IT Ukraine Association has expressed its support for the modernised draft Labour Code

The IT Ukraine Association welcomes the modernisation of labour legislation, emphasising that the new Labour Code should serve as a contemporary framework combining European standards of employee protection with the necessary flexibility for business.

The current Labour Code was adopted during Soviet times and no longer reflects today’s realities. Ukraine’s economy is rapidly digitalising, with new flexible forms of employment emerging (remote and project-based work, gig contracts, etc.), which the outdated Code fails to address. As a result, the labour market still operates under norms dating back to 1971, hindering the development of the digital economy.

The full-scale war has further highlighted the shortcomings of outdated regulation and the urgent need for a new Labour Code. The Association therefore supports a comprehensive reform – a modern and clear framework for labour relations that combines European standards of employee protection with the flexibility required by business.

The IT Ukraine Association has actively contributed to the drafting of the new Labour Code. A constructive dialogue has been established with the Ministry of Economy, and several important proposals from the IT sector have been incorporated into the draft during consultations. The Association expresses gratitude to the Ministry for its openness to cooperation and hopes that the views of the IT community will continue to be taken into account during parliamentary consideration of the draft.

Maintaining the Association’s key positions regarding the new Labour Code is critical to preserving the balance between protecting workers’ rights and supporting the growth of high-tech business in Ukraine. In particular, IT Ukraine highlights the following principles in discussions on labour law modernisation:

• Preservation of the current approach to gig contracts. Gig contracts have proven to be a modern and flexible form of cooperation, combining features of service agreements while providing basic social guarantees. Under the current Diia.City law, gig contracts are classified as civil-law agreements, not labour contracts, and therefore fall outside labour legislation. This status and special regime must remain unchanged for the IT industry. Any dilution of this status would create tax, legal and investment risks for Diia.City residents and the IT sector as a whole.
• Unique definition of labour relations. The criteria for determining the labour nature of relations must be distinct and not duplicate typical civil-law practices. Clear and unambiguous definitions will help prevent the misinterpretation of civil contracts as labour contracts based solely on formal criteria.
• Preservation of flexibility and freedom of choice in employment formats for highly qualified professionals. In the IT industry, workforce flexibility and the ability to choose convenient forms of cooperation are key factors of competitiveness. It is essential that the new Labour Code does not restrict the freedom of parties to determine their preferred model of collaboration. IT companies must retain the ability to work with specialists under labour contracts, freelance contracts or gig contracts – depending on project needs and the preferences of the professional. Freedom of choice is vital for the industry and enables IT business to remain and grow in Ukraine.

The IT Ukraine Association is convinced that incorporating these positions into the new Labour Code will result in a balanced document with progressive norms. The Association will continue to provide expertise and constructive proposals from the IT industry to achieve the best possible outcome. Together, the state and business community can create and implement next-generation labour legislation – flexible, transparent, and conducive to the growth of Ukraine’s digital economy.