Do I pay enforcement fees upfront for unpaid wages?

No. Under Georgian law, employees enforcing claims specifically for unpaid wages are generally exempt from paying advance enforcement fees. The fees are directly charged to the debtor company.

What if the employer company is empty or bankrupt?

If the LLC has no assets, an experienced lawyer will investigate if the directors fraudulently transferred assets elsewhere. If proven, directors can be held personally liable to pay your compensation.

Do employees have priority if the company goes bankrupt?

Yes. In Georgian insolvency proceedings, claims arising from labor relations (unpaid salaries, severance) are treated as priority claims and are paid out before most other unsecured corporate debts.

Enforcement of Financial Claims from Labor Disputes

The Importance of Enforcing Labor Disputes

The enforcement of financial claims arising from labor disputes refers to the final phase of restoring an employee's violated rights. When an employer unfairly dismisses an employee, fails to pay their rightful salary, overtime, or compensation, the employee must seek justice through the courts. After winning the court case, the stage of actually paying the imposed amount by the employer (company or individual) begins. Unfortunately, unscrupulous employers often ignore court decisions and attempt to conceal company assets, empty accounts, or artificially bankrupt the company. Therefore, the enforcement of labor disputes requires rapid and strict legal responses to ensure the employee receives their rightfully earned compensation.

What this Legal Service Includes

The service involves the comprehensive representation of the employee's interests during the enforcement proceedings stage. The lawyer obtains the writ of execution and immediately applies to the National Bureau of Enforcement or a private enforcer. The service covers placing garnishments and freezes on the company's (respondent's) bank accounts so that any incoming funds are directed to satisfy the employee's claim. Furthermore, the search and seizure of the company's real estate, vehicles, equipment, and inventory are carried out. If the company lacks cash, this property is subject to sale at auction. The service also includes close coordination with the enforcer to prevent the employer's attempts to transfer assets to someone else's name.

Common Labor Dispute Scenarios

In practice, the forced recovery of unpaid salaries and final settlement amounts is the most common. The enforcement of forced absenteeism compensation (salary compensation) imposed due to illegal dismissal, which accumulates from the day of dismissal until the execution of the court decision, is also very relevant. In some cases, the matter concerns the recovery of damages awarded as a result of an injury sustained at the workplace. Complex scenarios unfold when an employer LLC (Limited Liability Company) ceases operations, opens a new company under a different name, and continues the business there. In such times, professional lawyers use the principle of piercing the corporate veil and demand the direct personal liability of the company director or founder towards the employee.

Legislation and Employee Privileges

The Labor Code of Georgia and the Law on Enforcement Proceedings grant special protection to claims arising from labor relations. Firstly, employees seeking the enforcement of a labor claim enjoy certain benefits, including exemption from the advance payment of the enforcement fee (regarding salary claims). Additionally, if a company goes through bankruptcy or liquidation processes, according to the Law of Georgia "On Insolvency Proceedings," labor claims represent one of the priority ranks compared to other creditors. This means that the funds obtained from the sale of the company's assets must first satisfy the employees' claims and only then other obligations.

Forced Enforcement Process and Steps

The process begins with the registration of the application and the writ of execution in the enforcement body. The enforcer sends a notification to the company for voluntary compliance. Since companies often have active turnover in their bank accounts, the first and most effective step is placing a freeze and garnishment on the accounts. This blocks the company's financial operations, which often forces them to quickly pay the debt to continue their activities. If there are no funds in the accounts, the inventory of the company's assets begins—seizing office equipment, cars, and stock. The attached property is appraised and sold at an electronic auction, from which the proceeds are transferred to the employee.

Challenges and the Risk of Company Bankruptcy

One of the biggest threats when enforcing labor claims is the real or fictitious bankruptcy of the company. If the employer no longer has property and the accounts are empty, the enforcement proceedings may prove fruitless. That is why speed is critically important. As soon as the court decision enters into force, attachments must be placed immediately. If the lawyer determines that the director intentionally alienated assets to avoid paying the debt, it is possible to raise the issue of criminal liability or demand civil compensation for damages directly from the director (imposing joint and several liability).

Why legal.ge and the Necessity of Hiring a Lawyer

Winning a labor dispute is only half the battle. To achieve a financial result, the involvement of an experienced specialist during the enforcement stage is necessary. Legal.ge is an innovative platform in Georgia that allows you to easily find lawyers specializing in labor law and enforcement. The professionals in our system are well-acquainted with the specifics of corporate debtors and know how to force unscrupulous employers to fulfill their obligations. Compare lawyer profiles, experience, and choose the best representative on legal.ge. Do not allow your employer to violate your rights with impunity—get qualified help and recover your rightful compensation.