The Influence of Neo-Liberal Policy on Labor Rights in Georgia

Ensuring that workers are guaranteed basic labor rights is still a serious challenge in Georgia. The source of these problems is the state’s policy of inaction, which, on the one hand, is the result of the country’s transformation of its historical formations, and on the other hand, the realization by each of the Georgian governments that ensuring secure working conditions creates a space for people to think and act freely.

After the collapse of the Soviet Union, in a period of civil war and terrible socio-economic conditions, the first post-Soviet government fell victim to unrealistic perceptions of national ideals. The subsequent government reduced the country to conditions of overpowering corruption and completely hopeless economic stagnation.  No progress was made in the country, either in terms of human rights or in the protection of the labor market. Under such conditions and against a backdrop of widespread social discontent, in 2003, a coalition of young politicians replaced the government by means of the ‘Rose Revolution’[1], determining that the route to economic success was the free market and a policy of complete deregulation, the automatic adoption of which, without a critical comprehension of the capitalist economic model, was supposed to allow for a clean slate of economic renewal.

In line with this policy, since 2004, there has been a wave of aggressive privatization[2]. Strategic resources, including the right to mine natural resources, were slated for privatization. In this process, the interests of private individuals came in direct conflict with public interests, however, the revolutionary government did not have to think overmuch about who was going to receive preferential treatment between the opposing sides. Resources were illegally transferred to offshore enterprises, hidden elite groups within the government and specific figures of authority, without the involvement of society or the consideration of social interests[3].

Privatized enterprises gradually began operations. In the regions of Georgia, the industrial extraction of natural resources was revived and local residents were employed. It’s important to note that the government’s declared free-market policy, which was based on liberal labor and environmental protection legislation, narrowed employer obligations to the minimum, whilst the issuance of permits for environment-impacting activities and the extraction of resources was made as easy as possible[4]. It was also in this period, that the number of regulatory organizations decreased, while their powers were significantly limited. Among them was the Labor Inspection Office, which was dissolved under the pretext of corruption. The results weighed heavily on both the workers and the environment. The course of neo-liberal economic policy resulted in the harshest consequences both for the environment and labor rights, especially in those regions where extractive industry was underway.

In 2012, the challenges of labor rights emerged with renewed vigor for Georgia’s new coalition government. Massive workers’ strikes took place in almost every industrial region of the country. Extreme violations, hidden for such a long time, were revealed: hazardous working conditions for employees[5], some working without safety equipment to protect them from dangerous conditions, wide-ranging statistics[6] of injuries and deaths (the publication of which was previously blocked[7]), cases of a discriminatory nature, including the arbitrary cessation of contracts based on employee’s trade union membership[8]. All of the above-mentioned problems are particularly acute given the fact that these enterprises are often the only source of employment for local populations. In conditions of complete deregulation, companies are using different methods to increase workers’ dependence on them, like involving financial institutions into the system. Under the obligations of the short-term lending and credit systems, employees are forced to bear most difficult conditions without complaint. Monopolist enterprises have become at once the worker’s only source of income and a threat to their lives.

The damage inflicted on the environment is also enormous. Unchecked pressure on the environment and the ruthless exploitation of resources has compromised soil, water and air quality, which has lead to the chemical contamination of food products. Cases of cancer and other serious illnesses have increased - a fact, which has not been seriously investigated by the authorities to this day[9]. Despite the wealth of mineral resources, the industrial regions have become extremely poor. Due to the levels of environmental pollution, agricultural enterprises have become unfeasible.

Liberal labor legislation has also had a serious effect on the service sector. Due to the socio-economic vulnerability of the regions, job-seekers started to migrate to the capital en masse. Exploitative labor of employees in supermarkets, cafes and restaurants has reached acute levels. With sixty or seventy-hour working weeks and minimal pay, workers are unable to meet their most basic needs. Workplace discrimination is common, with businesses employing vague disciplinary procedures, such as arbitrary fines and often the dismissal of workers[10].

Serious violations in the areas of ecology and labor rights have been identified in reports by international organizations, obligating the state to act in response. As a result, in 2013, amendments were introduced to the Labor Code. Minimal mechanisms for the protection of workers’ rights appeared in labor legislation and previously abolished regulatory offices were restored, albeit with fewer powers. By simply fulfilling international obligations, without protecting human rights standards and addressing systemic problems, the changes introduced into the legislation were unable to ameliorate long-standing violations in the workplace. The ineffectiveness of these changes was revealed in recent years by the labor strikes in different industrial regions of Georgia[11], the results of ineffective mediation efforts in the transport and metallurgy sectors,[12] the unexplained cessation of operations[13] at various facilities, etc. These events, which went beyond labor issues to encompass a wide-scale social protest movement, have revealed the need for social justice: a transparent industrial policy and proper regulation of wages.

Predatory economic policy has ensured that the survival of a worker until the end of the day is equated to the survival of his/her family until the end of the month. The state is allowing for a situation, whereby uncontrolled exploitation of natural resources leads to people becoming dependent on monopolist enterprises. Such a social background limits perspectives for the fight for a better environment, while for citizens it blocks routes for the creation of a social policy. However, as a result of neo-liberal policies coming to the surface, deeply-ingrained social dissatisfaction reduces the chances that the future government, elected in Georgia’s upcoming elections, will declare the state`s detachment from economic growth as a path to economic success and instead will disguise the state’s political failures in the sphere of public interest and the protection of human rights.