Picture this: a country with a 99.8% literacy rate, sitting at the crossroads of Europe and Asia, training 100,000 IT specialists by 2025. That country is Kazakhstan. Right now, it represents one of the most underestimated talent pools for companies building distributed teams.
According to Vladimir Norov, an expert on the EU, China, and Central Asia, Kazakhstan’s IT sector is writing one of the most impressive growth stories in the region. In 2024, the country’s IT sector generated 1.2 trillion tenge (approximately US $2.2 billion) in revenue.
With over 18,600 registered IT companies (Astana Hub alone hosts over 1,700 tech companies), Kazakhstan has attracted $624 million in investments since 2018. The government has pushed digital transformation so aggressively that digital banking usage jumped from 25% in 2018 to nearly 100% in 2024. This has created a workforce that understands modern systems and remote collaboration.
Remote work culture has taken root here in ways that feel natural rather than forced. Professionals in Kazakhstan work across multiple time zones and bridge Eastern European and Asian markets with ease. For companies seeking talent that combines technical skill with cost efficiency and cultural adaptability, hiring in Kazakhstan offers something rare: a growing ecosystem that still flies under the radar of most global employers.
Kazakhstan’s labor market
Here’s what the numbers look like right now. Kazakhstan’s unemployment rate sits at 4.6% as of Q2 2025. That’s the lowest it has been since tracking began in 2001. The country employs 9.3 million people, with 7.1 million as hired workers and 2.1 million self-employed.
But the surface numbers hide some texture underneath. About 30% of employed people operate outside the formal pension system. Traditional sectors dominate: trade employs 17% of workers, education 13.4%, industry 12.5%, and agriculture 10.3%. This reflects an economy still anchored in services rather than high-value tech or export industries. Youth unemployment stands at just 3.1%, yet only 323,700 people are registered with government job centers, suggesting many job seekers bypass official channels entirely.
The tech sector tells a different story. As of June 2025, Kazakhstan has 19,500 officially registered programmers, developers, and AI specialists. That number tripled since 2020 and excludes in-house IT staff working across industries like energy and finance. The government is betting big on digital. President Tokayev announced plans to transform Kazakhstan into a fully digital state by 2028, with a new Ministry of AI and Digital Development driving the agenda.
The wage dynamics reveal where the momentum is building. Information and communication workers saw 24% wage growth year-over-year, now averaging 819,916 tenge monthly (US$1,500). Machine learning engineers top out at US$2,900 per month, while data scientists earn around US$2,000. For context, a mid-level software engineer in Kazakhstan costs a fraction of what the same role commands in Berlin or San Francisco while maintaining comparable technical skills.
Digital infrastructure has matured faster than most observers expected. Kazakhstan ranked 34th out of 69 countries in the IMD World Digital Competitiveness Ranking 2025. The number of fintech startups quadrupled from 50 in 2018 to 200 in 2024, with 89% of transactions now processed digitally. This creates a workforce that already operates in digital-first environments and understands remote collaboration tools instinctively.
How to hire employees in Kazakhstan
Once you decide Kazakhstan makes sense for your team, there’s still the question of how to actually put them on payroll when your company has no legal presence there. Foreign employers have two primary pathways: establishing a local entity or partnering with an employer of record (EOR).
Setting up a local entity
The traditional route involves registering a legal entity in Kazakhstan. This means forming a subsidiary, registering with tax authorities, opening local bank accounts, and building out HR infrastructure from scratch. The process typically takes several months and requires ongoing administrative resources to maintain compliance with the country’s labor laws, tax filings, and statutory reporting requirements.
Hiring through an employer of record
An EOR in Kazakhstan acts as the legal employer on paper while the hiring company retains full operational control over employees. The EOR handles employment contracts, payroll processing, tax withholdings, statutory benefits, and compliance with Kazakhstan labor law. The employee works for the client company on a day-to-day basis, but the EOR manages all the legal and administrative processes behind the scenes.
For businesses hiring their first employees in Kazakhstan or running temporary projects, an EOR provides speed and flexibility without the overhead of entity formation.
Employment contracts in Kazakhstan
Employment contracts in Kazakhstan must be written out. It’s the law. The contract needs to be drafted in either Kazakh or Russian, the country’s official languages. English versions carry no legal weight on their own.
