Partial unemployment assistance for employees and sole proprietors: conditions, amount, and application procedure

Partial unemployment assistance is intended for situations where a business does not cease operations completely but temporarily reduces its activities due to economic or technological reasons, an emergency, martial law, a state of emergency, or quarantine. As a result, employees work fewer hours and lose part of their wages, while Sole Proprietorship owners lose part of their income. Employees receive payments through their employer, while insured Sole Proprietorship owners receive payments directly from the regional employment center.

For employers, the main requirement is a reduction in operations affecting at least 20% of employees, with each affected employee experiencing a reduction of at least 30% in both working hours and wages per month. For Sole Proprietorship owners, both working hours and income must decrease by at least 30%. Applications must be submitted within 90 calendar days from the start of the reduction. Assistance may be paid for a total of no more than 180 calendar days within 36 months. The maximum amount per person in 2026 is UAH 4,323.50 per month.

What Is Partial Unemployment Assistance?

Article 47 of the Law of Ukraine «On Employment of the Population» defines partial unemployment assistance as state support for insured persons — employees and Sole Proprietorship owners — who have lost part of their wages or income due to the suspension or reduction of production, performance of work, or provision of services. Reasons for such reductions may include:

• economic reasons;

• technological reasons;

• an emergency;

• the introduction of a state of emergency;

• the introduction of martial law;

• the introduction of quarantine.

This is not ordinary unemployment benefit. Employees remain in an employment relationship, while Sole Proprietorship owners continue their business activities. The purpose of the payment is specifically to compensate for part of the income lost because of a temporary reduction in work.

The mere existence of martial law does not automatically create entitlement to assistance. There must be an actual reduction in business activity, and the quantitative criteria established by Procedure No. 702 must be met. Martial law remains in effect in Ukraine.

Who Can Receive Partial Unemployment Assistance?

Two main categories of insured persons are eligible for assistance.

A Sole Proprietorship owner with employees may submit applications both for their employees and for themselves. However, a Sole Proprietorship owner cannot receive assistance in their capacity as an entrepreneur if they are already receiving partial unemployment assistance as an employee.

Assistance is not provided to employees of:

• state authorities;

• local government bodies;

• establishments, institutions, and organizations established by such bodies if they are fully funded by the state or local budget.

What Requirements Must an Employer Meet?

To obtain assistance for employees, all the criteria established in paragraph 6 of Procedure No. 702 must be met simultaneously.

1. The Reduction Must Affect at Least 20% of Employees

At least 20% of the employer's workforce must experience simultaneous reductions resulting from reduced business activity in:

• working hours — by 30% or more per month;

• wages — by 30% or more per month.

For example, if a company employs 50 people, the reduction must affect at least 10 employees. For each of them, reducing working hours alone is insufficient: wages must also decrease by at least 30%.

2. Unified Social Contributions Must Have Been Paid for the Employee

For each employee for whom the employer requests assistance, the Unified Social Contribution (USC) must have been paid during the last six months preceding the month in which the reduction in activity began.

If legislation allowed certain employers not to pay USC during the relevant period, the preceding 180 calendar days before that exemption period are used to verify compliance with this requirement.

3. There Must Be No Outstanding Debts Specified by the Procedure

The following conditions must be met:

• no outstanding wage arrears;

• no outstanding USC arrears;

• no outstanding mandatory state pension insurance contributions during the six months preceding the month in which activity was reduced;

• no debts to the state or local budget that have remained outstanding for more than six months before the month in which the reduction began.

In addition, the employer must not be a compulsory state social insurance fund.

Eligibility Requirements for Sole Proprietorship Owners

A Sole Proprietorship owner applying for assistance on their own behalf must be an insured person.

The main quantitative requirement for Sole Proprietorship owners is a simultaneous monthly reduction in:

• working hours — by 30% or more;

• income — by 30% or more.

Requirements concerning USC payments for the previous six months and the absence of debts specified by the Procedure also apply.

Assistance cannot be obtained if the Sole Proprietorship owner is in the process of terminating business activities, has been declared bankrupt, is subject to bankruptcy, liquidation, or rehabilitation proceedings, or has other insolvency-related circumstances expressly specified in paragraph 7 of Procedure No. 702.

