Hire Employees in Georgia

Two routes exist. Registering a Georgian company is quick by regional standards, one to two months, and the ongoing burden is light, with corporate tax at 15% and no employer social contribution to administer.

An Employer of Record removes even that lead time. The EOR is the legal employer in Georgia, runs payroll, withholds the flat 20% income tax, remits pension where it applies and handles the Special Labour Permit for foreign hires, while day-to-day direction stays with you.

Engaging someone as a contractor is a third option, but only where the work is independent. Many Georgian contractors operate under Individual Entrepreneur status at 1% of turnover, which is attractive but does not change the substance test, see the risk check further down this page.

Georgia is among the cheapest formal labour markets in the region to employ in. Total mandatory employer cost above gross salary is 2%, against roughly 22% in Turkey and Ukraine and about 30% in Spain. Payroll is correspondingly simple: one flat tax rate, one contribution, one monthly filing.

That changes the EOR-versus-entity arithmetic. In most markets an entity begins to pay for itself once employer contributions become a large fixed cost worth administering in-house. Here there is almost nothing to save, so the break-even sits later than usual, nearer 20 to 25 employees.

Break-even rule of thumb: EOR fees begin to exceed the running cost of a small Georgian company somewhere between 20 and 25 employees, later than in most markets, because employer contributions are minimal. Model both before committing, see EOR vs Entity for the full comparison.

There is no employer social security tax in Georgia. No unemployment contribution, no health levy, no payroll surtax. Above the flat 20% income tax withheld from the employee, the only employer cost is the funded pension.

The funded pension is 2% from the employer, matched by 2% from the employee, with a state top-up on a tapering scale: 2% where annual salary is below GEL 24,000, 1% between GEL 24,000 and GEL 60,000, and nothing above that. There is no ceiling on the employer or employee share itself.

Pension applies only to Georgian citizens, permanent residents and stateless persons with permanent residence. A foreign national without permanent residence is outside the scheme entirely, so employer cost for that hire is gross salary and nothing more. The exemption has to be applied deliberately in payroll rather than assumed.

Commercial guides conflict with the statute on who must enrol. Several state that enrolment is mandatory for employees who were under 40 when the scheme began, and optional above that age. The Law on Funded Pension sets the test at 60 for men and 55 for women before the law took effect, everyone younger than that is in. Applying a 40-year threshold would wrongly exclude a large part of the workforce.

Gross monthly salaries for full-time roles in Tbilisi. Employer cost is 2% above gross for residents and nil for foreign nationals without permanent residence.

Benchmarks below are gross monthly salaries in Georgian lari for full-time roles in Tbilisi. With employer cost at 2% for residents and nil for foreign nationals, gross salary is very close to total employment cost.

Payroll is monthly and wages must be paid at least once a month. Late payment of wages carries a small daily charge on the overdue amount under the Labour Code.

One filing covers everything. The employer submits a monthly declaration to the Revenue Service for the withheld income tax and remits the funded pension to the Pension Agency on the same cycle, both due by the 15th of the following month. Interest runs daily from day one on anything outstanding.

Income tax is a flat 20% on Georgian-source employment income with no brackets and no cumulative calculation. Raising gross by GEL 1,000 always produces GEL 800 net before pension, which makes salary modelling unusually predictable.

Georgia taxes territorially. Tax residents pay income tax only on Georgian-source income; foreign-source income is exempt. Residency is triggered by 183 days of physical presence in any rolling twelve months.

There is no statutory 13th or 14th month. Any annual bonus is a contractual matter under article 41 of the Labour Code.

Georgia applies a single flat rate rather than progressive bands. Separate regimes exist for Individual Entrepreneurs at 1% of turnover and for dividends and interest at 5%, and those should not be confused with employment income.

The Labour Code of Georgia is the governing statute, supported by the Law on Funded Pension and the Tax Code.

The standard working week is 40 hours. Different limits apply to work under arduous, harmful or hazardous conditions.

