Changes related to the employment of non-residents in Georgia
On May 17, 2023 the Parliament of Georgia amended the "Labor Migration" law, which came into effect on September 1, 2023.
Conditions of employment contract of a foreigner in Georgia were regulated only by Resolution No. 417 before the mentioned amendments took place. From the date of the amendment, the labor migration law will regulate above-mentioned relations.
Relations related to labor relations with a foreigner who does not have a permanent residence permit in Georgia, and the implementation of remunerated labor activities, are now subject to regulation by the law.
Definitions of important terms
The law defined important terms related to labor migration:
According to the law, a labor immigrant is a foreigner who does not have a permanent residence permit in Georgia, who enters Georgian territory in order to work with a local employer and perform remunerated labor activities. Therefore, a foreigner who does not have a permanent residence permit and has signed an employment contract with a local employer will be considered a labor immigrant.
The concept of a local employer was also clarified – from 1 September, 2023 "A local employer is a legal entity registered in Georgia, an individual entrepreneur registered in Georgia, a partnership, a representative office of a foreign organization registered in Georgia, or a person living in Georgia on a legal basis, who is granted the right to have an employment relationship with a labor immigrant in Georgia, and who uses labor in Georgia ".
Terms of employment contract
The amendments to the law established (expanded and consolidated) the minimum requirements necessary for the legality of labor activity between a labor immigrant and a local employer:
A foreigner legally living on the territory of Georgia has the right to perform remunerated labor activities with a local employer. Before signing the contract, the labor immigrant must meet the requirements established by the law for entering Georgian territory. If the employee is a citizen of a country that requires a visa to enter the territory of Georgia, then the prerequisite for such employment would be a visa as well. Note, that the legislation does not exclude the possibility of employment on the basis of a tourist visa or for those with visa-free travel.
According to the law, another prerequisite for the implementation of remunerated labor activity is an employment contract. For this contract except the basic requirements stipulated by the labor legislation, additional technical requirements are provided by the Law on Labor Migration and Resolution No. 417 of the Government of Georgia:
The following information must be specified in the contract of employment, mandatorily:
- · Name and surname, personal number and/or residence card number and/or passport number of the contracting labor immigrant;
- · The name and identification number of the local employer or the name, surname and personal number of the individual entrepreneur or natural person who is the local employer;
- · Legal and actual addresses and bank details of the local employer;
- · The date of entry into force and the term of validity of the employment contract;
- · Place of employment of the contracting labor immigrant (including the full names of the organization and structural unit, if the local employer is a legal entity);
- · The full address of the immigrant employee’s place of work;
- · Basic rights, obligations and responsibilities of a contracting labor immigrant;
- · Basic rights, duties and responsibilities of a local employer.
In general, existing labor contracts already include the above-mentioned conditions, with which our law firm was dealing with before. Therefore, the contracts signed by the labor immigrant do not require any amendments, although the law additionally establishes one important circumstance – an employment contract can only be concluded for a specified period (see more discussion on this, below).
Guarantees of labor immigrant protection should be of the same quality as in the case of employment of a citizen of Georgia. The employer must ensure the principle of equal treatment that is consolidated in labor law.
In addition, it is allowed to sign an employment contract only in written form. The language of the contract must be Georgian and labor immigrant’s native foreign language (Or in another language that the employee understands, which would be English in most cases).
This requirement serves to simplify the process of assertion and create stronger guarantees for the foreign employee. In addition, the requirements serve simplification of labour relations in general.
Regarding the conclusion of the contract for a specific period:
Several questions arise regarding this obligation (signing the contract only for a specified period), since most of the employers have concluded employment contracts for an indefinite period. There are also large number of employees who have signed an employment contract for more than 30 months and are considered as permanent employees according to the Labor Code.
Employers may have a question whether the aforementioned requirements apply to employment contracts concluded before September 2023 and whether it is possible to sign a fixed-term contract for a period of more than 30 months (for instance, 5 years) and not be considered as permanent employee; Would the fixed-term employment relationship convert into a permanent one, since the Labor Code provides this?
As you may know, the Labor Code provides imperatively that after the expiration of more than 30 months period from the beginning of the employment relationship, the employment relationship will be transformed into permanent one.
The law does not directly contain a reference to the obligation of the local employer to change the contracts signed for an indefinite period before September 1, 2023, and to determine their expiration with a specific date.
From our point of view, there is no obligation for employers to change the contracts signed with the labor immigrant before September 1, 2023 and to specify the term of employment, since the law does not contain retroactive provisions.
Moreover, our law office believes that the contract concluded for an indefinite period after September 2023 is not a problem either – If the employee wishes to do so, based on the mandatory requirements of the Labor Code (30-month rule), since the Labor Code is an organic law and is above the law on Labor Migration, it should be considered legal to conclude indefinite contracts, regardless of requirement of the law on Migration.
From our point of view, allowing to conclude the contracts for the period determined by the Law on Labor Migration refers to the employer's right to sign fixed-term contracts even after 30 months of employment. However, the dilemma of whether or not the employment relationship will be considered permanent as a result of the mentioned terms, remains open to question and may become a subject of discussion in court.
Requirement of providing information about employment to the Authorities
Another important legal requirement is the obligation to serve a notice about employing a non-resident to the Ministry of Health.
Before the amendment to the Law on Labor Migration, a government resolution was the basis of the obligation to send a notification (to the e-mail address: infosesa@moh.gov.ge) to the State Employment Promotion Agency about the commencement of employment of a labor immigrant. It was mandatory to send the notification within 30 calendar days after the conclusion of the employment contract, however, the resolution did not provide sanctions for failure to provide or for delay in providing the above-mentioned information; Inspection and control mechanisms were unclear, which caused some ambiguity from a legal point of view.
As a result of the legislative amendments, the ambiguity has improved. The law establishes the obligation of the local employer to carry out the mandatory registration of data of labor immigrants in Georgia within 30 days from the date of signing the employment contract and the data of existing labour immigrants to the Ministry of Health, Labor and Social Affairs of Georgia by November 1, 2023.
The sanctions established by the amendments of May 17, 2023 provide for a fine of GEL 1000 for employers if they do not register employees. Repeated non-compliance is fined with an increased amount of GEL 2000 and GEL 6000 for third time - respectively.
In order to provide the mentioned data to the Ministry, a registration portal was launched from September 1, 2023 .
About D1 category visa and work residence permit
With the package of legislative amendments, an amendment was made to the Law of Georgia on the legal status of foreigners and stateless persons, which defined an additional requirement for the issuance of a D1 category immigration and labor residence permit - registration of an employee in the relevant portal of employed persons.
Accordingly, the existence of an employment contract alone is no longer sufficient to issue either a D1 category visa or a labor residence permit. The employee must be registered in the unified database of the Ministry of Health, Labor and Social Affairs of Georgia as a labor immigrant.
From September 1, 2023, the existing database of employees will be available to the LEPL State Service Development Agency. That will simplify the procedures for issuing work residence permits.
An amendment was also introduced in the application form of the labor residence permit: it is mandatory to indicate the registration number of the labor immigrant in the form.
Our law firm is keen to assist with any ongoing labor issue of your business in Georgia. For more details, we are ready to provide more in-depth analysis and legal assistance on your labor matters.
