HR Compliance Audit in Uzbekistan: Which Employment Documents and Processes to Check to Reduce Legal Risk

In many small companies, HR paperwork is handled on the fly. The employment contract comes from an old template, the accountant drafts the orders, and whoever holds the electronic digital signature (EDS) key enters the data into the Unified National Labor System (UNLS). While things are calm, nobody notices the inconsistencies. They surface at the worst possible moment: a contested dismissal, a change of HR officer, an inspection.

An HR compliance audit helps you find these gaps before they become a problem. This article explains what to check, which legal provisions apply, which mistakes come up most often and how to fix them. At the end you will find a risk table and a checklist you can use to run an initial employment compliance review yourself.

What Is an HR Compliance Audit?

Checking three layers against each other

Every employee in your company exists in three “versions”.

1. Documents: the employment contract, supplementary agreements, employer’s orders, acknowledgement sheets and the employment record book.
2. The UNLS: the registered contract, the position in the organisational structure, changes and the termination date.
3. Actual work: what the person does, where, on what schedule and how much they are actually paid.

Ideally, all three versions match each other and comply with the Labour Code. This is exactly what an HR compliance audit checks. For example, under the contract an employee is a manager on a fixed salary, the UNLS lists them in a different position, and in practice they have been running a department on a different salary for six months. Each such mismatch is a potential dispute or claim.

How an HR compliance audit differs from a strategic HR audit

The two are often confused, although they answer different questions.

 Well-drafted contracts will not explain why new hires leave after two months. Conversely, a well-run hiring process will not protect you in a dispute if the dismissal order contains an error. If you are interested in the other side of the question, read our colleagues at SPECTRE on how to audit your HR processes. This article focuses on documents and mandatory procedures.

Is an HR compliance audit mandatory?

An HR compliance audit is an internal control tool. What matters is not the audit itself but the requirements it checks: the rules for drawing up contracts, UNLS registration deadlines, the dismissal procedure and the other provisions discussed below. These requirements are binding on the employer whether or not an audit is carried out. The Labour Code provides additional guarantees for certain categories of employees and exceptions to the general rules for micro-firms and individual entrepreneurs.

If you are a micro-firm or an individual entrepreneur. Some points in this article apply to you differently:

• a micro-firm may choose not to adopt some or all internal policies, such as the internal labour regulations (ILR), regulations on pay and bonuses, or shift schedules. In that case, these terms must be set out in employment contracts based on the standard form, and the list of one-off gross breaches of duty may be included in the contract itself (Labour Code, Arts. 505, 506);
• a micro-firm must give notice of changes to working conditions no later than one month in advance, and its employees may resign by giving 7 calendar days’ notice (Arts. 505, 506);
• an individual entrepreneur (IE) hires employees without issuing an order and does not keep employment record books; the employment contract is drawn up in three copies, one of which is submitted to the tax authority (Art. 508);
• an IE must give at least 14 calendar days’ notice of changes to working conditions, an IE’s employees may resign by giving 7 calendar days’ notice, and the IE must notify the tax authority of a contract termination no later than three working days after it (Arts. 510, 511).

When Should You Carry Out an HR Compliance Audit?

A review is useful at any time, but it is especially worthwhile when the risk of inconsistencies is higher than usual:

• the HR officer, accountant or outsourced provider who handled HR records has changed, and you need to understand what you have inherited;
• a new director or owner has taken over and is now responsible for everything documented before them;
• headcount has grown quickly: contracts were signed from a single template, and changes were going to be documented “later”;
• you are planning to bring in an investor or to reorganise, and the buyer or investor will review employment risks;
• a dispute is brewing: an employee complaint, a contentious dismissal or a claim from a former employee;
• a year has passed since the last review. Regular audits cost less than fixing accumulated errors.

How to Prepare for the Audit

Which documents to gather

Before you start, collect the following in one place:

• employment contracts and all supplementary agreements to them;
• orders on hiring, transfers, changes to terms, leave, suspension, disciplinary measures and dismissal;
• acknowledgement sheets for the internal labour regulations (ILR) and other internal policies;
• the internal policies themselves: the ILR, regulations on pay and bonuses and on personal data, and the collective agreement, if one has been concluded;
• employment record books or extracts from electronic employment record books;
• timesheets and payroll statements for the past year;
• civil-law contracts for work or services with individuals.