When Assistance Will Not Be Granted

Grounds for refusal relate both to the nature of the reduction in business activity and to the status of the employer, Sole Proprietorship owner, or individual employee.

Assistance is not granted if:

• the reduction is seasonal;

• the reduction is caused exclusively by organizational or production-related reasons;

• the employee refuses suitable temporary full-time work offered by the employer;

• the employee works for the employer on a secondary-employment basis;

• the employee performs alternative (non-military) service;

• USC payment requirements have not been met;

• there are outstanding debts that prevent eligibility for assistance;

• the employer or Sole Proprietorship owner is undergoing termination, bankruptcy, liquidation, rehabilitation, or other insolvency proceedings specified by the Procedure;

• the employer is a fully budget-funded state or municipal institution or organization covered by the relevant exclusion.

In addition, assistance is not paid to an individual employee for periods of:

• paid downtime;

• unpaid leave;

• suspension of the employment relationship.

Therefore, downtime payments and partial unemployment assistance cannot be used as two parallel compensation mechanisms for the same employee over the same period.

Special Rules on State Aid During Martial Law

Procedure No. 702 contains provisions concerning the maximum amount of de minimis state aid, information about business activities, and state aid received. However, paragraph 27-1 of the Procedure expressly provides that the following provisions do not apply during martial law:

• the sixth paragraph of paragraph 7;

• the eleventh paragraph of paragraph 9;

• the fourth and fifth paragraphs of paragraph 14;

• the third and fourth paragraphs of paragraph 20.

Accordingly, while martial law is in effect, the limit on the aggregate amount of de minimis state aid established by these provisions does not apply. The information about business activities and de minimis state aid specified in the relevant paragraphs is also not required. After martial law ends or is lifted, the version of the Procedure in effect at the time of application must be followed.

How to Properly Document Reduced Employee Working Hours

Receiving funds from an employment center does not replace the need to properly document employees' working arrangements.

Article 56 of the Labor Code of Ukraine allows an employee and employer, by mutual agreement, to establish a part-time working day, a part-time working week, or a combination of both. In this case, payment is proportional to the hours worked or based on output.

Employers should have documents that clearly establish:

• the date on which the reduction in business activity began;

• the reason for the reduction;

• the employees affected;

• their normal working hours;

• the actual duration of work;

• the number of hours reduced;

• wage amounts before and after the reduction.

This information is necessary not only for calculating assistance but also for subsequent inspections by the employment center.

Amount of Partial Unemployment Assistance

Procedure No. 702 establishes one formula for employees and Sole Proprietorship owners:

PUA = (CI / NWH) × RH

where:

• PUA — assistance payable to an individual employee or Sole Proprietorship owner for the relevant month;

• CI — calculated income;

• NWH — the number of normal working hours for the relevant month;

• RH — the number of working hours by which the schedule was reduced.

For an employee, CI is the applicable wage rate or official monthly salary. If a non-tariff remuneration system is used, it is the average wage.

For a Sole Proprietorship owner, the calculation is based on the average monthly USC assessment base for the year preceding the application year. The Procedure also separately regulates how to determine the base for a Sole Proprietorship owner who has no corresponding assessment base for the previous year.

Important: the formula uses the number of reduced hours, not the hours actually worked.

Maximum Assistance Amount

Monthly assistance for one employee or Sole Proprietorship owner may not exceed 50% of the minimum wage.

The minimum wage in 2026 is UAH 8,647 per month. Therefore:

UAH 8,647 × 50% = UAH 4,323.50.

The maximum partial unemployment assistance is UAH 4,323.50 per person per month.

The hourly minimum wage, which is UAH 52 in 2026, is not used to determine this limit. The Procedure sets the maximum specifically at 50% of the monthly minimum wage.

Calculation Example

An employee has an official monthly salary of UAH 20,000. Normal working hours in the relevant month amount to 176 hours, but the employee did not work 64 hours because of reduced business activity.

The calculated amount is:

20,000 / 176 × 64 = UAH 7,272.73.

Because this exceeds the established maximum, no more than UAH 4,323.50 may be funded for this employee for the month.

How Long Is Assistance Paid?

Assistance is paid from the first day of reduced working hours within the period of reduced business activity.

