Derzhpratsi Inspection Support: How to Pass Without Fines
The State Labour Service of Ukraine (Derzhpratsi) is one of the few supervisory bodies that has not merely kept working under martial law but has noticeably increased pressure on business. Its main target is undeclared work, and this is where fines are measured not in thousands but in tens of thousands of hryvnias per employee. Yet one nuance decides everything: the very same inspection can end either with an order that you simply comply with and face no sanctions at all, or with a resolution imposing a substantial fine. The difference often lies not in your paperwork but in how you conduct yourself during the inspector’s visit. Dextra Law supports Derzhpratsi inspections from the inspector’s first phone call through to appealing the outcome, so that an inspection does not turn into a source of losses. Here is how it works.
Can inspections be carried out under martial law
The most widespread — and most expensive — illusion in business is the belief that “the moratorium protects us from inspections.” It does not. The moratorium on scheduled state supervision measures is indeed in force (Cabinet of Ministers Resolution No. 303 of 13 March 2022), but it does not extend to unscheduled inspections — and those are the real threat. What is more, Derzhpratsi has already approved its annual plan of measures, covering over eighteen thousand business entities. Counting on “they won’t come for us” is a strategy that regularly ends in a fine.
Types of inspections and the legal framework
Derzhpratsi inspections are governed by the Law “On the Basic Principles of State Supervision (Control) in the Sphere of Economic Activity” No. 877-V and Cabinet of Ministers Resolution No. 823 of 21 August 2019, which approved the procedures for state control and supervision of compliance with labour legislation. Measures come in two types and two forms.
| Criterion | Categories |
|---|---|
| By scheduling | Scheduled (under the annual plan) and unscheduled (on specific grounds) |
| By form of conduct | Inspection visits (directly at the premises) and off-site inspections (document-based, without visiting the employer) |
Under martial law the bulk of activity consists of unscheduled inspection visits — these are what you should be ready for first and foremost.
On what grounds an inspector arrives
An unscheduled inspection is never carried out “just because” — it requires a specific ground. The most typical ones are:
- a complaint from an employee about a violation of their labour rights;
- information from the State Tax Service, the Pension Fund or other bodies indicating signs of undeclared work;
- the employer’s failure to comply with a previously issued order;
- a court decision or a request from law enforcement agencies;
- the employer’s failure to investigate an industrial accident.
Knowing the ground is critical: if an inspection has been ordered without a lawful ground or in breach of procedure, that in itself is a reason to appeal its results.
What inspectors check first
Formally, Derzhpratsi supervises all labour legislation, but in practice inspectors focus on a handful of areas where violations occur most often and cost the most.
- Undeclared work. The absolute priority: allowing an employee to start work without an employment contract, paying wages “in an envelope,” registering an employee as part-time while they actually work full-time.
- Disguising employment relationships as civil law arrangements. Sole proprietors (FOPs) or contractors working under civil law contracts who in fact operate as staff members (same schedule, same workplace, fixed monthly payment) are a classic target for reclassification into employment relationships with additional charges.
- Remuneration. Compliance with minimum state guarantees, wage payment deadlines, and final settlements upon dismissal.
- Working time and rest. Working time records, overtime, and the granting of leave.
- Occupational safety. Safety briefings, medical examinations, and occupational safety training.
- Mobbing. A relatively new area of control — workplace harassment, which also carries liability.
How an inspection unfolds
The procedure has clear stages, and at each of them the employer has specific rights.
- Opening. The inspector presents their official ID and the assignment (act) authorising the inspection. Without these documents, granting access is not mandatory.
- Conduct. The inspector examines documents and workplaces within the scope stated in the assignment. They have no right to go beyond it.
- Act. An act of the inspection visit (or of the off-site inspection) is drawn up, recording the findings.
- Order. For most violations (except undeclared work) an order to remedy them is issued — and if you comply with it in full and on time, no fine is imposed.
- Resolution imposing a fine. For undeclared work the fine is applied based on the outcome of the measure, as it is for denying access to an inspection or obstructing it.
Fines under Article 265 of the Labour Code and the “wartime” relief
Financial penalties are set out in Article 265 of the Labour Code of Ukraine, and their size is tied to the minimum wage (UAH 8,647 in 2026). The main fines are broadly structured as follows.
| Violation | Fine (multiple of the minimum wage) |
|---|---|
| Undeclared work: allowing work without an employment contract, wages “in an envelope,” part-time registration with actual full-time work | 10x per employee (30x for a repeat violation within two years) |
| Denying access to an inspection concerning undeclared work | 16x |
| Failure to observe minimum state guarantees on remuneration | 2x per employee |
| Breach of other labour law requirements | 1x (3x for a repeat violation) |
Now for an important relief measure. For the duration of martial law a special rule applies (part 3 of Article 16 of Law No. 2136-IX): if the employer complies with the order to remedy violations in full and within the set deadline, fines under Article 265 of the Labour Code are not applied. If the order is complied with only partially or late, the fine cannot be avoided — but it can be halved by paying 50% within ten days of the resolution being served. This makes the right response to an order a key defence tool.