The contract must spell out specifics like job description, salary, benefits, start date, working conditions, and termination procedures.. Employers must register employees with the State Revenue Committee for tax purposes and with the Ministry of Labor and Social Protection for social security. Foreign nationals add another wrinkle: they need work permits before signing contracts, and those permits come in different categories based on qualifications and transfer type.
Recent changes have tightened the process significantly. As of September 2025, employers must post vacancies on Kazakhstan’s electronic labor exchange and wait 15 days before hiring foreign workers. All employment contracts with foreign employees now require registration in the Unified Labor Contract Registration System. The government automated verification across multiple databases to ensure compliance, checking migration status and contract registration simultaneously.
Working hours, holidays, and leave
The standard workweek in Kazakhstan runs 40 hours, typically spread across five days. Night shifts (10 p.m. to 6 a.m.) cannot exceed seven hours per shift. Overtime is allowed, but it’s capped at two hours per day and 120 hours annually.
Kazakhstan observes 10 public holidays each year. Employees earn paid annual leave starting at 24 calendar days, with specific categories of workers entitled to extended leave periods. Sick leave operates on a tiered system. The first 15 days of illness are covered by the employer at 80% of the average earnings, while the Social Insurance Fund takes over after that.
Parental leave provisions are generous compared to many markets. Women receive 126 calendar days of maternity leave, with payments covered through social insurance. Fathers can take 15 calendar days of paternity leave. Both parents have the right to additional unpaid parental leave until the child turns three.
Employee benefits and social contributions
Here’s where the cost structure beyond salary becomes clear. Employers in Kazakhstan carry mandatory social contribution obligations that add roughly 16% to gross payroll costs. These aren’t optional; they are statutory requirements that fund the country’s social safety net.
Kazakhstan’s tax contribution breakdown looks like this:
- Pension contributions. 10% of gross salary paid by the employer
- Social insurance. 3.5% for workplace injury and illness coverage
- Health insurance. 2% toward mandatory medical coverage
- Compulsory social medical insurance. 2% additional contribution
Employees also contribute from their own salaries. They pay 10% toward their individual pension accounts and 2% for social tax. The total employment cost calculation needs to account for both employer and employee contributions when budgeting international hires.
Beyond statutory minimums, many employers in the tech sector offer supplemental benefits to compete for talent. These often include private health insurance, meal allowances, transportation stipends, and professional development budgets. The rising competition for skilled developers has pushed benefits packages upward, particularly in Almaty and Astana where most tech companies concentrate.
Payroll and taxation in Kazakhstan
Payroll in Kazakhstan follows a monthly cycle. Salaries must be paid at least once per month, no later than the 10th day of the following month. The exact payment date needs to be specified in the employment contract. Late payments trigger penalties and can expose employers to labor disputes.
Personal income tax operates on a flat rate system. Residents pay 10% on their income, while non-residents face a 20% rate. Residency status depends on physical presence: individuals spending 183 days or greater in Kazakhstan during a calendar year qualify as tax residents. This threshold matters significantly for remote workers who split time across multiple countries.
Corporate tax for entities operating in Kazakhstan sits at 20% of taxable income. However, companies registered with Astana Hub enjoy preferential treatment. They receive full corporate income tax exemption, along with zero-rate land tax, property tax, and VAT exemptions on certain transactions. This creates substantial savings for tech companies willing to establish presence through the technopark structure. The government designed these incentives specifically to attract international companies and build the digital economy ecosystem.
Employee vs. contractor classification
The line between employee and contractor in Kazakhstan carries real legal weight. Tax authorities examine the substance of the relationship, not just what the contract says. Get it wrong and the penalties stack up: back taxes, social contributions, fines, and potential lawsuits from workers seeking employee benefits.
Kazakhstan courts look at several factors to determine classification. Does the company control how, when, and where work gets done? That points toward employment. Is the worker integrated into core business operations? Another employee indicator.
Financial dependence matters too. If the worker relies on one client for most of their income and works exclusively for that client, authorities will likely reclassify them as an employee regardless of contract language.
Contractors need genuine independence to avoid reclassification. They should use their own tools, maintain multiple clients, invoice for specific deliverables rather than receive regular salaries, and control their own methods and schedules. The contract must explicitly state that it’s a service agreement, that the contractor handles their own taxes, and that intellectual property ownership transfers to the client only if specified.
