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Rights of Employees (Unfair Dismissal) in Cyprus

For a person to be regarded as an employee the question which needs to be answered is whether the contract is a contract of service or a contract for services. If the person who has been hired to do a specific task works for his own account then this is regarded as a contract of service and no relationship of employer-employee exists. If the contract is for services, an employer-employee relationship exists.

When a relationship of employer-employee is established, the next factor to look at is whether this contract is for a specific duration or for an unlimited duration. If for example, the duration is for a specific number of years or until a specific future event occurs, the contract is for a specific duration. This means that after the contract is completed, the employee has no further rights in terms of dismissal. The same applies for contracts of employment, which even though they are of an unlimited duration, they specify a probationary period. The probationary period must not exceed 2 years and in case the employer decides to dismiss the employee within the probationary period, he can do so at the end of the probationary period.[1]

If the employer breaches the specific duration contract or the probationary period by dismissing the employee earlier than the specified period,[2] he is liable to pay damages to the employee.

If the contract is of unlimited duration, then the termination of employment in Cyprus is governed by the Termination of Employment Law (L. 24/1967). The Termination of Employment Law aims to provide employees with rights when it comes to job security given that usually the employee is in a worse bargaining position than the employer. In this way the Law can be used as a weapon by the employee in cases of unfair dismissal.

When can the employer dismiss the employee:

There are several reasons when the employee can be legally dismissed under the Law. First of all, an employee can be legally dismissed when he has completed the retirement age which currently stands at 65 years. Article 5 of the Law provides several other reasons where the dismissal is not unfair.

[1] This is unless a specific notice period is provided in the Contract

[2] See footnote 1

These include cases where:

• The employee fails to carry out his work in a reasonably sufficient manner.
• The dismissal is a redundancy.
• The dismissal is due to reasons which cannot be controlled by the employer such as war, fire or an “act of God”.
• Other reasons having to do with the bad character and work ethic of the employee (for example leaving work whenever the employee decides, serious negligence in carrying his duties, committing a criminal offence in the course of employment, etc).

A dismissal is prima facie regarded as unfair and the burden is on the employer to prove otherwise. Dismissals are always unfair when the reason for the dismissal is due to race, religion, political views etc., or if the employee is a member of a trade union or representative of employees, or where the dismissal is because the employee has filed a complaint against the employer, or takes part in a procedure (criminal or civil) against the employer. If an employer dismisses an employee because the employee is appearing as a witness in a court procedure against the employer, that also amounts to a contempt of the court, which is punishable by imprisonment.

An unfair dismissal need not be direct. It can be indirect (or in law a “constructive dismissal”). Constructive dismissals occur when the actions of the employer force the employee to quit his employment.

In case the dismissal is deemed unfair by the court the maximum compensation which can be awarded by the court is 2 years of the employee’s salaries. The minimum which can be awarded is calculated in accordance with the period the employee has worked. Below are some indications.

Notice Period:

Irrespective of whether the dismissal is fair or unfair, in most cases, when an employer terminates the employment of an employee, he has to give notice to the employee prior to the dismissal. This notice must be paid and the period of the notice is according to the weeks the employee was in employment. The following is an indication of the periods:

The notice period must be in writing and it cannot be excluded or the periods reduced by contract. Furthermore, the 8 week period is the minimum which can be as it may have to be extended according to custom or practice.

It is not only the employer who has to give a notice. The employee also has to give a notice in cases that he/she is planning to leave his/her employer. The period which must be given by the employee is according to the weeks the employee was in employment:

This article is given for information purposes only and it does not constitute legal advice. For further information and advice please contact Mr. Evripides Hadjinestoros at eh@dhadjinestoros.com.

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