In the article the interaction of the municipality and the sphere of social and labor relations is described. It is at the municipal level that the establishment and development of social and labor sphere occurs. In this case, first of all, the approach used in the consideration of the municipality and the sphere of social and labor relations is important. Currently, there are a number of concepts that characterize the category of "municipality" from different perspectives: reproduction, opportunistic or market, corporate (quasi-corporation and quasi-state), institutional, resource and social approaches. Also efforts are made to create mixed approaches to connect different features of municipality. These concepts, in many ways, determine the nature of social and labor relations. But most of them are ''narrow'', one-sided. This, in turn, limits the consideration of social and labor relations of the municipality. While the analysis of sustainable development of municipalities in different directions we must consider the social and labor sphere. Therefore, an integrated approach that combines various aspects of analysis and counterbalances different approaches is required. In this respect the authors propose to use the ''side'' approach. The main feature of this approach is to consider the person as a multifaceted being (worker, consumer and social creature). In line with this, we may single out the major subsystems of a municipality: technical, social and institutional. This is essential, first, to integrate the existing approaches, and, second, to analyze multidimensionally social and labor relations at the municipal level. That is not only the analysis of relations between employers and workers, but also of the social partnership and social responsibility (relationship with the population of the municipality, local authorities). With this integrated approach, it is possible to consider the municipality and social and labor relations from different perspectives, for example, focusing on the person as an employee (technical sub-system) with the analysis of the municipality as a quasi-corporation, etc. Thus, due to the ''side'' approach it becomes possible to use all the considered approaches in a complex. The approach focused on a person allows us to consider social and labor issues of the municipality in the analysis to ensure its sustainable development.