In light of the ongoing war in Ukraine, the country is reforming its immigration policy to combat the severe labour shortage.
The war in Ukraine has been ongoing for two years and has changed the lives of Ukrainians everywhere. Due to the danger in the country, 2.7 million Ukrainians, young and old, have left the country and have not returned. Most of those who left the country are skilled workers. The mobilization of men into the armed forces has also played a role, as up to 1 million men of working age are currently defending the country.
As the nation struggles with the ongoing war, it faces a multifaceted challenge that goes beyond military strategies and political negotiations. The war in Ukraine has not only resulted in a significant humanitarian crisis but has also triggered a domino effect, causing a severe shortage of skilled professionals vital for the country’s recovery. This confluence of factors has prompted Ukraine to reconsider its approach to immigration policy, attempting to strike a delicate balance between addressing the immediate staff shortage and ensuring long term socio-economic stability in the country. In this article, we delve deeper into the complex dynamics of the war in Ukraine, the staff shortages it has caused, and the corresponding changes in immigration policy as the country tries to recover from adverse circumstances.
Staff shortage due to the war
Labour emigration intensified after an armed conflict, initiated by Russia against Ukraine in 2014, turned into a full-scale war in 2022. According to studies by the International Labour Organization, nearly 5 million jobs have been lost in Ukraine. The consequences of the war (destruction, closure, and relocation of businesses), refugees leaving the country and an increase in the number of internally displaced persons have created a situation of mismatch between the geographical location of jobs and the labour force. As of May 2023, the unemployment rate was around 20%, while on the eve of the Russian invasion, the official unemployment rate in Ukraine was under 10%. In recent years the highest percentage of vacancies caused by skills shortages can be seen in industrial sectors, wholesale and retail trade, construction, and public administration.
Currently, the Ukrainian government is facing not only a skill shortage problem but also other challenges that are caused by war and require policy adjustments. Therefore, the Ministry of Economy of Ukraine is implementing new legislation aimed at addressing the skill shortage, activating the labour market, and reforming some governmental authorities in this sphere, in particular the Employment Centre. One of the innovations is the adoption of laws aiming to reduce the load on employers by canceling the high minimum salary requirements for foreign employees. In total, the Ukrainian Restoration Plan envisages filling more than one million seven thousand new jobs over the coming years.
Other governmental actions and plans focus on enhancing the national social protection system, especially for internally displaced persons; attracting investment; preserving workplaces, for example by relocating companies away from the war zones; crediting existing businesses and making grants to new ones; and reducing unemployment in various ways. The most important legislative provisions are being renewed by the ministries and parliamentarians promptly and efficiently.
Legislative changes to simplify immigration rules
Recognising the urgency of addressing the acute shortage of skilled professionals that has been exacerbated by the ongoing conflict, Ukraine is increasingly focusing on attracting foreign professionals as a strategic imperative to stabilise the economy. The state is aware that the injection of international expertise is crucial to revitalizing key sectors of the economy and promoting sustainable growth. In response to this challenge, the government has made significant efforts to simplify immigration rules, seeking to streamline bureaucratic processes and create a more favourable environment for foreign professionals. Among the innovations made by the legislator are improvements to the rules for granting immigration permits, attempts to allow and regulate multiple citizenship, and new rules governing e-residency.
Improvements to the rules for granting immigration permits
In June 2023, the Verkhovna Rada adopted the Law on Improving the Conditions and Procedure for Immigration of Foreigners and Stateless Persons to Ukraine.
The approved amendments to the legislation reduce the timeframe for consideration of applications for an immigration permit from one year to six months and introduce a basis for granting a permanent immigration permit to persons who have continuously resided in Ukraine for more than five years on a temporary residence permit (except for foreign students).
The law also simplifies the procedure for granting immigration permits to family members of foreign highly qualified specialists and workers if the Ukrainian economy is in dire need of them.
In addition, an interesting change was the addition of a list of circumstances under which being married to a Ukrainian citizen or an immigrant is not recognised as a valid reason for granting an immigration permit. In particular, now, in order to obtain a permanent residence permit based on marriage, and to verify certain circumstances, interviews with the applicant and the other spouse are mandatory, as are interviews with other persons if there are sufficient grounds to believe that they have the relevant necessary information. Requests are sent to the concerned state authorities to obtain information on whether there are grounds for refusal to grant an immigration permit, which takes a certain time (the entire procedure takes approximately one year).
Multiple citizenship
In order to facilitate the acquisition of Ukrainian citizenship, in January 2024, President Volodymyr Zelenskyy submitted a bill on multiple citizenship to the Verkhovna Rada. Citizenship can be obtained by the descendants of Ukrainians who emigrated to various countries in Europe, the United States, Canada, Asia, and Latin America. Under the bill, Ukrainian passports may be granted to foreign volunteers, but not to Russian citizens. To obtain citizenship, some applicants will need to pass an exam demonstrating knowledge of the Constitution of Ukraine, Ukrainian history, and the level of proficiency in the state language. The applicant must also submit a declaration of recognition as a citizen of Ukraine along with the application. This declaration is submitted instead of a declaration of renunciation of foreign citizenship.
The draft law further provides an opportunity to acquire the citizenship of a partner state of Ukraine without losing Ukrainian citizenship. There are currently 33 partner states, mostly in Europe and North America.
E-residency
The legislator recently adopted a regulation on e-residency. The regulation defines the mechanism for acquiring and revoking e-resident status; the procedure for forming and maintaining the e-resident system jointly with the State Tax Service and banks; and the protection of personal data of e-residents.
A foreigner acquires e-residency status after applying (in English) through the e-resident information system, the form of which is approved by the Ministry of Digital Transformation.
The application must be accompanied by a scanned copy of the applicant’s passport. After submitting the application, reviewing the notice on the processing of personal data, and indicating that he or she has no criminal record, the applicant creates an account in the e-resident information system.
The launch of the e-residency project will allow foreigners to:
- become entrepreneurs in Ukraine with a few clicks;
- manage their business remotely using modern technologies;
- sign documents with an electronic signature;
- open and manage bank accounts remotely; and
- pay taxes on preferential terms.
The status of e-resident can be obtained by foreigners who have turned 18 years old, except for those who:
- have the right to permanent residence in Ukraine or are already tax residents of Ukraine;
- are stateless persons;
- receive income originating in Ukraine for goods, work, or services; or
- are citizens of Russia and countries on the FATF’s ‘grey’ or ‘black’ list.
It is also worth noting that Ukrainian citizens cannot be e-residents.
Takeaway for Employers
While Ukraine is fighting hard on the military front, the legislator is taking serious steps to maintain economic stability, improve legal norms, and ensure international cooperation. The resilience of the Ukrainian people and the strategic recalibrations in immigration policy signal a collective commitment to rebuilding a stronger, more sustainable future.
Published: Ius Laboris, 23 February 2024
Authors: Valeriya Bezpala, Anna Odynokova