Ukraine as a democratic, legal social state on the path to European integration, needs to reform all sectors of society. Particular attention in the transformation process is paid to the penitentiary system. The rights of persons who have committed a criminal offense and are held in penitentiary institutions (hereinafter – PIs), along with the rights of other citizens, are protected by the Constitution of Ukraine and international human rights law. Among the fundamental human rights is the right to work. In its turn, the work that convicted persons are involved in is a necessary component of achieving the goal of serving a sentence – the correction of a person and his or her resocialization. Labor is a significant factor in human life. It is a volitional activity aimed at creating material values. Labor as a means of correction and resocialization of a convicted person is defined by the provisions of Article 6 of the Criminal and Executive Code of Ukraine (hereinafter – the CEC). The conscientious performance of their labor duties is taken into account when applying for conditional early release of a convicted person. Therefore, socially useful labor, which convicted persons are involved in, helps to reduce crime. Given the reforms that the penitentiary system in Ukraine has undergone, legal regulation of the organization of work of persons held in PIs is an actual issue of the day. The article highlights the legal basis for organizing labor of persons held in penitentiary institutions. The essence of the constitutional right of a convicted person to work is considered. Labor is defined as a means of correction and resocialization of a convict. The legal basis of socially useful work of convicts is analyzed. The functions of socially useful activities of convicted persons are defined. The principles of involving convicts in socially useful work are defined. The author establishes the working conditions for those convicted to restraint of liberty. The author analyzes the current legislation of Ukraine in terms of the obligation to involve convicted persons in labor; the list of jobs and positions in which it is prohibited to use convicts; requirements for remuneration, working week, and salary; involvement in labor on a free basis; and pension provision for convicted persons. The author draws conclusions about the need for further reform of the penitentiary system in terms of ensuring that convicts have the right to engage in labor activity in accordance with their abilities, desire and fair remuneration. Key words: labor, work of convicts, labor activity, labor contract, penitentiary institution, socially useful work, labor functions, working conditions, involvement in work, remuneration, penitentiary system in Ukraine, European integration.