Jan 10 2025

Amendments to the Labor Code of Armenia

Despite strong reservations from both business associations and trade unions, the parliament adopted amendments to the Labor Code of Armenia, which are designed to introduce an electronic platform for signing employment contracts. A new centralized online system (expected to be integrated in the current tax reporting systems) will have to be used to sign, amend and terminate employment contracts. Moreover, information about all employment contracts signed before launch of the system will have to be uploaded into the system. The system is set to become operational from July 2025 (as optional and then become mandatory from June 2026. Overall, our assessment is that the amendments will pose more challenges than benefits, and they will at least:

• Complicate the signing of non-standard employment agreements.
• Create an additional compliance cost burden for investors and employers, forcing the latter to input information about hundreds of thousands of current employees (despite the fact that most essential part of this information is already submitted to the state via tax reports);
• Complicate the signing of employment agreements with employees who have limited access to technology or lack technological skills.