Outsourcing (Outstaffing) in Uzbekistan

The development of the labor market in the context of globalization requires the search for new forms of employment that ensure a balance of interests between employers and employees. One such tool is outstaffing — the temporary provision of personnel to another organization.

In Uzbekistan, the legal framework for this institution is enshrined in the Law “On Employment of the Population”, and in 2024 an important subordinate act was adopted — Resolution of the Cabinet of Ministers No. 706 of October 25, 2024, which approved the Regulation on the procedure for providing outstaffing services.

The Resolution was adopted in pursuance of:

• Article 16 of the Law of the Republic of Uzbekistan “On Employment of the Population”;
• Presidential Decree No. PF-37 of February 21, 2024 “On measures for the implementation of the Strategy Uzbekistan — 2030 in the Year of Support for Youth and Business.”

Thus, the act logically continues the strategy for the development of employment and entrepreneurship.

Key Concepts and Participants

The Regulation establishes the following categories:

• Outstaffer — a legal entity that concludes an agreement with the host organization and sends its employees.
• Host organization — a legal entity that temporarily uses the labor of assigned employees.
• Assigned employee — an employee of the outstaffer who has agreed to work in another organization under its management.

Outstaffing is defined as a service for the temporary assignment of employees to perform work functions while maintaining the employment contract with the outstaffer.

Content of the Outstaffing Agreement

The Resolution regulates the structure and mandatory terms of the agreement:

• Obligations of the outstaffer: conclusion of employment contracts, payment of wages, liability insurance, observance of guarantees and benefits.
• Obligations of the host organization: provision of working conditions, occupational safety briefings, provision of equipment, monitoring compliance with labor standards.
• Financial terms: payment for services, including wages, compensation, and the entrepreneurial income of the outstaffer.

Special attention is paid to the subsidiary liability of the host organization for the payment of wages and compensation in case of violations.

Restrictions and Prohibitions

The act establishes areas where outstaffing is not allowed:

• work at hazardous industrial facilities;
• in conditions of mass layoffs;
• during insolvency proceedings.

The period of employee assignment is limited to nine months per calendar year, with the possibility of extension by agreement of the parties.

Regulation of Labor Relations

Labor relations between the outstaffer and the assigned employee remain in force. At the same time:

• equality of working conditions and pay with employees of the host organization performing similar functions is guaranteed;
• work experience and employment periods are recorded in the employment record book (including electronic records);
• all information about employees must be entered into the Unified National Labor System.

These provisions strengthen the protection of employees’ rights and ensure transparency of procedures.

Control and Liability

The functions of control are assigned to the Ministry for Poverty Reduction and Employment, which ensures registration and supervision of compliance with the rules. Violation of the requirements entails legal liability under current legislation.

Scientific and Practical Significance

Resolution No. 706 has significant importance for legal science and practice:

• it establishes a new employment institution ensuring labor market flexibility;
• introduces a clear mechanism for the division of responsibilities between parties;
• protects the interests of employees through a system of guarantees and restrictions;
• creates conditions for the development of entrepreneurship and youth employment support.

The legal regulation of outstaffing in Uzbekistan demonstrates the state’s commitment to introducing modern mechanisms of employment. Resolution No. 706 of the Cabinet of Ministers forms a comprehensive system that considers the interests of all participants: the state, employers, and employees. In the future, this institution may contribute to reducing unemployment, increasing labor market flexibility, and enhancing the country’s investment attractiveness.

Duties and Responsibilities of the Parties

1. Obligations of the Outstaffer

Category	Main Obligations
Employment Relations	Conclusion of employment contracts with employees, obtaining written consent for assignment to another organization
Remuneration	Timely payment of wages, vacation pay, and temporary disability benefits
Social Guarantees	Provision of benefits established by law and collective agreements
Insurance	Mandatory liability insurance of the employer for accidents and occupational diseases
Rights Compliance	Provision of rest, occupational safety, non-discrimination, confidentiality of host organization data

 

2. Obligations of the Host Organization

Category	Main Obligations
Work Organization	Provision of workplaces, control over compliance with work schedules
Occupational Safety	Conducting briefings, providing protective equipment, compliance with labor and fire safety rules
Working Conditions	Provision of equipment, tools, and technical documentation
Work Management	Supervision of assigned employees, monitoring of working time
Liability	Subsidiary liability for payments (wages, compensation for injuries, benefits, etc.)

 

3. Obligations of the Assigned Employee

Category	Main Obligations
Work Functions	Fulfillment of duties determined by the employment contract and the outstaffing agreement
Compliance with Rules	Following internal labor regulations of the host organization
Occupational Safety	Observance of occupational safety, fire safety, and production discipline
Liability	Personal responsibility for proper performance of duties and observance of discipline

 

4. Liability of the Parties

Party	Grounds for Liability
Outstaffer	Violations of payments, lack of insurance, violation of guarantees and benefits
Host Organization	Non-compliance with labor safety rules, provision of improper working conditions, refusal of subsidiary payments
Employee	Violation of labor discipline, safety rules, refusal to perform duties

Balance of Interests

• The outstaffer retains the status of employer and is responsible for wages and social guarantees.
• The host organization is responsible for working conditions and bears subsidiary liability.
• The employee retains employment status and must comply with the rules of both parties.