The Georgian Labor Code is extensive and offers significant employee protection. These laws oversee the individual and collaborative relationships between the employer and employees. Furthermore, the scope of these laws extends to social security, health, safety and special employment relationships.
If you want to open a business in Georgia, go through this guide to hire compliantly and understand the rights of the employees.
Applicability of the Act
The Labor Code of Georgia is applicable for the following:
- Regulation of employment relations in the country of Georgia that are not otherwise governed by an international agreement or a special law
- Issues related to employment relations not regulated by the Civil Code or any other special law
Employers must sign a written contract with their employees to establish a professional relationship. The employment contract must specify the following conditions:
- The date of commencement of employment
- Terms of labor relations
- Working hours
- Rest time
- The position
- Compensation, taxes, deductions, and in-hand salary
- Overtime pay
- Number of paid leaves and the procedure to request them
Key Provisions of the Act
Many aspects of the Georgian Labor Code outline processes and mandate benefits to employees. You must know the following provisions while building a workforce:
The minimum wage in Georgia is 115 Georgian Lari per month for public employees and 20 Georgian Lari per month for private-sector employees.
The working hours in Georgia must not exceed 40 hours a week, excluding breaks and resting time. For businesses with specific operating conditions that require more than eight hours of continuous work, the Labor Code directs a maximum of 48 hours per week. Furthermore, these businesses must belong to the special list of industries covered under this exception by law.
Shifting work and transfer from one location to another must be according to a shift schedule approved by the employer. The employer must brief the employee of the changes in shift schedules ten days in advance unless it is an immediate move due to urgent business matters.
The Georgian law does not permit employing a minor under age 16, women in the postnatal period, a breastfeeding woman, or an individual with limited capabilities on a night job (22 pm to 6 am).
An employee is obligated to work overtime in the following events:
- To prevent and liquidate the results of natural disasters without any remuneration
- To prevent and liquidate the results of an industrial accident, with proper remuneration
- Usually, working for more than 40 hours per week qualifies the employee for overtime. The overtime pay must be higher than the regular pay, agreed and signed in the employment contract. The employer may propose to compensate for the overtime with time off.
- Employers must seek the consent of pregnant women, women in the postnatal period, and professionals with limited capacities before allotting them overtime work.
Paid and Unpaid Leaves
Employees in Georgia are entitled to 24 calendar days of paid and 15 calendar days of unpaid leaves. The employee’s right to request a leave may arrive after 11 months of working with their employer. However, this can be overlooked if the employer enters an agreement to grant leaves before the term expires.
The employee must provide a two-week notice for unpaid leave, except in urgent medical or personal emergencies.
You must calculate the amount of leave entitled to an employee based on the time of actual work done and any forced suspension by the employer. Moreover, the employer must not include the employee’s unreasonable absence from work or unpaid leaves for more than seven business days.
The employer can carry over the leaves to the next year, with the employee’s consent, if it will not impact the business operations. However, the employee cannot carry over the leaves for more than two consecutive years. In the case of minors, the law completely prohibits carrying over the leaves.
Employers must calculate the leave pay per the average compensation for the three months preceding the leave. However, if the time worked after the leave or the last leave is less than three months, the leave pay is calculated per the average compensation of the months of work. If an employee receives a fixed monthly compensation, the leave pay is calculated per the last month’s pay.
Employees in Georgia are entitled to a total of 477 calendar days of maternity and paternity leaves to cover pregnancy, delivery, and child care. 125 calendar days from the total are paid leaves, which can be increased to 140 if there are complications during the delivery or multiple births. The employee can use these days during both pregnancy and postpartum periods.
Employees who adopt a child are granted 365 calendar days of leave after the child’s birth. 70 calendar days out of the total are paid leaves.
The State Budget provides compensation for pregnancy, parental, or adoption leaves, per the legislation. The employer and employee can arrive at an additional agreement if the former has released additional compensation.
Within five years after the child’s birth, an employee may choose to take additional 12 weeks of unpaid leave for child care. The employee may take the leaves all at once or incrementally, but not less than two weeks per year. Anybody taking care of the child qualifies for this leave, not just a parent.
Social Security and Tax
There is no deduction of any amount towards the social security fund for Employees in Georgia.
On the other hand, the personal income tax is a flat 20% for every employee in the country.
Health and Safety at Work
The Labor Code of Georgia outlines the following provisions under the Right to a Safe and Healthy Working Environment for every employee:
- The employer must ensure the maximum safety and well-being of their staff in the working location
- The employer must provide their employees with complete information regarding the factors that impact their health and safety during work
- An employee may refuse to fulfill a task that goes against the law, violates the safety of the working location, and creates a danger to the life, health, property, or the employee or the safety of the natural environment. They must notify their employer of the circumstances behind the refusal. They must notify their employer of the circumstances behind the refusal.
- The employer should implement a prevention system for ensuring labor safety and inform their staff in advance about the relevant risks and preventive measures regarding their safety. Furthermore, employers should educate their employees about the rules of using hazardous equipment. The employer may provide personal protective facilities to the professionals and replace the hazardous equipment with safer alternatives.
- The employer is responsible to ensure the timely localization and resolution of professional accidents, providing first aid and evacuation
- The employer must reimburse the medical treatment and rehabilitation for the employee’s worsened health due to their official duties
- The employer must safeguard pregnant employees from tasks that pose a threat to the welfare and physical and psychological health of the woman and the fetus
- The Georgian Legislation determines the list of hard, dangerous, and lethal jobs and the relevant safety rules. It also lays down the rules and cases of periodic obligatory medical tests of an employee that are fully paid by the employer.
According to the Labor Code of Georgia, an employer may terminate the employment contract under the following conditions:
- Finishing the job specified in the contract
- Expiration of the contract
- Violation of terms by either party
- A new agreement between the parties
- A court-mandated judgment prohibiting the work
- Long-term disability for more than 30 calendar days consecutively or 50 calendar days per 6 months
- Death of an employee or employer
- Liquidation of the legal entity of the employer
Compliance strategies for Employers
Adherence to the state and federal labor laws is essential to running a business smoothly. To ensure total compliance with these laws and avoid hefty fines, follow the given strategies:
Identify the relevant laws affecting your business
The best way to ensure compliance with the laws is by learning which ones apply to your business and aligning with them. If you find it hard to keep tabs on all the rules and regulations, consider partnering with a PEO like Multiplier.
Publish and distribute employee handbooks
An employee handbook goes a long way in ensuring smoother onboarding and educating the workforce about the company’s ethics and policies. Furthermore, you can share your compliance measures and help your workforce understand their rights. Update the handbook regularly to ensure it is up-to-date and accurate.
A yearly audit helps identify internal operations loopholes, resolve employee grievances, manage your finances better, etc. Check if you align with all the relevant laws and if your processes comply with the Georgian Labor Code. As a consequence, you will avoid paying hefty fines and running into unexpected obstacles.
How Can Multiplier Help Businesses Stay Compliant?
While hiring global employees, there are innumerable employment laws and regulations you must respect. Even a slight deviation from these rules can land you in deep trouble, impacting your image and finances. Therefore, you must conduct in-depth research of country-wise employment laws and hire responsibly.
Partnering with a PEO like Multiplier is a smarter alternative to hiring professionals across the globe and maintaining full compliance with the relevant laws. With our digital platform, you can draft legal employment contracts within minutes, allot mandatory benefits, manage payroll in desired currency and much more. With our PEO solutions, you can grow beyond borders without worrying about legal hassles.