Half measures invite scrutiny. Companies that hire what look like full-time remote employees but call them contractors to dodge payroll obligations are playing a risky game.
Termination and severance in Kazakhstan
There are strict procedural requirements to end employment in Kazakhstan. Employers cannot simply let people go without documented cause or proper notice. The Labor Code specifies valid termination grounds, and authorities take violations seriously.
Employers must provide one month’s written notice before terminating an employee without cause unless the employment contract or collective agreement stipulates a longer period.
Employers terminating for cause still need to document the reasons carefully. Valid grounds include repeated failure to perform duties after prior disciplinary action, committing actions incompatible with the role, or extended absence due to illness or injury beyond two months (with exceptions for maternity leave and certain diseases). Terminating someone for discriminatory reasons or in retaliation for protected activity opens employers to legal claims.
Severance obligations vary based on termination circumstances. When employers initiate termination without employee fault (such as redundancy or organizational restructuring), they typically owe severance equal to one month’s average salary. Probationary periods max out at three months for most positions, extending to six months only for executive roles like chief executives, chief accountants, and branch heads. During probation, either party can terminate with three working days’ notice.
Work permits and immigration
Hiring foreign nationals in Kazakhstan requires navigating a work permit system that tightened considerably in 2025. The government automated verification and added new procedural hurdles designed to prioritize local workers.
All employment contracts with foreign employees require registration in the Unified Labor Contract Registration System, which cross-checks migration status and contract details across government databases. The system flags inconsistencies automatically, making it harder to bypass compliance requirements.
Work permits come in different legal frameworks:
- M1 permits for highly qualified specialists transferred by their employer
- M2 permits for foreign workers hired locally in Kazakhstan
- M3 permits for workers who must travel to Kazakhstan to obtain the permit
- M4 permits for business immigrants establishing companies
- M5 permits for seasonal workers in specific industries
Processing times vary, but employers should expect several weeks minimum. Foreign workers cannot legally start employment until work permits are approved and registered. The employer serves as the permit sponsor and bears responsibility for compliance throughout the worker’s tenure.
FAQs: Hiring in Kazakhstan
What is the work culture in Kazakhstan?
Think hierarchy meets hospitality. Kazakhstani professionals respect seniority and formal structure, but relationships matter just as much as org charts. Meetings often start with tea and conversation about families before anyone opens a laptop. Trust builds through face-to-face interactions, not email chains. The workforce blends Soviet-era formality with a growing tech culture that values innovation and speed.
Can I hire in Kazakhstan without establishing a local entity?
Yes, and it happens all the time by using an employer of record. The EOR becomes the legal employer while the employee reports directly to your team. No subsidiary registration, no local tax filings, no months of bureaucratic setup. You get the talent. The EOR handles the paperwork.
What jobs are in demand in Kazakhstan?
Tech roles dominate. Software engineers, data scientists, machine learning specialists, IT project managers. Demand pushed IT salaries up 40% between 2021 and 2024. Machine learning engineers can pull $2,900 monthly, while data scientists average around $2,000. The government’s digital transformation push keeps creating new roles faster than universities can fill them.
What is the minimum wage in Kazakhstan?
The official minimum sits at 85,000 tenge per month, roughly US$185. But that number mostly applies to entry-level service positions. Professional roles in tech, finance, and specialized sectors command market rates that reflect actual talent competition. The minimum wage serves as a regulatory baseline, not a realistic benchmark for hiring skilled workers.
Ready to hire in Kazakhstan?
So you want to hire in Kazakhstan, but you don’t know where to start. You could begin by tracking down the legal experts required to set up a local entity, source talent, check and recheck the laws, regulations, and stipulations…
Or you could partner with Pebl and let us handle it.
We offer employer of record services in 185+ countries worldwide, including Kazakhstan. Our team manages employment contracts, payroll, benefits, tax compliance, and local labor law requirements so you can onboard talent in weeks instead of months. No entity setup required, no bureaucratic maze to navigate. Just a single solution that lets you hire the people you need while we handle everything that makes global employment complicated. Contact us to learn more.
This information does not, and is not intended to, constitute legal or tax advice and is for general informational purposes only. The intent of this document is solely to provide general and preliminary information for private use. Do not rely on it as an alternative to legal, financial, taxation, or accountancy advice from an appropriately qualified professional. The content in this guide is provided “as is,” and no representations are made that the content is error-free.
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