Checking UNLS records against your headcount

The second source is your organisation’s account in the UNLS at my.mehnat.uz. Review the organisational structure and the registered contracts, and compare them with three other lists: the staffing table, the payroll statement and the list of people who actually work for you. Record every mismatch: who appears on one list but not on another, and whose position, pay rate or dates do not match.

Full review or sample?

If the company has up to 30 employees, it is easier to review every personnel file. With a larger headcount, you can start with a sample, which should always include:

• everyone hired in the last 6–12 months;
• everyone whose terms or position changed during that period;
• everyone working under civil-law contracts.

This is our recommendation, not a legal requirement. Errors tend to accumulate around staff “movements”.

Employment Contracts and Hiring

Are employment relationships disguised as civil-law contracts?

The Labour Code expressly prohibits civil-law contracts that in fact govern employment relationships (Labour Code, Art. 11). The signs are familiar: the person works to the company’s schedule, follows its internal rules, reports to a manager and receives a fixed amount every month.

If a court recognises such a relationship as employment, the employment contract is deemed concluded from the date the civil-law contract was signed (Labour Code, Art. 33). This means the person retroactively acquires all employment guarantees, including leave, severance pay and protection against dismissal.

What to do: review all civil-law contracts with individuals. Where the relationship is in substance employment, put in place an employment contract and an order, and register them in the UNLS.

No one should work without documentation

If an employee was allowed to start work by a person authorised to hire, or with that person’s knowledge, the employment contract is deemed concluded from the first day of work, even if there is no paperwork (Labour Code, Arts. 26, 128). This does not relieve the employer of the duty to formalise the relationship: the contract and the order must be prepared within three days of the start of work (Labour Code, Art. 128).

What to check: whether anyone is working “on trial”, “as an intern” or “without a contract for now”.

Form, mandatory terms and details of the contract

An employment contract is concluded in writing, on paper or electronically, in at least two copies. The employee’s receipt of their copy is confirmed by their signature on the employer’s copy (Labour Code, Art. 106).

The contract must include (Labour Code, Art. 104):

• the place of work: the employer and the locality where the employee works;
• the job function: the profession, position or specific type of work;
• the start date;
• pay terms: salary or tariff rate, additional payments, allowances and incentive payments;
• the term and grounds, if the contract is fixed-term.

Two further terms are included only where they apply: working hours, if they differ from the company’s general schedule, and guarantees for work in conditions that differ from normal ones.

If a mandatory term is missing, the contract is not treated as unconcluded. It must, however, be supplemented by a written supplementary agreement (Labour Code, Art. 104). The same rule applies to missing contract details, which include the employee’s personal identification number (PINFL) and individual accumulative pension account (INPS) number (Labour Code, Art. 107).

Separately, check whether any contract contains terms that put the employee in a worse position than the law provides. Such terms are invalid and do not apply (Labour Code, Arts. 16, 17, 105).

Acknowledgement, hiring documents and the hiring order

Before the contract is signed, the employer must familiarise the person with the content of the job, the working conditions, the ILR, the collective agreement and the internal policies relevant to their work (Labour Code, Art. 123). Employees acknowledge internal policies by signing for them (Labour Code, Art. 25). If the signatures on the acknowledgement sheet are dated after the contract, the procedure needs to be corrected.

The list of documents required at hiring is set by law. It is prohibited to require documents not provided for by the Labour Code or other legislation (Labour Code, Art. 124). Compare your onboarding checklist against this list.

The hiring order is issued on the basis of the contract and must match it. The employee signs to acknowledge the order within three days of actually starting work (Labour Code, Art. 127). A typical mistake is a different position or salary in the order than in the contract.

If you need to hire a new employee rather than review existing records, follow our step-by-step guide to hiring an employee in Uzbekistan.

Probationary period

A probationary period applies only if it is expressly stated in the employment contract. Without such a clause, the employee is deemed hired without probation (Labour Code, Art. 129). A note in the order alone is not enough.

Probation may not exceed three months, or six months for the head of the organisation, their deputies, the chief accountant and the head of a separate subdivision (Labour Code, Art. 130). For some categories, probation cannot be set at all, for example pregnant women, women with a child under three, fathers raising such a child alone, employees under 18, and employees on contracts of up to six months (Labour Code, Art. 129).

