ARMENIA Law and Practice Contributed by: Narine Beglaryan and Anahit Aloyan, Concern Dialog
(such as merger, consolidation, separation or restruc - turing), all rights and obligations, including those under employment contracts, automatically transfer to the successor entity. This means that when out - sourcing is structured as a transfer of a business unit that qualifies as a reorganisation, employees can be automatically transferred to the new employer with - out termination of their contracts. However, if such transfer results in changes to any essential working conditions, compliance with the above-mentioned procedure remains mandatory. In practice, the most common approaches are either to offer employees new employment contracts with the outsourcing provider or to retain them with the original employer, while the outsourced services are delivered externally under contractual arrangements between the outsourcing company and the client company. 5.2 Role of Trade Unions or Workers’ Councils Under the Labour Code, employees have the right to freely establish trade unions to protect and represent their interests. Where no trade union exists, employ - ees may elect representatives or delegate representa - tion to a sectoral or territorial union. In practice, such employee representations are not commonly estab - lished. If they do exist, the employer must respect the representatives’ rights, refrain from interfering with their activities, and consult them before making deci - sions affecting employees’ legal status. While Arme - nian law provides that, in certain cases, employer con - sent may be required, no such cases are currently defined, meaning that consultation remains advisory rather than mandatory. 5.3 Offshore, Nearshore and Onshore In Armenia, there has been a growing trend towards onshoring in outsourcing transactions. Armenian com - panies increasingly prefer to retain or relocate services
within the country rather than rely on offshore provid - ers. This shift is driven by several factors: • heightened awareness of data protection and cybersecurity risks, particularly where client or employee personal data is processed; • the introduction of government incentives for local IT and tech service providers, which makes onshore solutions more cost-effective; • competitive pricing of domestic providers, coupled with the steady development of Armenia’s IT and business services sector; and • operational efficiencies gained from cultural align - ment, absence of time zone barriers, and easier The Labour Code expressly defines remote working as the performance of an employee’s duties without being physically present at the workplace. Remote working is permissible only with the mutual consent of the employer and the employee, provided the nature of the work allows it. The arrangement must be docu - mented in writing. The conditions of remote work – including the provi - sion of equipment, reimbursement of related expens - es, and procedures for performance monitoring – are determined by collective agreements, internal policies or mutual written agreement. During remote work, the employee must remain accessible to the employer and properly fulfil their duties; failure to do so is treated as a disciplinary breach. Importantly, the health and safety obligations of the employer are significantly reduced in the remote work - ing context, with the exception of the duty to provide necessary personal protective equipment. Employees working remotely, whether from Armenia or abroad, retain all rights and guarantees provided under Arme - nian labour law. regulatory compliance. 5.4 Remote Working
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