duration, and working hours. The following portals can help you find jobs.
Skuad's extensive, hyper-localized Armenia EOR solution makes the hiring process easy and hassle-free. We handle all the complicated tasks related to payroll management and taxes in compliance with the local laws so that you can focus on other aspects of global expansion.
Talk to Skuad experts now to learn more about hiring in Armenia.
Probation & Termination
The probation period is up to three months. Only in certain specific cases, the probation period can be extended to six months.
The termination by the employer can be on medical grounds and when the employee rejects a transfer of job offer. Also, an employer may terminate the employee if the role is no longer required.
- The employer must give two months' notice in the event of the liquidation of the company. The notice period is ten days for a fixed-term contract.
- Three months before any collective dismissal, the employee is expected to notify the state employment service and the union which is the employees' representative.
A notice of five days is needed for one year of service, six days for five years of service, and seven days for ten years. Employees who become redundant enjoy a month of separation pay, also called severance pay, but severance pay is up to two weeks.
To ensure your expansion endeavors adhere to the laws regarding probation and termination in Armenia, talk to Skuad experts and book a demo today.
An EOR service helps organizations manage payroll in the country. Additionally, it helps handle taxation and compliance management matters, and the burden gets eased from employers. Expanding your business operation beyond your national borders can be an expensive and time-consuming task. It involves several complex procedures that can take a lot of time to complete. By choosing to partner with an Armenia EOR service, you can expedite the expansion process and simplify it.
Benefits of an Armenian EOR Solution
The benefit of working with an EOR service is that you can focus on growing your company while your EOR partner takes care of the rest. Skuad can make sure each of your employees has a positive hiring experience. Since we take over all the HR-related processes, including hiring, payroll, taxation, and securing visas and work permits for your employees, you'll be able to focus on the business side of things. Further, you won't have to worry about contravening any of the Armenian employment laws.
Talk to us to learn more!
Work Permits in Armenia
As a customary rule, those who hold the Armenian visa are not qualified to work in Armenia unless they have a work permit. Highly skilled business owners, foreign specialists, and executives get excluded from work permit requirements.
The transfer of staff and whether they are skilled or non-qualified determine the attainment of a work permit and a temporary residence permit. In Armenia, the same policy for work permits exists for local hires, intra-company transfers, and subcontracting employment. It is applied on behalf of the legal employer and gets issued for the employment contract term. The law obliges the employer to seek for Armenian citizens to perform the job.
Those who get employed by any foreign company get excluded from work permit provisions.
Except for a foreign individual spared from work permit terms, the employer needs first to apply for a work permit from the Ministry of Labour and Social Affairs (MLSA).
The simplest way to speed up work permit processing is to keep one employer for the entire stay. It seems incompatible with contracting at first, but if you use Skuad, you can ease your operation. The EORs even collect payments, pay taxes (including handling the admin) and send the net salary to you. With our comprehensive knowledge of local tax law, you are assured of compliance.
Documents required to obtain the work permit in Armenia
- The employer needs to apply with the Ministry of Labor and Social Affairs.
- The documents required include – the passport and the educational certificates of the employee along with the application form.
- The other documents required are – two photographs of the employee and proof that they paid government fees.
Securing an Armenia Work Permit through Skuad
Skuad's extensive EOR services include sponsoring work permits. We have comprehensive knowledge of the local laws about work permits. Immigration laws are revised regularly, so it's hard to keep up with the latest developments. We have expertise in the taxation and immigration policies in the Caucasian region, ensuring that you receive up-to-date, accurate information. Talk to us today to learn more.
Payroll & Taxes in Armenia
Armenian Payroll Taxation details
In Armenia, the tax levied on workers and employees applies differently to different income sources.
Payroll Options in Armenia
The four main choices include,
Skuad's bespoke EOR solution for payroll and taxes can make your expansion easier and save you time and money.
Talk to us today to learn more
Incorporation: Setting Up a Subsidiary in Armenia
The Armenia subsidiary setup process entails compliance with the corporate laws.
Requirements of incorporating an LLC in Armenia:
- The entity should have one director and one shareholder.
- The director and the shareholder can be of any nationality.
- The paid-up share capital needs to be a minimum of 1 EUR.
- Since LLCs operate much like a residential company, the annual audited financial statements need to be submitted to the country's commercial registry.
The following steps are required to set up an LLC in Armenia:
- Application for registration
- Furnishing resolution of founders on the company of the legal body
- Building a charter of the legal entity recognized by the founders' body
- Furnishing proof of state fee payment
- Providing information of the subsidiary's director and the passports
- Furnishing a statement on the actual beneficiaries of the corporation
- Presenting documents showing the status of a legal person as well as the company's founding records
- Choosing a unique name for the organization
Talk to us to know how Skuad's robust EOR solution can help your business in the hire-to-fire cycle without the need for your business to learn the LLC laws in Armenia or get into the trouble of setting up a subsidiary in the country. Skuad's EOR services handle all compliance functions, including setting up a subsidiary.
Get in touch with Skuad experts to learn more!
Professional Employer Organization (PEO)
A PEO works as your co-employer – it means that you are in a joint employment relationship with the PEO handling jobs like recruiting, hiring, onboarding, managing payroll and taxation, and ensuring compliance end-to-end on an outsourced basis.
Your business entity needs to submit its wage-related details using the Federal Employer Identification Number of the PEO. The official contract called Administrative services outsourcing (ASO) with the PEO determines the HR functions that the PEO will manage and handle on your behalf.
On the other hand, an EOR service is provided by organizations that take over the legal responsibilities of employment to decrease complexities associated with HR functions, market access, and paying employees internationally. The EOR firm becomes the primary employer of their partner organization's employees on paper.
Skuad offers both EOR and PEO services. Depending on your requirements, you can benefit from our industry expertise to expedite your expansion in the Caucasian region in Europe.
Talk to our experts to book a demo.
Conclusion: What Gives Skuad's Armenian Solutions an Edge?
Skuad offers customized EOR solutions to kick-start your business in Armenia. Its extensive knowledge of the local laws, language, customs, and market will ensure the smooth expansion of your business. By taking over all your HR-related tasks, we can save you time, labor, and resources, which will let you better focus on the business side of expansion.
Talk to Skuad experts today to learn more.