Fair Labor Platform report: 88% of workers in Georgia have experienced wage theft

25 Jul, 2022

The Fair Labor Platform has published a new report assessing the prevalence of wage theft in Georgia and the state strategy to combat it. The report finds that 88% of workers sampled do not bring home their full pay due to wage theft.

The report is based on data from the Platform’s Wage Theft Calculator, an online tool that helps workers determine whether they have experienced wage theft. Between December 2020 and June 2022, 3,167 workers used the Calculator. Of those, 2,789 said that they were victims of at least one form of wage theft in the workplace. Their reported losses to wage theft totaled 25,585,074 GEL per year – an average of 8,079 GEL per person, per year.

Wage theft is defined as the failure to pay any money legally owed to an employee. It covers a wide range of infractions, such as unpaid overtime work, illegal deduction of wages, and non-payment of paid vacation. All of the forms of wage theft included in the Wage Theft Calculator are illegal under Georgian law.

According to the report, the most common form of wage theft in Georgia is “off-the-clock” work, which is defined as mandatory work that is not counted as part of normal working hours. Over 75% of the employees indicated that they had been forced to perform unpaid, off-the-clock work in the past year.

Unpaid overtime was also extremely common. Out of 1,253 employees who indicated that they worked overtime at their employer’s request, a total of 1,072 (85.6%) said that they were not paid at all for this work. In addition, only 11.7% of Wage Theft Calculator users said their contracts specify a set overtime rate, despite this being a requirement under Georgian law.

The report also assesses the effectiveness of efforts by the Labor Inspectorate to combat wage theft. In 2021, out of 1,766 violations detected at 249 facilities inspected by the Labor Inspectorate for the purpose of labor rights supervision, 357 violations (20%) were likely related to the practice of wage theft.

Wage theft is particularly prevalent in the healthcare sector, where a huge proportion of employees already work for extremely low wages. In 2021, the Labor Inspectorate found evidence of wage theft in 86 out of the 110 medical clinics it inspected. These instances were mostly related to Covid-19 supplements provided by the state, which were intended to boost the pay of medical personnel but were often not paid out to employees.

Some clinics also failed to pay employees’ salaries at for several months. For example, the inspection report for one clinic shows that between September 2020 and August 2021, salaries were paid to only 2 out of 129 employees. The total amount of lost wages was calculated as 626,460 GEL.

“Wage theft has been normalized in the health care sector,” says Revaz Karanadze, representative of the Solidarity Network, an independent labor union. “Medical workers are fighting a wage theft pandemic along with the Covid pandemic.”

The report also assesses the role of the courts in upholding workers’ rights and recovering stolen wages.

“The prevalence of wage theft and the huge financial damage it causes requires urgent attention from the state, which is, unfortunately, lacking at the moment. Workers must be able to recover stolen wages quickly and efficiently without being stuck in litigation for years,” says Tatuli Chubabria (Social Justice Center).

According to the report, other prevalent forms of wage theft in Georgia include:

  • Illegal salary deductions: 492 employees (15.5%).
  • Non-compensation for paid leave: 57% of employees who were entitled to leave by law indicated that they either did not take the leave they were entitled to or were unable to use the full 24 days.
  • Non-compensation for sick days: 221 employees reported needing sick leave, with 91 (41.2%) of them reporting that their employer did not pay them for these days.
  • Unpaid tips: Out of 281 users who reported that their employer collects tips, 184 (65.5%) said that they did not receive any of this money.

Read The Report