Employer rights during an inspection
An inspection is not a situation in which the employer is powerless. On the contrary, knowing your rights often decides the outcome:
- demand the official ID and the inspection assignment, and verify the ground and scope of the inspection;
- be present during all of the inspector’s actions;
- submit written explanations and remarks, which are entered into the act;
- refrain from signing the parts of the act you disagree with, stating this expressly;
- receive copies of the act, the order and the resolution;
- appeal the results of the inspection.
One point deserves the opposite emphasis: refusing to let the inspector through the door without grounds is a serious mistake. Denying access to an inspection or obstructing it is a separate violation carrying its own substantial fine. The right tactic is not to keep them out, but to control the scope of the inspection and carefully document every action the inspector takes.
Appealing the results of an inspection
Inspection results are not final — they can and should be appealed where there are grounds. An order or an inspector’s demand is appealed within ten days to the head of the territorial body of Derzhpratsi, and then to the higher authority within Derzhpratsi. The act and the resolution imposing a fine can be challenged in court.
In practice, the grounds for setting aside inspection results are: breach of the inspection procedure; absence of lawful grounds for ordering it; incorrect application of the law; a mismatch between the recorded violations and the actual circumstances; timely compliance with the order; and absence of fault on the employer’s part. Case law shows that businesses fairly often succeed in overturning Derzhpratsi orders and resolutions where these were issued with procedural breaches or without a proper evidentiary basis.
How to prepare in advance
The best inspection support begins long before the inspector arrives. A preventive HR audit lets you find and close risks while they are not yet fines:
- verify that every employee is properly registered and eliminate any signs of undeclared work;
- review civil law contracts and arrangements with sole proprietors for reclassification risk;
- put HR documentation in order — orders, the staffing schedule, timesheets, employment contracts;
- check compliance with remuneration guarantees and payment deadlines;
- update occupational safety documents — briefings, medical examinations, training.
How Dextra Law supports Derzhpratsi inspections
Inspection support is part of our labour and employment practice. We work at every stage — from prevention to litigation:
- We prepare you for the inspection. We run an HR audit, identify and eliminate risks, in particular undeclared work and high-risk civil law contracts.
- We attend the inspector’s visit. We verify the grounds and scope of the inspection, are present during the inspector’s actions, and monitor compliance with procedure.
- We handle the act and the order. We prepare explanations and remarks and build a compliance strategy designed to avoid a fine.
- We appeal the results. We prepare complaints to Derzhpratsi and court claims where an inspection was conducted improperly.
- We defend you in labour disputes. If the inspection was triggered by a conflict with an employee, we take on the resolution of labour disputes.
A Derzhpratsi inspection is a process the prepared party wins. Preparation and sound conduct during the visit are exactly what we take on.
Frequently asked questions
The moratorium applies only to scheduled inspections. Unscheduled inspection visits are carried out on specific grounds, and these are the main threat. On top of that, Derzhpratsi has approved its annual plan of measures. Relying on the moratorium as protection is not advisable.
That is a dangerous tactic. Denying access to an inspection or obstructing it is a separate violation carrying a substantial fine under Article 265 of the Labour Code. It is better to request the official ID and the assignment, verify the ground and scope of the inspection, and control its limits rather than block access.
Above all, undeclared work: working without registration, wages “in an envelope,” part-time registration with actual full-time work. Also under scrutiny are employment relationships disguised as contracts with sole proprietors, remuneration, occupational safety and mobbing.
No. For most violations an order is issued first, and if you comply with it in full and on time, no fine is applied under martial law. The exception is undeclared work, which is fined based on the outcome of the inspection.
An order or an inspector’s demand is appealed to the head of the territorial body of Derzhpratsi within ten days, after which you can turn to the higher authority. The act and the resolution imposing a fine are challenged in court.
Yes. If a fine has been imposed, it can be halved by paying 50% within ten days of the resolution being served. Voluntary payment of the fine must be made within one month of the resolution being adopted.
Run an HR audit: check that employees are properly registered, review civil law contracts for reclassification risk, and put HR documents, remuneration and occupational safety paperwork in order. This is the cheapest way to avoid fines.
Expecting a Derzhpratsi inspection?
The Dextra Law team will prepare your business for the inspection, attend the inspector’s visit and appeal the results if the inspection was conducted improperly. Get in touch to arrange an HR audit and put together an action plan before the inspector knocks on your door.
