Average Earnings Calculation in Uzbekistan

Reference period

Average earnings are based on wages accrued over the twelve months preceding the month in which they are calculated. If the employee has worked for less than twelve months, the period actually worked is used (Article 257(1)).

A month means a calendar month — from the 1st to the 30th (31st) inclusive, and in February to the 28th (29th). Rolling periods such as "15th to 14th" are not used.

Which payments are included

The calculation includes all of the employee's income in the form of remuneration for work that the employer actually paid and that is taxable under tax legislation (Article 257(2)). The list of employment income is in Section XIII of the Tax Code of the Republic of Uzbekistan, which deals with PIT.

Under all pay systems, average monthly wages equal one twelfth of all employment income accrued over the twelve calendar months before the month in which average wages are preserved (Article 257(3)).

If pay rates were revised during the reference period, average monthly wages are recalculated using the revised rate. There is also a floor: for an employee who worked the full monthly norm and performed the job function, average monthly wages may not be lower than the statutory minimum wage on the calculation date.

Which periods are excluded

Both the time and the amounts accrued for it are excluded from the reference period if (Article 257):

• the employee was paid average wages — except breaks for feeding a child;
• the employee received sick-leave or maternity benefits;
• there was downtime for reasons beyond the control of both the employer and the employee;
• additional paid days off were granted to care for children with disabilities (Article 399);
• the employee was released from work with full, partial or no pay in other cases established by law.

Formula: average daily and hourly wages

Average daily wages are average monthly wages divided by the average monthly number of working days — 25.3. The Code uses this single figure in all cases, whether the employer runs a five-day or a six-day week.

If some months of the reference period were not fully worked or part of the time is excluded, average daily wages are calculated differently: total wages actually accrued for the period are divided by the sum of 25.3 × the number of full months plus the days counted in incomplete months. Days in an incomplete month are converted proportionally: 25.3 is divided by the actual number of working days in that month and multiplied by the working days worked.

Average hourly wages are average monthly wages divided by the hours worked in the last calendar month before the month in which average wages are preserved.

Illustrative example: over 12 full months an employee accrued UZS 120 million of taxable employment income. Average monthly wages are UZS 10 million (1/12), and average daily wages are about UZS 395,257 (10 million / 25.3).

If there was no pay in the reference period

• no accrued wages or days worked in the reference period or before it — average wages are based on pay for days actually worked in the month in which the event occurs;
• no accrued wages in the period, before it or before the event — average wages are based on the employee's tariff rate (salary);
• for part-timers, average wages at the main job and at the secondary job are calculated separately, whatever the purpose.

Where average earnings are used

• annual leave: average wages under Article 257; Sundays are not counted when paying for leave, and payment is due no later than the last working day before the leave starts (Article 233);
• study and creative leave, and the four-calendar-day annual social leave for a parent of two or more children under twelve or of a child with a disability under sixteen — with average wages preserved (Article 237);
• business trips: the job and pay terms are preserved, and average earnings are kept for piece-rate employees for the trip and travel time (para. 12 of the Regulation approved by Cabinet Resolution No. 424);
• benefits: average wages for benefits are calculated under Article 257; sick-leave benefit is 80% of average monthly wages with total service of 8 years or more and 60% with less than 8 years (para. 24 of the Regulation approved by Cabinet Resolution No. 314); maternity benefit is 75% with up to 12 months of service with the employer and 100% beyond 12 months (para. 35).