The contract may be terminated on the basis of the probation results by notifying the employee in writing at least three days in advance and stating the reasons why they did not pass (Labour Code, Art. 132).

The legal framework is only half the story. For how to use these months so that a new hire genuinely settles in, see SPECTRE’s 90-day onboarding plan.

Fixed-term contracts

A fixed-term contract may be concluded for no more than three years and only on the grounds listed in the Labour Code (Arts. 110, 112, 113). Without such grounds, it is deemed concluded for an indefinite period. The total term, including extensions, may not exceed five years unless otherwise provided by law. In a dispute, the employer must prove that the fixed-term contract was justified (Labour Code, Art. 111). If the contract expires while the employee is pregnant, it is extended at her written request, on presentation of a medical certificate, until the end of the pregnancy or, if she takes maternity leave, until the end of that leave (Labour Code, Art. 408).

What to check: every fixed-term contract has a specific ground under Art. 112 or 113, not simply “by agreement of the parties”.

For details, see our guide on how to hire a foreign employee in Uzbekistan.

UNLS: Registering Contracts, Changes and Terminations

The conclusion, amendment and termination of an employment contract are subject to mandatory registration in the interagency system known as the Unified National Labor System (UNLS; ЕНСТ in Russian) (Labour Code, Arts. 25, 109). The procedure is set out in the Regulation on the UNLS approved by Cabinet of Ministers Resolution No. 971 (the “UNLS Regulation”). All employers must use the UNLS, except those in the state security sector and employers with a classified staffing table (UNLS Regulation, para. 3).

Registration deadlines

 It is best to register supplementary agreements and social leave immediately after signing, rather than waiting for questions.

EDS signature and the responsible person

The employer confirms the data entered for a paper contract with an EDS. If the data is not confirmed with an EDS, the contract is treated as unregistered (UNLS Regulation, para. 26). The same rule applies to supplementary agreements (para. 30). Termination data without an EDS is invalid (para. 37). Entering data without signing it is one of the easiest mistakes to miss.

Every employer other than an individual entrepreneur must appoint, by written decision, the persons responsible for UNLS access (UNLS Regulation, para. 8). If the director’s EDS key is “just with the accountant”, issue an order formally appointing a responsible person.

Positions, structure and prior service

A contract can only be registered against a position entered in the organisational structure (UNLS Regulation, paras. 23–24). For each position, the system records its title under the National Classifier of Occupations, the duties, qualification requirements, working hours and working conditions (para. 22). Check that this data matches the contracts.

The employer is also responsible for transferring to the UNLS the entries from paper employment record books on its employees’ previous jobs. If an electronic request to confirm the length of service of your former employees arrives through the UNLS, you must certify the information with an EDS within ten days (UNLS Regulation, para. 3).

A vacant position for which no contract has been registered within five calendar days is automatically added to the National Vacancy Database (UNLS Regulation, para. 43). Redundant “empty” positions in the structure should be removed or closed.

Records of people who do not work for you

Comparing the UNLS with your headcount sometimes reveals people who have never worked for the company. The Regulation provides that such records may be deleted entirely by the operator on the basis of a conclusion issued by the State Labour Inspectorate (para. 27). If you find such a record, do not correct it yourself: find out how it appeared and consult a lawyer.

Contract Changes and Transfers

How changes are documented

Any change to the employment contract, such as a new position, salary, workplace or working conditions, is documented in two steps (Labour Code, Art. 149):

1. The employee and the employer sign a written supplementary agreement in at least two copies. The employee confirms receipt of their copy by signing.
2. An order is then issued that reproduces the supplementary agreement exactly, and the employee signs to acknowledge it.

The supplementary agreement is then registered in the UNLS. The most common mistake is a promotion or transfer documented only by an order, while the contract and the UNLS record stay unchanged. Working conditions are changed in the same way they were established (Labour Code, Art. 135).

Changes initiated by the employer

Without the employee’s consent, working conditions may be changed only if the previous conditions cannot be maintained because of changes in technology, the organisation of production and work, or a reduction in the volume of work. The employee must be notified in writing, against signature, at least two months in advance. In a dispute, the employer must prove that the previous conditions could not be maintained (Labour Code, Art. 137).

If the change is found unlawful, the employee is entitled to have the previous conditions restored and to be compensated for any loss if their pay was reduced (Labour Code, Art. 150).

