Labor relations in the non-profit sector are characterized by specific features that distinguish them from the classic business sector. NGOs often depend on grant funding, which necessitates project-based (fixed-term) employment contracts. The Labor Code of Georgia sets strict regulations regarding fixed-term contracts, and their violation (e.g., groundless extension) results in the contract transforming into an open-ended one, creating financial risks for the organization after the grant ends. Furthermore, NGO employees often work with vulnerable groups, requiring specific confidentiality and ethical norms to be included in employment contracts.
The NGO employment contracts service involves preparing legally sound contracts that protect both the organization's and the employee's interests. Specialists offer:
- Drafting fixed-term employment contracts tied to specific grant projects (so-called "project-based employment");
- Differentiating between service agreements and employment contracts to avoid tax risks;
- Developing internal labor regulations tailored to the organization's specifics;
- Drafting confidentiality and conflict of interest clauses;
- Legalizing the employment of foreign experts;
- Managing contract termination procedures in case of project completion or funding cessation.
The need for specific employment contracts arises in many situations. For example, an organization secures a 1-year grant and needs to hire a project coordinator. If the contract does not correctly state that employment is within the framework of a specific project, the organization may struggle to release the employee without compensation after the grant ends. Another example is when an NGO invites a trainer for short-term workshops — here, it is better to sign a service agreement to avoid obligations for leave and other social guarantees. Also, for organizations working with children, requesting a criminal record certificate and integrating a special code of conduct into the employment contract is critical.
Legal regulation is based on the "Organic Law of Georgia — Labor Code of Georgia." Article 6 of the Code defines the grounds for concluding a fixed-term contract, including the "performance of a specific volume of work" or "seasonal work," which is often used for grant projects. The "Tax Code of Georgia" is also important, as it taxes employment and service contracts differently (income tax vs. VAT/small business tax). A lawyer helps you draw this line correctly so that the Revenue Service does not reclassify the relationship and impose penalties.
The process begins with an analysis of the organization's staffing list and project timelines. The lawyer prepares employment contract templates for various positions (administration, project staff). Special attention is paid to the remuneration clause, where it might be specified that the salary is paid only upon receipt of the grant (though this provision requires careful legal phrasing). Completed documents are handed over to the client with instructions. With the help of a specialist on Legal.ge, you will receive flexible and lawful tools to manage your team.
Legal.ge is the best resource for finding labor law specialists who understand the specifics of project-based work. Protect your organization from financial risks and ensure decent working conditions for your employees. Find your legal partner on Legal.ge.
Updated: ...