July 6, 16:24

Uzbekistan Employers Highlight Issues with Implementing New Sick Leave and Maternity Benefit System

Following the introduction of an updated procedure for granting sick leave and maternity benefits in Uzbekistan, business representatives have encountered several practical difficulties. During a meeting organized by the Confederation of Employers, participants discussed challenges related to employees working in multiple companies, payment issues for residents of the IT Park, and persistent demands from inspectors for paper documentation.

Digitalization and Payment Statistics

Thanks to the transition to digital accounting, the number of processed payments has significantly increased. According to the Agency for Social Protection, at the beginning of the current year, maternity benefits were issued very rarely at 15 inspected enterprises. However, the situation has improved this year: the state has already paid women on maternity leave the amount of 4.96 billion soms. Nevertheless, the initial phase of the new system revealed several shortcomings.

One of the central topics was the status of employees officially employed in several organizations simultaneously. The Unified National Labor System (ENST – mehnat.uz) records all employment positions and automatically sends electronic sick leave to each employer, but companies cannot exchange information with each other.

The most controversial point was the established limit of 10 minimum wages (which amounts to 12,710,000 soms) for calculating payments from the fund. Even if an employee receives income from multiple places and social tax is withheld from each salary, the benefit is calculated only within this limit. If the actual earnings exceed this threshold, the employer is obliged to cover the difference. One participant asked a direct question about the social fairness of this mechanism, noting that it puts conscientious employers at a disadvantage.

Issues Related to the IT Park

Another unresolved issue concerns companies that are residents of the IT Park. According to the Cabinet of Ministers decree of May 31, 2024, these organizations are exempt from paying social tax, which means their personnel are formally not considered insured in the state fund. Over two thousand companies operate within the IT Park ecosystem. An example was presented at the meeting of an employee working both in a regular firm and in a technology park resident company. The first enterprise pays for the first five days of sick leave, but it remains unclear who should finance the subsequent period of incapacity for work if the employer is from the IT Park. Official clarifications on this matter are currently unavailable and are under review by relevant agencies.

Control and Medical Problems

Furthermore, difficulties arise during inspections. Although the law on medical confidentiality prohibits disclosing an employee's diagnosis, and the electronic system contains all necessary information, some auditors continue to insist on providing paper sick leaves with a stamp. Dilshodhon Mukhamedjanova, a representative of the Agency for Social Protection, emphasized that an employee is not obligated to provide a paper certificate of incapacity for work, and the fund does not require such documents. Nevertheless, HR departments regularly face contradictory requirements from inspectors. In response, businesses proposed that agencies develop unified official recommendations to eliminate ambiguity in the rules.

Another problem arose after state polyclinics switched to a five-day work week. If a person falls ill on Saturday, the attending physician can record the consultation, but the system does not allow for the issuance of an electronic sick leave on a weekend. Consequently, the certificate of incapacity for work is only opened on Monday, but with the date of the first consultation indicated retroactively.

Medical Care and Foreign Specialists

The Ministry of Health was reminded that private clinics also have the right to issue sick leaves, provided they are registered in the DMED system. However, many private institutions have not yet completed this registration due to lack of awareness. Meeting participants suggested making connection to DMED a mandatory condition for obtaining licenses for such clinics.

The issue of payments to foreign specialists was discussed separately. Davron Vakhabov, Chairman of the Chamber of Commerce and Industry, cited the USA as an example where citizens largely cover medical expenses themselves. In turn, HR specialists with experience in the UAE and Turkey reported that foreign employees with residency visas in these countries receive health insurance on par with local residents. Although holders of the E2 category work visa in Uzbekistan are formally equated to local employees, the technical process of assigning payments for them is not yet fully streamlined.

It should be noted that starting from July 1, 2026, temporary disability benefits in Uzbekistan will be assigned on a proactive basis, without the need for applications or additional certificates from employees. It was precisely the first months of operation of the new system that helped identify issues requiring regulatory settlement by employers.

podrobno.uzJune 30, 14:37

Business in Uzbekistan Complains About Untimely Payments and Lack of Transparency in Public Procurement

Entrepreneurs in Uzbekistan shared their problems arising from interaction with the state procurement system. During an open dialogue held on June 11 in Tashkent, 370 appeals were presented. Of these, 62 cases concerned financial losses, violation of suppliers' rights, and lack of transparency in procedures.

