EBA and Lugera Ukraine launch a joint project to promote business transparency and legal salaries

13/ 11/ 2019

The European Business Association and the international company Lugera in Ukraine initiated the joint project Transparent Business – for Legal Salaries, designed to set a trend on the Ukrainian market for official labor relationships and to promote the refusal to pay black or gray salaries. Official employment and a “white” (legal) salary are a significant factor for employees to consider and choose a new job. For example, 63% of the respondents of the survey* while searching for a job confirmed that official employment is an important criterion for their employment. However, less than half of the respondents (around 40%) who answered positively understand and are aware of all the benefits of being in the legal employment relationship. At the same time, improving the investment climate in Ukraine and growing the economy are possible under the rule of law, paying taxes and adhering to the ethics of doing business transparently and having equal rules of the game for all members of the market. Therefore, by building a community of transparent and responsible business in Ukraine, we encourage all companies to adhere to legal employment arrangements. The European Business Association, together with Lugera Ukraine, is launching the “Transparent Business – for Legal Salaries” project to create an open platform for companies, which would like once again to remind the market, partners and employees about the importance of transparency principle. In addition, according to the results, 37% of respondents said that receiving white salaries is not important for them. More than half of the surveyed candidates do not understand the difference between white (legal) salary and salary in the envelope (paid in cash), 14% said that the white salary is lower, because a lot goes to taxes, 12% of the respondents are indifferent and they do not believe in retirement payments (pension). Anna Derevyanko. Executive Director of the European Business Association. By uniting conscientious business, we at the European Business Association have always adhered to and promoted official labor relations. However, it is important that the circle of like-minded people grows and that white labor relations become really a trend in Ukraine, as it is beneficial for both the company, the employee and the state as a whole. Survey results show that not everyone understands the benefits and opportunities of transparent legal salaries. Due to all the reasoning above, we came up with an idea of launching this project to set a trend and promote official labor relationships and legal salaries. We would like to remind companies and employees about the benefits of getting a white paycheck: It guarantees that you will receive salaries on time and in full. Getting paid sick leave and vacations. From taxes and social contributions to the formation of pensions and unemployment insurance. As a personal income taxpayer - getting the right to a tax refund, etc. Anastasia Shevchenko. CEO of Lugera Ukraine. We are an international company, so we often communicate with our European colleagues to share the experience. Interestingly, they do not understand the terms white or gray salaries that exist in our market. Therefore, if we are to become Europe not only geographically, we must take care of transparent business and only official legal employment relations. This is how our company works all over the world, and in Ukraine, and that’s how the whole domestic business should work. Tax optimization means terrible roads, unfinished reconstruction of the hospitals and schools, and, after all, unfair business competition. We are convinced that the ubiquitous fashion for white salaries and official labor relations is in the interests of both business and society, and that it is only a matter of time to be a common trend. We are sure that this joint project with the European Business Association will be the driver of this important transformation for our country and society. In Ukraine, every company that pays legal salaries acts as an employee tax agent and makes the appropriate deductions: 18% - personal income tax, 22% - single social contribution and 1.5% - temporary military tax. Therefore, by receiving official salaries, citizens make their contribution to the development of the state. Reference: * The survey was conducted before the start of the Transparent Business – for Legal Salaries project (during August-October 2019). Total number of the respondent - 935 people from different regions of Ukraine. To join the project click here>http://legalsalaries.com.ua/

The European Business Association and the international company Lugera in Ukraine initiated the joint project “Transparent Business – for Legal Salaries”, designed to set a trend on the Ukrainian market for official labor relationships and to promote the refusal to pay “black” or “gray” salaries.

Official employment and a “white” (legal) salary are a significant factor for employees to consider and choose a new job. For example, 63% of the respondents of the survey* while searching for a job confirmed that official employment is an important criterion for their employment. However, less than half of the respondents (around 40%) who answered positively understand and are aware of all the benefits of being in the legal employment relationship.

At the same time, improving the investment climate in Ukraine and growing the economy are possible under the rule of law, paying taxes and adhering to the ethics of doing business transparently and having equal rules of the game for all members of the market. Therefore, by building a community of transparent and responsible business in Ukraine, we encourage all companies to adhere to legal employment arrangements. The European Business Association, together with Lugera Ukraine, is launching the “Transparent Business – for Legal Salaries” project to create an open platform for companies, which would like once again to remind the market, partners and employees about the importance of transparency principle.

In addition, according to the results, 37% of respondents said that receiving “white” salaries is not important for them. More than half of the surveyed candidates do not understand the difference between “white” (legal) salary and salary in the envelope (paid in cash), 14% said that ” the white salary is lower, because a lot goes to taxes, 12% of the respondents are indifferent and they do not believe in retirement payments (pension).

Anna Derevyanko Executive Director of the European Business Association

By uniting conscientious business, we at the European Business Association have always adhered to and promoted official labor relations. However, it is important that the circle of like-minded people grows and that "white" labor relations become really a trend in Ukraine, as it is beneficial for both the company, the employee and the state as a whole. Survey results show that not everyone understands the benefits and opportunities of transparent legal salaries. Due to all the reasoning above, we came up with an idea of launching this project to set a trend and promote official labor relationships and legal salaries.

We would like to remind companies and employees about the benefits of getting a “white” paycheck:

It guarantees that you will receive salaries on time and in full.
Getting paid sick leave and vacations.
From taxes and social contributions to the formation of pensions and unemployment insurance.
As a personal income taxpayer – getting the right to a tax refund, etc.

Anastasia Shevchenko CEO of Lugera Ukraine

We are an international company, so we often communicate with our European colleagues to share the experience. Interestingly, they do not understand the terms "white" or "gray" salaries that exist in our market. Therefore, if we are to become Europe not only geographically, we must take care of transparent business and only official legal employment relations. This is how our company works all over the world, and in Ukraine, and that’s how the whole domestic business should work. Tax optimization means terrible roads, unfinished reconstruction of the hospitals and schools, and, after all, unfair business competition. We are convinced that the ubiquitous fashion for "white" salaries and official labor relations is in the interests of both business and society, and that it is only a matter of time to be a common trend. We are sure that this joint project with the European Business Association will be the driver of this important transformation for our country and society.

In Ukraine, every company that pays legal salaries acts as an employee tax agent and makes the appropriate deductions: 18% – personal income tax, 22% – single social contribution and 1.5% – temporary military tax. Therefore, by receiving official salaries, citizens make their contribution to the development of the state.

Reference:

* The survey was conducted before the start of the Transparent Business – for Legal Salaries project (during August-October 2019). Total number of the respondent – 935 people from different regions of Ukraine. To join the project click here>http://legalsalaries.com.ua/