Parliament clears pension fine waiver for employers who repay contributions

Georgia’s parliament has approved amendments allowing employers to have certain fines imposed by the Pension Fund waived if they fully pay outstanding pension contributions and penalties by the end of 2026.

The legislation passed its third and final reading under an expedited procedure on Wednesday, with 76 MPs voting in favour.

Under the amendments, employers will be conditionally exempted from administrative fines imposed by the Pension Fund after 1 May 2025, provided they settle all outstanding pension contributions and related penalties by 31 December 2026.

The legislation also reduces the fines for violating mandatory pension contribution requirements. The penalty will be set at 300 GEL for both first-time and repeat violations, down from 500 GEL and 1,000 GEL respectively.

The bill introduces new rules governing violations of employers’ obligations to make pension contributions. It defines the concept of “lost benefit” and establishes procedures for detecting violations, imposing fines, calculating lost benefits for pension scheme participants, enforcing decisions and appealing them.

Employers will also be allowed to repay outstanding pension contributions and lost benefits in instalments under the new rules.

The amendments further establish a dispute resolution service within the Pension Fund to handle complaints and set out procedures for reviewing and deciding such cases.

The bill was presented to parliament by Paata Kvizhinadze, chair of the Finance and Budget Committee.