Annual leave is 24 working days paid, plus a further 15 days unpaid. The unpaid entitlement is a statutory right rather than a discretionary allowance and should be reflected in workforce planning.

The statutory minimum wage is a relic. GEL 20 a month for the private sector has been unchanged since 1999 and was set by presidential decree rather than legislation. It is not indexed and no one is paid it; it survives as a legal reference point for fines and fees. Market rates, not the statute, set the floor.

A written labour agreement is required and sets the form and amount of pay, including any bonus, which is contractual rather than statutory.

Probation may be agreed for up to six months and must be recorded in writing, with the employee paid during the period.

Fixed-term contracts are permitted where the nature of the work justifies them. Where a fixed term is used for continuing work, the relationship risks being treated as indefinite.

The standard week is 40 hours. Overtime is compensated at an increased rate agreed between the parties or set by the Labour Code, and total working time is capped.

Employees are entitled to daily and weekly rest periods, and work at night attracts additional protections.

Reduced hours apply to work under arduous, harmful or hazardous conditions.

Georgia observes 17 public holidays in 2026, several of them Orthodox religious observances that follow the Julian calendar. They are additional to annual leave.

Georgia observes 17 paid public holidays in 2026, including several Orthodox religious observances. Dates that fall at a weekend and any substitution rules are set out below; entitlement is separate from annual leave.

Maternity and childcare leave runs to 730 calendar days, of which 183 days are paid (or 200 days in the case of complications or a multiple birth). The paid portion is reimbursed by the state up to a statutory ceiling, with any excess a matter for the employer by agreement.

Adoption leave mirrors the maternity entitlement for a child under one year old.

There is no separate statutory health insurance contribution; the state health programme operates outside payroll, and private medical cover is a common employer benefit rather than an obligation.

Termination must rest on a ground listed in the Labour Code. Notice and severance depend on the ground relied upon.

Where the employer terminates on economic grounds or for incompatibility, the employee is generally entitled to at least one month of severance, with notice or payment in lieu on top.

Written notice of termination and a written statement of reasons on request are both required, and failure to follow the procedure is a common ground for a successful claim.

Final pay is due on separation, and unpaid wages attract the daily charge under the Labour Code.

The onboarding sequence changed in March 2026. Foreign nationals now require a Special Labour Permit before they can obtain a residence permit, so the permit application must be started earlier than under the previous process.

Once resident, a foreign employee pays the flat 20% income tax on Georgian-source salary in the normal way. Pension applies only where the employee holds permanent residence.

Processing timelines vary; build the Special Labour Permit step into the plan rather than treating the residence permit as the first action.

Misapplying the pension enrolment test is the most likely error. Several commercial guides state a 40-year age threshold. The statute sets it at 60 for men and 55 for women at the date the law took effect, so most of the workforce is mandatorily enrolled. Under-enrolling creates a contribution shortfall recoverable from the employer.

Applying pension to foreign hires overstates cost. The scheme covers Georgian citizens, permanent residents and stateless persons with permanent residence. A foreign national without permanent residence attracts no pension on either side.

The Special Labour Permit is a new sequencing risk. Introduced in March 2026, it must be obtained before the residence permit, and a plan built on the old order will stall.

Note also that late payment of wages carries a daily charge under the Labour Code, that interest on late tax runs daily from day one, and that an employee concluding contracts locally can create a taxable presence for a foreign entity.

Work backwards from the start date. For a local hire through an EOR, one to two weeks is realistic once the signed labour agreement and a Georgian bank account are in place. For a foreign national, start with the Special Labour Permit rather than the residence permit.

Confirm two things before the first payroll run: whether the employee is a Georgian citizen or permanent resident, which determines whether pension applies at all; and their age at the date the funded pension law took effect, applying the statutory test of 60 for men and 55 for women rather than the 40-year threshold some guides publish.

Open the bank account in parallel with onboarding, since some Georgian banks require physical presence, and confirm Revenue Service filing access ahead of the 15th.