The total duration is no more than 180 calendar days in aggregate within 36 months from the date the reduction began.

If an employer or Sole Proprietorship owner reapplies within those 36 months, only the unused portion of the 180 calendar days may be claimed.

For example, if assistance has already been paid for 120 calendar days, the maximum remaining entitlement upon reapplication within the same 36-month period is 60 calendar days.

Where and When to Apply

The employer, an authorized representative, or an insured Sole Proprietorship owner submits an application to the employment center located at the place where business activities are conducted.

The deadline is 90 calendar days from the date on which business activities were suspended or reduced.

Applications may be submitted in one of two ways:

1. in person at an employment center;

2. through the Unified State Web Portal of Electronic Services, «Diia», provided the necessary technical functionality is available.

To apply through Diia, applicants must have an electronic account and complete the required electronic identification process. Documents are signed with a qualified electronic signature or an advanced electronic signature permitted by the Procedure, including «Diia.Signature».

The current version of Procedure No. 702 does not provide for submitting an application by ordinary email.

What Documents Must an Employer Submit?

The employer attaches the following to the application:

• information about employees who have become eligible for assistance — Appendix 1 to Procedure No. 702.

The employment service obtains information on USC payments and tax debts through data exchange with the State Tax Service and the Pension Fund.

If the necessary information is unavailable in state information systems, the applicant submits an extract from the State Tax Service information system showing the status of settlements with the budget and designated funds.

Procedure No. 702 does not list a copy of an order suspending or reducing business activities or a separate paper certificate confirming USC payments among the mandatory documents for the initial application. However, internal documents concerning working arrangements and actual working hours must be retained because the employment center has the right to inspect the documents and information on which assistance was granted.

What Documents Must a Sole Proprietorship Owner Submit?

An insured Sole Proprietorship owner applying for assistance on their own behalf submits:

• an application;

• personal information in the form specified in Appendix 2 to Procedure No. 702.

If a Sole Proprietorship owner applies both for themselves and for their employees, the following must be submitted:

• Appendix 1 — for employees;

• Appendix 2 — for the Sole Proprietorship owner.

Information on USC payments and tax debts is also checked through state information systems. An extract from the State Tax Service is required only if the necessary information is unavailable through automated data exchange.

How the Employment Center Reviews an Application

The regional employment center decides whether to grant or refuse assistance within five working days from the date on which the documents required by the Procedure are submitted. The decision is formalized by an order.

The applicant is informed of the decision within three working days from the date it is made, using the communication method specified in the application. If assistance is refused, the reasons must be provided.

If the Application Contains Deficiencies

Following amendments introduced by Cabinet of Ministers Resolution No. 923, paragraph 14-1 of Procedure No. 702 provides for a procedure under which an application may be left pending without further consideration until deficiencies are corrected.

If an application is submitted in violation of the requirements of paragraphs 13 and 14, the employment center sends the employer a notification within three working days. For applications submitted in person, the notification is provided immediately where possible.

The notification must specify:

• the specific deficiencies;

• the legal requirements that have been violated;

• how to correct the deficiencies;

• the deadline for correction;

• the procedure and deadlines for appeals.

The period allowed for correcting deficiencies may not be shorter than three working days from receipt of the notification. At the employer's request, the employment center may extend it to five working days.

If deficiencies are corrected within the specified period, the application is considered submitted on its original submission date. The review period is extended by the time during which the application remained pending. An application cannot be left pending again because of deficiencies that have already been corrected.

Paragraph 14-1 is worded specifically in relation to employers. For both employers and Sole Proprietorship owners, paragraph 17 of the Procedure also provides the right to correct incomplete or erroneous documents and reapply within the period established by that paragraph.

A refusal decision may be appealed administratively under the Law of Ukraine «On Administrative Procedure» and/or before an administrative court.

What Must Be Submitted Monthly After Assistance Is Approved?

A positive decision alone does not result in the automatic transfer of the entire amount for the whole period.

Each month, by the 10th for the preceding month, the following must be submitted:

This information is submitted according to the document submission rules established in paragraph 13 of the Procedure.

