Legislative initiative proposes amnesty on pension fund fines for employers settling overdue contributions by year-end

“Under a new legislative initiative, employers who settle their outstanding pension fund contributions by year end will have their accrued fines written off,” declared Speaker of the Parliament of Georgia Shalva Papuashvili during today’s Bureau meeting.

According to Papuashvili, a legislative package on funded pensions, encompassing five key reforms, has been formally initiated at the Bureau.

“This concerns contributions to the pension fund. Some employers failed to make required contributions and incurred fines; therefore, we have taken the decision to introduce a draft amnesty bill covering these fines. This reform will affect approximately 13,500 employers, totaling around 43 million GEL. If an employer clears their pension arrears and late-payment interest by the end of the current year, their accrued fines will be written off,” Papuashvili stated.

He further noted that the bill includes procedural and substantive adjustments, notably reducing baseline fine amounts.

“In place of the current fines of 500 and 1,000 GEL for initial and repeated infractions, the fine will be reduced to 300 GEL. Additionally, a dispute resolution service will be established within the Pension Fund to ensure matters can be reviewed before court proceedings.

The fourth key reform provides the option to schedule pension contribution payments in instalments over a period of up to 18 months. The fifth reform concerns the rules for serving and appealing fines; specifically, if the contribution is settled within ten days, the fine will be cancelled, and an appeal will automatically suspend enforcement.

The overriding issue is that employers were withholding pension contributions, thereby directly prejudicing their employees. Our primary objective under this legislation is to ensure employers do not harm their workers. Certain employers incurred these fines due to specific circumstances; if the principal debt, namely the pension contribution itself, along with the interest, is fully paid, the fine portion will be waived,” Papuashvili explained.