Relation between the informal employment and job satisfaction is investigated in the paper. Informal employment takes rather big place in Russian economy, what makes research of the mechanism of the informal sector of the labor market functioning very relevant. Ordered choice models with sample selection correction were estimated on the Russia Longitudinal Monitoring Survey of HSE (RLMS-HSE) data. The key result of the paper is that subjective well-being is not determined by employment status itself, crucial is conditions of choice. Individuals, who came to the informal sector because of their own choice, treat their job as well as workers' with the registered employment. So, they have no incentives for seeking to formalize their status, which could mean further growth of the informal sector.