BUSINESS
NEW LABOR CODE MISSED THE GOAL
11 July, 2013
Expected to insure better protection of employees, the newly enforced labor code misses the goal as it provides better protection to employers again.
After eight-months of strained work and disputes carried on by the government with businesses, trade unions and non-governmental sector, the new labor code came into effect and Georgia got a completely new labor legislation blueprinting European standards as Alexandre Baramidze, deputy minister of Justice, accentuated it. According to him, thanks to this new regulation nobody will be
able either to fire people without explanations or force work extra hours without proper payment any more. However neither business nor the human rights watchdogs are happy about the new labor code. While Mikheil Kordzakhia, Head of Employers’ Association of Georgia, dislikes that the employer is responsible to prove the fault of employees at court in litigation cases, Lika Tsiklauri, a lawyers with Georgian Young Lawyers Association (GYLA) that has been involved in the labor code related issues for many years, regrets that new labor code still provides better protection to employers rather than to employees.
“The aim of this reform was to make employees less vulnerable and more protected but it did not achieve the goal,” Tsiklauri said in the interview to Georgian Journal. It was an open secret that employees were working under bondage contract terms built in the old labor legislation that entered into effect in 2006 and the EU community has been pressing on Georgian government to remove the discriminating paragraphs and put in line with the international standards until 2009 but to no avail. As soon as the power shifted in fall of 2012 the new authorities initiated changes in Georgian labor legislation in order to set it in compliance with the European law and make it more tailored on the interest of employees. But this goal failed, Tsiklauri assures for it includes some hidden bombs. Among many defects of old labor code two key flaws were the most challenging: admitting terminable contracts that enabled employers intricately manipulate and violate rights of employees; and that contracts might be dissolved without explanation after paying a month’s compensation. The fired side could not find the truth even through court for it was legal. Since 2012 the practice slightly changed demanding explanations to sacking employees that enabled the latter to find the truth at courts. The newly amended code somewhat retrieved these defects as obliges employers to conclude maximum 3-month terminable contracts – the longer ones must be interminable. However, the new law envisages exceptions that untie hands to employees to act at their discretion again: for instance, terminable contracts are available “under certain objective circumstances” without specifying these circumstances thus leaving room to double-interpretation in favor to employers. Another worse exception exempts the newly set up organizations from the obligation of interminable contracts for 4 years since their start up days.
“So the goal to make interminable contracts a rule and terminable one just an exception is not achieved, for during 4 years the said organizations may enjoy terminable contracts,” Tsiklauri elaborates. The contract dissolvent aspects seem also murky. While employers cannot dismiss employees without explanations they can dismiss them without compensation and court opportunities if an employee makes two breaches to her/his employment obligations during a year. Still no specification to the breaches are outlined that enables employers fire anyone for slightest infringement such as to be late at work for example. The said breaches are put to the fired persons’ papers that undermine reputation forever. Meantime, the timeline to filing a lawsuit against the employer was cut down from 3 years [starting the dismissal day] to a month that decreases the court access opportunities.

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