During martial law, the additional monthly information about business activities and de minimis state aid provided for in the third and fourth paragraphs of paragraph 20 is not submitted because paragraph 27-1 of the Procedure applies.

When Are Funds Transferred?

The regional employment center transfers funds to the Sole Proprietorship owner or employer monthly within three working days after the corresponding funds have been credited to the regional employment center's account. Therefore, these three days are calculated not from the date on which the employer submits monthly information but from the date on which funding reaches the regional center.

If discrepancies are found between the submitted data and the register of insurers or the register of insured persons, the transfer period may be extended to resolve them — up to five working days from receipt of the employment center's notification.

How Employers Pay Assistance to Employees

After receiving the funds, the employer must pay them to employees no later than three working days.

Payment is documented using a separate:

• payroll statement for partial unemployment assistance; or

• cash payment statement.

Therefore, Procedure No. 702 does not prohibit paying this assistance in cash.

Within five calendar days after payment, the employer must submit a copy of the relevant statement to the employment center:

• with confirmation of cashless transfers to employees; or

• a cash payment statement.

What Employment Guarantees Must Be Maintained After Receiving Assistance?

Receiving assistance creates an additional obligation for employers and Sole Proprietorship owners to preserve employment.

If assistance was paid for 180 calendar days, the guarantees must be maintained throughout that period and for a further 180 calendar days after the payments end.

If assistance was paid for a shorter period, such as 90 calendar days, the corresponding post-payment guarantee period is also 90 days.

The employer must repay to the Fund the entire amount of assistance paid to a particular employee if, during the guarantee period, the employee's employment contract is terminated:

• by mutual agreement of the parties — paragraph 1 of Article 36 of the Labor Code of Ukraine;

• at the employee's initiative because the employer failed to comply with labor legislation or the terms of a collective or employment agreement — Part 3 of Article 38 of the Labor Code of Ukraine;

• at the employer's initiative due to changes in the organization of production and labor, including reductions in employee numbers or positions — paragraph 1 of Part 1 of Article 40 of the Labor Code of Ukraine.

A Sole Proprietorship owner who received assistance for themselves and terminated their business activities during the relevant guarantee period after payments ended must also repay all assistance received.

Therefore, before dismissing an employee who received this assistance, an employer should verify the grounds for dismissal and the date on which the guarantee period ends.

When Must the Funds Received Be Repaid?

In addition to violations of employment guarantees, repayment is required in cases involving:

• submission of false documents or information;

• use of Fund resources for purposes other than those intended;

• use of funds in violation of Procedure No. 702;

• receipt of funds for a period after termination of the employment relationship with an employee;

• receipt of funds by a Sole Proprietorship owner for a period after termination of their state registration.

The funds may be repaid voluntarily or recovered through the procedure established by law.

Employment Center Inspections

The employment center has the right to inspect the documents and information used as the basis for granting assistance.

An inspection may take place:

• at the employer's registered address;

• at the place where business activities are conducted;

• at the employment center's premises;

• remotely using communication technologies.

Payments may be suspended during an inspection, but for no more than 30 calendar days.

If an employer or Sole Proprietorship owner obstructs an inspection, payments are suspended until it is actually conducted. If the obstruction continues for 30 calendar days, payments are terminated. A final inspection of the proper use of funds may be carried out within 180 calendar days after the last payment.

To protect the business, it is advisable to retain a complete set of documents together: the application, Appendices 1–4, notices and decisions from the employment center, timesheets and work schedules, calculations of reduced working hours, payroll documents, payment statements, and bank confirmations of payments.

Taxation and Reporting of Assistance

Partial unemployment assistance is not included in the payroll fund. This follows directly from the Instruction on Wage Statistics, as also noted by the State Tax Service.

Subparagraph 165.1.1 of the Tax Code excludes from total taxable income, among other things, state and social assistance, state benefits, compensation, and insurance payments received by individuals from budgets and compulsory state social insurance funds in accordance with the law. Income excluded from taxable income under Section IV of the Tax Code is also exempt from the military levy under subparagraph 1.7 of paragraph 16-1, subsection 10, Section XX of the Tax Code, except for the exclusions expressly listed there.

A separate income code «210» is provided for reporting partial unemployment assistance in Appendix 4DF to the Tax Calculation. It has applied since January 1, 2024.