Transfers and combining positions

• A permanent transfer to another job is possible only with the employee’s consent (Labour Code, Art. 140).
• A temporary transfer by agreement may last up to one year. If, at the end of that period, the previous job is not provided, the employee does not request it and continues working, the transfer is deemed permanent (Labour Code, Art. 141).
• A temporary transfer at the employer’s initiative without the employee’s consent is allowed only in the event of operational necessity or downtime, and for no more than 60 calendar days in total in a calendar year (Labour Code, Art. 145).
• Combining positions, expanding the service area or covering for an absent employee requires the employee’s consent and additional pay, documented by a supplementary agreement or an order signed by the employee (Labour Code, Arts. 116, 259). Exception: where the duties of an absent employee are assigned to their staff deputy whose job duties provide for this, separate consent and additional pay are not required.

What to check: whether any “temporary” transfers have lasted longer than permitted, and whether any positions are combined without additional pay and written consent.

Termination of Employment: Orders, Notice and Final Settlement

Wording of the order and the role of the ILR

In a dismissal order, the ground must be stated in exact accordance with the wording of the relevant article (or clause) of the Labour Code or another law, with a reference to it (Labour Code, Art. 170). Wording such as “dismissed for breach of discipline” or “by management decision” is not acceptable.

Where dismissal is for a one-off gross breach of duty, the order must also cite the clause of the ILR that names that breach (Labour Code, Art. 170). The list of such breaches is set by the internal labour regulations and, for the head of the organisation, by the employment contract (Labour Code, Art. 162). If your ILR contains no such list, a dismissal for gross breach will be difficult to justify.

Notice periods and prohibitions

Notice periods for termination at the employer’s initiative (Labour Code, Art. 165):

 Notice is given in writing, against signature. The notice period may be replaced by monetary compensation of the corresponding amount.

In cases of redundancy and insufficient qualifications, the employer must first offer the employee other work (Labour Code, Arts. 144, 161). In a redundancy, the preferential right to retain one’s job must be taken into account (Labour Code, Art. 167).

An employer may not dismiss an employee on its own initiative during temporary incapacity for work, leave or a business trip (Labour Code, Art. 163). A pregnant woman may not be dismissed at the employer’s initiative except on liquidation of the organisation or cessation of an IE’s business (Art. 408). A woman with a child under three, or a father raising such a child alone, may be dismissed at the employer’s initiative only on liquidation, or for a systematic or a one-off gross breach of duty (Art. 409). The prohibitions related to illness, leave and business trips do not apply on liquidation of the organisation or cessation of an IE’s business (Art. 163).

An employee resigning of their own accord must give the employer 14 calendar days’ written notice and may withdraw the resignation before that period ends. If the contract has not been terminated when the notice period ends and the person continues to work, the resignation lapses (Labour Code, Art. 160).

Final settlement and documents on the last day

On the day the contract is terminated, the employer must:

• issue the employment record book or an extract from the electronic employment record book, together with a copy of the order (Labour Code, Art. 171);
• pay all amounts due, including compensation for all unused leave (Labour Code, Art. 172);
• pay severance if the termination is on one of the grounds listed in the Labour Code, for example redundancy or liquidation (Labour Code, Art. 173). The minimum amount depends on length of service with the employer: from 50% of average monthly earnings for less than three years’ service to 200% for more than 15 years.

If the employee did not work on the last day, the settlement must be made no later than three days after they request it (Labour Code, Art. 172). The termination must be registered in the UNLS within three working days. The employer bears financial liability to the employee for late payment of wages (Labour Code, Arts. 253, 333).

What an error can cost

If a dismissal is found unlawful, the employee is reinstated and paid for the period of forced absence. Compensation for moral damage is set by the court but may not be less than the employee’s average monthly earnings. Instead of reinstatement, the court may, at the employee’s request, award additional compensation of at least three months’ pay. The burden of proving that the dismissal was lawful lies with the employer (Labour Code, Art. 174).

Documents show how a person left, but not why. If people keep leaving, it is worth understanding why employees leave; SPECTRE has a dedicated guide on this.

Leave, Working Hours and Pay

This part of the audit checks whether actual working hours, rest periods and pay match what is set out in contracts, the ILR and orders. This is where “paper” and “reality” most often diverge.