Analysis of Public Procurement Problems

At the first meeting of the Council of the Association of Participants of Public Procurement (AUPP), held on June 30, Marat Abidov, Deputy Chairman of the Council, presented the results of the analysis. According to him, most complaints are not related to ignorance of the rules or lack of participant training, but rather to the functioning of the system itself.

The Main Problem is Non-Payment of Contracts

The most critical problem voiced by entrepreneurs was the absence of timely payment for already completed state contracts. Suppliers who have fulfilled all obligations and delivered products often face situations where the state customer either refuses to pay or postpones payment indefinitely.

Marat Abidov cited an example where an entrepreneur fully executed a contract worth about 100 million soms but never received payment. He emphasized that this leads to direct financial damage to businesses and reduces the motivation of entrepreneurs to participate in public procurement.

The situation is particularly difficult for small and medium-sized businesses, as enterprises incur costs for raw materials, salaries, and logistics, and the lack of income puts them on the verge of ceasing operations.

Issues of Transparency and Competition

The second significant area of complaints was the lack of transparency in tenders and issues of fair competition. Many participants believe that the winner is determined before the official announcement of the procurement. Entrepreneurs point out that customers sometimes formulate technical requirements in such a way that only one pre-known company can meet them.

Furthermore, after submitting applications, the commission, according to market participants, draws up review protocols in a way that rejects the proposals of other participants for formal reasons. Abidov noted that such questionable protocols and artificially inflated requirements objectively limit competition, which risks the state purchasing goods at inflated prices.

Proposals for System Improvement

Both groups of problems indicate a general need to improve control mechanisms in the field of public procurement. Business insists not so much on changing the rules as on their uniform application to all market participants.

To solve the non-payment issue, it is proposed to consider such cases on a priority basis and implement a system that eliminates the possibility of unpunished delays in payments by customers. Regarding tenders, Abidov suggested conducting selective checks of procurements and analyzing protocols for artificial limitations on competition.

Importance of Business Trust

Despite the government implementing training programs and developing support measures for industry, discussion participants believe that these initiatives will not yield the desired effect without trust from entrepreneurs. Jakhongir Yunusov, Deputy Director of the Agency for Industrial Cooperation and Public Procurement, emphasized the need not only for support but also for the effective use of state funds.

In conclusion, Marat Abidov proposed holding such open dialogues between the state and business no less than twice a month, and also distributing all 62 appeals into thematic groups with assigned responsible executors to move from discussion to practical problem-solving.

podrobno.uzJune 24, 15:50

Protection Strengthened and Powers of Compliance Services Expanded in Uzbekistan to Combat Corruption

Legal guarantees ensuring the independence of compliance service personnel in both state bodies and various organizations have been strengthened in Uzbekistan. Furthermore, their competencies in combating corruption have been expanded.

New Legislative Changes

The relevant law was approved by the president on June 22. These new provisions aim to increase the effectiveness of internal anti-corruption oversight and provide additional protection to specialists who discover cases of corruption.

Powers of Compliance Specialists

According to the text of the law, employees of compliance departments have the right to visit organizational facilities under their jurisdiction without hindrance, study necessary documents and information, and submit proposals regarding detected corruption violations.

Procedure in Case of Suspected Corruption

The law also establishes a procedure for when signs of a corrupt offense are discovered by the head of a department or there are serious grounds to believe that they support a criminal group. In such circumstances, the deputy head for compliance, after coordination with a higher compliance service, may send the relevant information and documents directly to law enforcement agencies.

Guarantees for Employee Protection

A separate section of the changes is dedicated to the protection of compliance service employees. Now, initiating a criminal case against such employees is possible only by the decision of the Prosecutor General.

Expected Results and Examples

It is expected that the implementation of these measures will help strengthen the autonomy of compliance departments, increase the effectiveness of the fight against corruption within state bodies, and create better conditions for the operation of internal control systems.

Previously, the Department for Combating Economic Crimes under the Prosecutor General's Office, together with the compliance service of the Migration Agency, identified several large-scale fraud schemes related to organizing employment for citizens in South Korea. These criminal activities were recorded in several regions of the republic.