Tracking Reduced Working Hours and Employee Payments in Torgsoft

Torgsoft provides tools that can be used to maintain internal records of the information employers need when employees are partially unemployed. The software allows employers to maintain employee records, register working hours, and generate information on hours actually worked. The working-time registration section can record employees' start and finish times, while the work start and finish log allows this information to be reviewed by employee and period.

Torgsoft employee management features include information on official salaries, employment contracts, and payroll statements. Employers can also create employee earnings records specifying the start and end dates, amount, total amount, and frequency; these earnings may be included in payroll statements each month.

Thus, Torgsoft can be used for internal monitoring of working hours, earnings, and payments, providing source data for calculating actual reductions in working hours and managing employee settlements. However, Torgsoft documentation does not claim that the software automatically prepares applications and Appendices 1–4 specifically under Procedure No. 702. Official forms for the employment center must therefore be prepared and submitted using the current forms of the State Employment Center.

Summary: Employer's Action Plan

1. Document the actual reduction in business activity and properly formalize changes to employees' working arrangements.

2. Verify that at least 20% of employees are affected and that their working hours and wages have both decreased by at least 30%.

3. Check compliance with USC requirements and the absence of wage and tax arrears.

4. Submit an application to the employment center within 90 calendar days from the start of the reduction.

5. Attach the information required by Appendix 1; a Sole Proprietorship owner applying for assistance on their own behalf also submits Appendix 2.

6. After approval, submit Appendix 3 each month by the 10th; Sole Proprietorship owners submit Appendix 4 for themselves.

7. After receiving the funds, the employer must pay employees within three working days.

8. Within five calendar days after payment, provide the employment center with a copy of the payroll statement or cash payment statement.

9. Keep documents and actual working-time and payment records for possible inspection.

10. After the program ends, comply with employment guarantees for a period equal to the actual assistance payment period, but no longer than 180 calendar days.

Official Sources

Law of Ukraine «On Employment of the Population» dated July 5, 2012, No. 5067-VI — Article 47, «Partial Unemployment Assistance».
Law No. 5067-VI on the website of the Verkhovna Rada of Ukraine

Resolution of the Cabinet of Ministers of Ukraine dated June 21, 2022, No. 702, «On Approval of the Procedure for Providing Partial Unemployment Assistance» — paragraphs 1–28, Appendices 1–4, particularly paragraphs 6–9 and 12–27-1.
Procedure No. 702 on the website of the Verkhovna Rada of Ukraine

Resolution of the Cabinet of Ministers of Ukraine dated January 7, 2026, No. 40, «Certain Issues Concerning the Provision of Employment Services» — amendments to procedures for submitting applications and documents, including through the Diia Portal.
Resolution No. 40 on the website of the Verkhovna Rada of Ukraine

Resolution of the Cabinet of Ministers of Ukraine dated July 15, 2026, No. 923 — amendments concerning applications left pending and administrative appeals; paragraph 14-1 and the revised paragraph 19 of Procedure No. 702.
Resolution No. 923 on the website of the Verkhovna Rada of Ukraine

Labor Code of Ukraine dated December 10, 1971, No. 322-VIII — Articles 32, 36, 38, 40, and 56.
Labor Code of Ukraine on the website of the Verkhovna Rada of Ukraine

Tax Code of Ukraine dated December 2, 2010, No. 2755-VI — subparagraph 165.1.1 of paragraph 165.1, Article 165; subparagraph 1.7 of paragraph 16-1, subsection 10, Section XX.
Tax Code of Ukraine

Law of Ukraine «On the State Budget of Ukraine for 2026» dated December 3, 2025, No. 4695-IX — Article 8: minimum wage of UAH 8,647 per month and UAH 52 per hour.
Law on the State Budget of Ukraine for 2026

Decree of the President of Ukraine dated February 24, 2022, No. 64/2022, «On the Introduction of Martial Law in Ukraine» — taking into account the current extension of its duration.
Decree No. 64/2022 on the website of the Verkhovna Rada of Ukraine

State Tax Service of Ukraine — reference list of income codes for Appendix 4DF: code «210» for partial unemployment assistance.
State Tax Service clarification on income codes in 4DF