Leave. What to check:

• annual basic leave of at least 21 calendar days (Labour Code, Art. 217); employees under 18 and employees with Group I or II disabilities are entitled to extended leave of 30 calendar days (Art. 218);
• the leave schedule for the second and subsequent working years has been approved before the start of the calendar year in agreement with the trade union committee, and employees are notified of the start of their leave at least 15 days in advance (Art. 228);
• holiday pay is paid no later than the last working day before the leave begins (Art. 233);
• if leave is split into parts, at least one part is no shorter than 14 calendar days (Art. 231);
• on termination, compensation is paid for all unused leave (Arts. 172, 234).

Working hours. What to check:

• normal working time does not exceed 40 hours a week (Labour Code, Art. 182), and a shift does not exceed 8 hours in a five-day week or 7 hours in a six-day week (Art. 185);
• attendance and departure times are recorded, in timesheets or electronic systems, and overtime is recorded separately (Arts. 190, 200);
• overtime is required only with the employee’s written consent, except in the exceptional cases listed in Art. 189, and for no more than 4 hours over two consecutive days (Arts. 189, 190);
• work on a day off or public holiday is documented by an order, with the employee’s consent confirmed by an application or a signature on the order (Art. 212).

Additional restrictions apply to certain categories: pregnant women, employees under 18, employees with disabilities, and those working in adverse conditions.

Pay for extra hours. The first two hours of overtime are paid at no less than one and a half times the normal rate, and subsequent hours at no less than double. Work on a day off or public holiday is paid at no less than double; at the employee’s request, it may instead be compensated with another day off (Labour Code, Arts. 262, 263).

Wages. Wages are paid at least once every half month, in two instalments: an advance and the balance. Payment dates are set by the collective agreement or an internal policy or, failing these, by the employment contract (Labour Code, Art. 253). The Cabinet of Ministers determines certain categories of employees who may be paid once a month. Check where your payment dates are set out and whether the salaries and allowances in contracts match actual payroll.

We do not cover tax calculations here. See our separate guide on how salary and payroll taxes are calculated.

Internal Policies and Employee Personal Data

Which internal policies to review

Internal policies may not put employees in a worse position than legislation, higher-level collective agreements and the company’s collective agreement provide. Such provisions are invalid (Labour Code, Arts. 8, 13–15, 17). Where the law requires a policy to be agreed with the trade union committee, this is mandatory; where there is no trade union committee, the employer informs the workforce in writing (Labour Code, Art. 15).

It helps to divide the documents into three groups:

 The ILR is an internal policy that governs hiring and dismissal, the rights and obligations of the parties, working hours, rest time, incentives and disciplinary measures. It is approved by the employer in agreement with the trade union committee (Labour Code, Art. 296). Employees are familiarised with the ILR on hiring (Art. 123); the ILR establish working hours (Art. 191) and the list of one-off gross breaches of duty (Art. 162); and the relevant ILR clause is cited in a dismissal order for such a breach (Art. 170). The employer also sets pay and bonus systems in agreement with the trade union committee (Labour Code, Arts. 249, 252), so these should be set out in an internal policy rather than only in individual contracts.

Employee personal data

Information about an employee and their family members obtained in connection with their employment is confidential (Labour Code, Art. 175). The Labour Code sets several rules for employers (Labour Code, Arts. 176, 178):

• obtain personal data from the employee themselves, and from third parties only with the employee’s prior written consent, subject to exceptions provided by law;
• do not disclose data to third parties or use it for commercial purposes without the employee’s written consent, except in cases established by law;
• give access to the data only to specially authorised persons, and only to the extent needed for their work;
• do not request health information other than what relates to the employee’s ability to perform their job function;
• establish a procedure for storing, using and transferring data, and have employees acknowledge it by signing.

Terms in a contract or internal policy under which an employee waives the protection of their data are invalid (Labour Code, Art. 177). If a breach of the data processing procedure deprived an employee of the opportunity to work or reduced their earnings, the employer must compensate the lost earnings (Labour Code, Art. 180).

What to check: where copies of passports, diplomas and medical certificates are kept, who has access to them, whether they are shared in group chats, and whether data is passed to contractors and on what basis. Besides the Labour Code, the processing of personal data is governed by a separate law, whose requirements are worth reviewing with a lawyer.

