Georgia’s labor code still favors employers

Sarah Delys is a criminologist working for Human Rights Education and Monitoring Centre in Tbilisi.

Last week hundreds of train workers went on strike after negotiations to improve working conditions and raise salaries failed. The strikers demand overtime compensation, new salary rules and a 13th month salary payment [1].

Leaders of the trade union say the railway workers work in difficult conditions, have no canteen, shower or changing room, or even soap and hot running water.

As a result of the strike, the Georgian Railway administration filled the positions of striking workers with unqualified personnel which lead to three accidents in the course of one night. A trade union representative claims that continuing the work in this manner constitutes a violation of safety protocol.

Dialogues have resulted in the approval of some of the workers’ demands. The management of the Georgian Railway has agreed to a new year’s bonus, fixed salaries under the new payment system that will be introduced in the future as well as to internal monitoring procedures which will allow following up on the execution of the mediation agreement and other company activities [2].

For years Georgia has been criticized that its labor legislation proposed a serious disadvantage for employees and while the adoption of the amended Labor Code in 2013 was welcomed, changes remained minimal. Especially the effective enforcement of the law poses a big challenge. Georgia is still one of the few countries that do not have a labor inspectorate.

Georgia’s Labor Code

A well-developed Labor Code with a clear framework of rights and obligations in the workplace can be beneficial for the entire society. It protects the health of the workforce and promotes sustainable economic growth.

During the drafting process of the new law in 2006, the government aimed to create an attractive investment and business climate what led to a maximal deregulation of the employment sector. While many have admired Georgia’s economic growth, it hasn’t done much for workers’ rights.

Under the previous government, the approach seemed to work for the development of the industry and economy. However, after the power transition, the current government should primarily pursue a policy directed at the protection of the workers and the environment.

Even though the legal framework clearly refers to labor rights and environmental protection, the current working conditions in industrial zones are still dangerous.

International obligations

Along with the signing of the Association Agreement (AA) with the EU and the DCFTA, came the need for approximation to European standards and practices.

Moreover, international standards call for the creation of institutions and mechanisms which can enforce labor rights. The EU-Georgian Association Agenda reads that focus must be “on improving safety at work” and on the creation of “a mechanism and institution with adequate capacities for the inspections of working conditions in the spirit of the new law and ILO standards”.

The ILO developed Guidelines on occupational safety and health management systems (OSH standards) as a contribution to the protection of workers from hazards and to the elimination of work-related injuries, ill health, incidents and deaths. At a national level, they could be used to establish a national framework for OSH management systems, preferably supported by national laws and regulations.

Safety & health

Mining sites and other industrial operations in Georgia cause massive pollution, which has led to poor living conditions in those specific areas. Most of these mining companies have been operational since soviet times and local residents have been enduring all kinds of troubles (noise, water and soil pollution, emission of toxic substances etc.).

The Labor Code specifically stipulates that an employer is obliged to provide a safe labor environment; however, no paragraph indicates what sanctions an employer may face if this obligation is violated.

Despite continuing pollution and alarming statistics of workers’ deaths and injuries, there is still no relevant mechanism in place to monitor industrial companies. Not for compliance with labor law requirements, nor for environmental law requirements.

The industrial workplaces often lack adequate security standards and control mechanisms. The alterations in the Labor Code did not reverse the situation and so far the state has been silent about a strategy to solve the issue.

Labor dispute and mediation

The new law also envisages a new regulation for the examination of disputes that come from collective labor relations. Now, collective disputes are settled via conciliatory procedures between the different parties. Before the 2013 changes there was no differentiation between an individual and a collective dispute.

The conciliatory process should include an employer and a group of employees; an employer and a trade union; or all of those parties through mediation. In case of mediation, the mediator is appointed by the Minister of Labor, Health and Social Affairs upon written request of one of the parties.

However, in spite of these changes and the government’s declared policy to strengthen the mediation process, reality shows that no effective policy has been developed yet.

The government’s reluctant participation[3] in the mediation process during the Kazreti strike raises the question whether the state is willing to proactively work towards a solution. Even though an agreement was reached eventually, the Kazreti case cannot be seen as a complete success. Some clauses of the agreement were either not implemented in time, or not implemented at all. This shows that there is a need for effective monitoring procedures which will oversee the execution of the mediation agreement.

Labor inspectorate

In May of this year media reports[4] about the re-establishment of a labor inspectorate appeared. A labor inspectorate would be set up “soon”, but the government could not “specify details on the upcoming structure or when this inspection will be established”.

More recent news says that a special structure to monitor compliance of private companies with the Labor Code regulations should start operating in 2015. However, a law that will set up the inspectorate has not yet been adopted. So far, nothing has been decided about authority, sanctions, complaint procedures etc.

In order to approve safety at work, it is high time for the Government of Georgia to create a mechanism and institution with adequate capacities for the inspections of working conditions within the frameworks of the new law and in line with ILO standards. At the moment, Georgia is the only ILO member (out of 182 members) that has no labor inspectorate or any other institution with such functions.

Positive impact

Conformity with international labor standards often brings improvements in productivity and economic performance. Workers are more satisfied with higher wages and regulated working times which leads to a lower turnover of staff.

Safety standards, and effective control, can reduce costly accidents and health care fees. Social protection systems (in particular unemployment and health insurance), active labor market policies and social dialogue protect workers during harsh times. The ILO concluded that strengthening social dialogue, freedom of association, and social protection systems would provide better safeguards against economic downturns.

A labor market that is regulated by proper national legislation, within the international labor standards framework, is more efficient and will bring benefits to for both workers and employers.

Notes:
[1] Hundreds of Georgian Railway workers go on strike, http://agenda.ge/news/25271/eng
[2] Special decision of Administration of the Georgian Railway, http://www.railway.ge/?action=news&lang=eng&npid=358
[3] Only after the involvement of several CSOs and when the strike became the centre of media attention, did the government appoint a mediator to set up a mediation strategy.
[4]  Labor inspectorate coming soon in Georgia, http://www.georgianjournal.ge/business/27211-labor-inspectorate-coming-soon-in-georgia.html
[5] Georgian government in no hurry to set up the labour inspectorate, http://www.commersant.ge/index.php?lang=2&menuid=88&id=15111