Isn't This Interesting

[ecocks]

Curiously, I noticed a couple of months ago that many schools have teachers sign a contract which is illegal. In Ukraine many schools do not provide visa or work permit support on the grounds that it saves you taxes and makes it easier for you to work. In fact, it saves THEM money on payroll taxes, allows them to work you without benefits such as vacation, insurance or pension, and then they wonder why you have no loyalty or let your pursuit of private students get in the way of their schedules. If they have pulled a work permit for you as a full-time employee they are obligated to provide you with maternity leave, 24 days of vacation (24 calendar days per year), paid holidays, etc. AND you cannot be required to give more than two weeks notice. These rights cannot be signed away by any form of contract and fully cover foreign workers.

[rayjazz21]

However, if an employee does his homework and realizes this, then he'll realize that he also has leverage for "negotiation."  The problem is that many people, judging from forums and some of my own acquaintances who have taken jobs at language schools, don't know or understand much about the law and culture of the country that they move to, making it easy for others to take advantage of him/her.  In addition, one can feel "vulnerable" in a foreign country and feel as though his/her employer is the only source of help that he or she has.  It seems that this is a way to coax naive recent college graduates into a sticky and vulnerable situation, as many English teachers are just that - recent college graduates who have yet to decide on a path in life and want to see the world.  But, if one is educated, this issue of contracts doesn't pose much of a problem.  Just as the employer is not bound to anything, neither is the employee. 

[ecocks]

This is a big part of the problem Ray, not the solution.

[rayjazz21]

Of course, but until the solution is presented, teachers have to cover their bases somehow.    

Unfortunately, the solution isn't in the hands of teachers... Although in some respects, it is.  Teachers are willing to do almost anything to go abroad and do contribute to the problem by signing such contracts... However, ignorance plays a huge part in this.  I remember speaking with a teacher in Kyiv who teaches at an international school.  I remember asking her, "why Ukraine?"  She replied, "it was the first school to offer me a job, and it happened to be in Ukraine."  With such a mindset, it's no wonder that schools can do this.  But one solution is for the teacher to cover his bases by becoming a private entrepreneur with a tax number, pay his taxes, and not turn an eye to what the school does.  As long as he has an exit from any bad situations and does his own duty to Ukraine, there's nothing more that the teachers can do.  The Ukrainian government doesn't seem to be doing a good job on cracking down on these schools either.  It seems to be a problem that nobody cares about, including the teachers, schools and government.  Oh, Ukraine.

[ecocks]

Big BTW -

I left out sick leave on the list in my first little note.  This is an important one.  Under the PE scheme, no work = no pay.  If you are under a work permit you get the full sick leave benefits required by law for Ukrainian workers. 

[rayjazz21]

Yeah, good point there.  Although, I'm interested... From what I hear... the Ukrainian goverment doesn't react so well to such complaints, in comparison with American courts.  Is this correct?

[guyliana]

Yes, unfortunately, it is correct...
There are 2 ways for such companies to escape from penalties of state controlling bodies.
1.   Your contract “is not officially concluded”. Have anyone seen your contract except the company and you? No governmental institution will react if this contract is not officially concluded. But to tell the truth, such cases are not common among the Ukrainian companies.
2.   The most common is the second scheme. As it was mentioned in the forum, the companies sometimes want to escape from paying taxes. In other turn, they do not want to spend much time to obtain Ukrainian work permit for their employees-foreigners. Now the case. According to the Law of Ukraine, there is a big difference between the civil contract (agreement on provision of services) and labor contract. The latter should mean obtaining work permit for foreigner prematurely to concluding such contract. And only labor contract gives the employee all the labor guarantees (vacation, sick leave etc.). But if the company intends to conclude a civil contract with a foreigner, I bet you won’t find any clause in it regarding your work on the territory of Ukraine. Thus, it is presumed that you perform your work as a contractor on the territory of your residence (not the territory of Ukraine). According to the Law of Ukraine your income earned will be subject to taxation in the country of your residence. Great way for the company to escape from paying taxes, isn’t it?
The second way is always risky for the company. In any case it will be responsible for proving that the work was not performed on the territory of Ukraine and you were not invited as its employee. And if the company has a good lawyer it will win the case ….

[ecocks]

Not sure what this has to do with the PE versus work permit situation.  It seems more like a consideration of getting a labor contract negotiated properly. 

Simply, if you work as a PE, you need to set out a strong, comprehensive contract which covers all the things you don't get if you are without a work permit - vacation, sick leave, insurance, etc.  If you don't then you have placed yourself in a classic, "no work, no pay" siituation.  The blind of the lower taxes isn't your problem unless you let the employer pass the tax-paying burden on to you.  While you at first think this sound good to be independent, free and able to charge your own rate you eventually realize you are on a treadmill of having to work and do your record-keeping to support billing for services.  After you have hours cut without notice, stay out sick for a few days with grippe or want to go to Egyot with your girlfriend for a 2 week vacation you come to understand that you didn't make YOUR life easier.  You made your employers life easier and enabled them to avoid providing you the traditional employee benefits that Ukrainian citizens enjoy.

I get emails and phone calls several times a month from teachers commenting that they don't understand how to make ends meet and build a stable workload.  The more I looked into this the more I realized it is this PE/work permit situation that is the root cause of the problem.  In the last week, I have had 2 teachers complaining that their work dried up as people and companies began going into summer mode and putting classes on hold.  Being an entrepreneur is not easy, nor is it the answer to every expat's employment dilemna.

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