Common Compliance Gaps and How to Fix Them

The table below lists the errors most often found in an HR compliance audit. The “Possible risk” column shows consequences expressly provided for by the Labour Code and the UNLS Regulation.

HR Compliance Self-Audit Checklist

Answer “yes” or “no” to each question. A “no” is a reason to look more closely at that item. It does not mean a breach has been established.

Contracts and hiring

• Everyone working on a regular basis has an employment contract, not a civil-law contract
  
• No one has worked for more than three days without a contract and an order
  
• Every contract states the place of work, job function, start date and pay terms
  
• Contracts include the employee’s PINFL and individual accumulative pension account (INPS) number
  
• The contract has been signed in at least two copies, and the employee’s receipt of their copy is confirmed by signature
  
• The employee acknowledged the ILR and internal policies by signing before the contract was signed
  
• The hiring order matches the contract and has been signed by the employee
  
• Any probationary period is stated in the contract itself, does not exceed the legal maximum and has not been set for anyone exempt from probation
  
• Every fixed-term contract has a specific ground under the Labour Code
  

UNLS

• A responsible person has been appointed by written decision (for organisations)
  
• Every paper contract was registered within 5 working days and confirmed with an EDS
  
• All supplementary agreements are registered and confirmed with an EDS
  
• Every termination was registered within 3 working days
  
• The UNLS employee list matches actual headcount and payroll
  
• Positions and terms in the UNLS match the contracts
  
• The UNLS contains no records of people who do not work for the company
  

Changes and transfers

• Every change to terms is documented by a supplementary agreement and an order
  
• No temporary transfer has exceeded its permitted period
  
• Combined positions are documented and paid
  

Terminations

• Dismissal orders state the ground exactly as worded in the Labour Code
  
• The list of one-off gross breaches of duty is set out in the ILR
  
• Employees receive written notice within the required periods
  
• The final settlement, the employment record book or extract, and a copy of the order are issued on the last day
  

Leave, working hours and pay

• Annual basic leave is at least 21 calendar days
  
• The leave schedule is approved before the start of the year, and employees are notified at least 15 days in advance
  
• Holiday pay is paid no later than the last working day before the leave
  
• Actual working hours match the ILR and contracts, and the working week does not exceed 40 hours
  
• Attendance and departure are recorded, and overtime is recorded separately
  
• Overtime is worked only with written consent, for no more than 4 hours over two consecutive days, and at an increased rate
  
• Work on days off is documented by an order with the employee’s consent and paid at no less than double, or compensated with another day off
  
• Wages are paid at least every half month, and payment dates are set out in documents
  
• Actual payroll matches the salaries and allowances in contracts
  

Internal policies and personal data

• Internal policies contain no terms worse than the law
  
• There is a policy on processing personal data, and employees have acknowledged it by signing
  
• Only authorised persons have access to personal data
  
• Data is not passed to third parties without the employee’s written consent
  

What to Fix First

Once you have a list of gaps, prioritise them. We recommend the following order.

1. Undocumented and unregistered relationships. People without contracts, civil-law contracts used instead of employment contracts, and UNLS contracts without an EDS signature. These errors affect the very existence of the employment relationship, so they are fixed first.
2. Anything affecting dismissals and settlements. Wording of orders, the list of gross breaches in the ILR, notices, final settlement on the last day, and unjustified fixed-term contracts. This is especially urgent if dismissals or redundancies are planned soon.
3. Order and documents for the future. Supplementary agreements for past changes, acknowledgement sheets, internal policies, the personal data policy and order templates.

Correcting past errors is a delicate task. We do not recommend simply “reprinting” documents with backdated dates: it is easy to replace an old problem with a new one. How to correct each specific case is best decided together with a lawyer.

In-House Review or Legal Support?

You can carry out an initial review in-house using the checklist. In some situations, however, it is worth bringing in a specialist straight away.

 A lawyer looks at documents differently from an HR officer. Their job is not only to find a mismatch but also to assess what consequences it may have and how to correct it without creating new risks.

Conclusion

An HR compliance audit checks whether contracts, orders, UNLS records and actual work all tell the same story. Most risks arise not from complex legal issues but from small things: a record not signed with an EDS, a change made without a supplementary agreement, an order with imprecise wording. A regular review against the checklist lets you find them before someone else does.