What an Internal Fraud Investigation Means
Investigating workplace fraud is the employer's process of establishing the factual circumstances of a violation committed within the employment relationship — theft, misuse of company resources, falsification of documents or flagrant disregard of duties. The Georgian Labor Code places this process in a clear legal framework: a violation established by the investigation may become the ground both for a disciplinary measure and for termination of the employment contract, while compensation for damage caused is a separate claim. It is essential that every step — recording the violation, requesting an explanation, drawing the conclusion — complies with the Code's requirements; otherwise the employer itself ends up bearing responsibility in the dispute. A properly built file is what turns suspicion into a provable case.
When the Contract May Be Terminated as a Result
Article 47 lists the grounds for termination of an employment contract, two of which fit fraud cases. The first is the employee's gross violation of obligations imposed by the individual employment contract, the collective agreement or the internal labor rules. The second is an ordinary violation of the same obligations where the employee has already had a disciplinary measure applied within the last 1 year. A violation of obligations imposed only by internal labor rules constitutes a ground for termination only if the internal rules form part of the employment contract. The same article establishes important safeguards: termination is impermissible on any other ground, on grounds of discrimination, during the protected period after the employee notifies the employer of pregnancy, due to conscription or reserve service, or while the employee serves as a jury member — except under specifically named grounds. In fraud cases the correct qualification — gross violation or repeated violation — determines the lawfulness of dismissal, so the investigation file must establish the boundary between the two with evidence.
Material Liability for Damage Caused
Article 58 sets the rule: in an individual employment relationship, damage caused by one party to the other is compensated according to the procedure established by Georgian legislation. An employer harmed by fraud may therefore bring a claim for compensation independently. Article 59 allows the type and scope of the employee's individual liability to be defined in a written contract where this follows from the specifics of the work. Particularly important is that a contract on full material liability may be concluded with an adult employee who stores, processes, sells, transfers, transports or uses in production valuables entrusted to them. A cashier, store manager, warehouse keeper or other materially responsible person is precisely the addressee of this norm. Where such a contract exists, full compensation of the established damage may be claimed; where it does not, the scope of liability is determined by general legislation. Calculating and substantiating the amount of damage is a separate task of the investigation, since an unsubstantiated amount will not be awarded by a court.