Cyprus: Employees’ Protection Against Unfair Dismissal

The main piece of legislation regulating termination of employment in Cyprus is the Termination of Employment Law (Law No. 24/1967) of 1967 (as amended) (the “Law”). The Law covers all employees, whether in private sector or public sector, including apprentices.

Termination of an employment

Pursuant to the provisions of the Law, an employer who intends to terminate an employee’s employment must, provided 26 weeks have passed since the date of commencement of the employment, give to the employee a minimum period of notice depending on the duration of the employee’s employment and any provision in any contract or other agreement for shorter notice is void. The notice must be in writing as follows:

Probation: Where the employment is on a probationary basis, no notice is required if during or at the end of the period of probation either party decides not to continue the employment. The period of probation must not be longer than 104 weeks. Any period of probation longer than 26 weeks does not fall within the above-mentioned exception save by agreement in writing between the employer and the employee made at the time of commencement of the employee’s employment

Notice period: Important points to note

• • The aforementioned provisions of the Law relating to the period of notice do not affect the rights of the employer or the employee to a longer period of notice if they are so entitled by custom, collective agreement, law contract or otherwise.
  • An employer who gives notice to an employee has the right to require from the employee to accept payment in lieu of notice. In such a case the employee must leave his employment right away, provided the employer has paid the wages which correspond to the period of notice.
  • An employee, who has been given notice, is entitled to a full paid time off from work not exceeding 8 hours per week and a maximum of 40 hours in total, in order to be able to seek a new employment. Besides, an employee who is given notice by an employer has the right, if he receives an offer of new employment from another employer during the period of notice, to leave the employment of his employer without further notice in order to take up the new employment. In such a case the employee loses his entitlement to payment for the remainder of the period of notice. 
  • An employer is not allowed to give notice to an employee who is absent from his employment because of inability to work for a period up to six months from the first day of the employee’s absence.

Grounds for dismissal without notice

The employer has the right to terminate the employment of an employee without notice, where the employee’s conduct is such as to justify his dismissal without notice. The following may, inter alia, constitute grounds for dismissal without notice:

• • Conduct of the employee makes it clear that the relationship between the employer and the employee cannot reasonably be expected to be continued.
  • Commission of gross misconduct by the employee in the course of his duty.
  • Commission by the employee in the course of his duties of a criminal offence without the agreement, expressed or implied, of his employer.
  • Immoral behaviour by the employee in the course of his duties.
  • Serious or repeated contravention or disregard by the employee of work or other rules in relation to his employment.

Overall, the decision to dismiss an employee must be reasonable and there are no fixed rule or law defining the degree of misconduct which will justify dismissal without notice. The criteria will vary, and all the circumstances of each particular case must be evaluated.

Employee’s right to compensation for unlawful dismissal

An employee, whose employment is terminated unlawfully (ie for a reason other than those stated above) by an employer with whom he has been continuously employed for not less than 26 weeks, is entitled to compensation.  Compensation is also payable in the case of an employee who terminates his employment because of his employer’s conduct (“constructive dismissal” cases).

The amount of compensation is determined by the Industrial Disputes Tribunal, following an application by the employee but in no case it can be less than the amount of redundancy payment, to which the employee would be entitled, had he been declared redundant, or higher than two years wages. In calculating the amount of compensation, the Industrial Disputes Tribunal takes into account, among other things, the employee’s wages, the period of employment, the loss of career opportunities, the employee’s age and the circumstances of his/her dismissal.

Dismissal not giving right to compensation

No compensation is payable in the case of any employee, who, before the termination of his employment, has attained the pensionable age (65).  Besides, termination of employment for any of the following reasons does not give rise to a right to compensation:

• • where the employee fails to carry out his work in a reasonably efficient manner (temporary inability to work due to sickness, injury, maternity or disease does not fall within this exception);
  • where the employee has become redundant within the meaning of the Law;
  • where the termination is due to force majeure, war operations, up-rising, act of God or destruction of the plant by fire not caused by the willful act or negligence of the employer;
  • where the employment is terminated at the end of a fixed term contract or because of the attainment, by the employee, of the normal age of retirement by virtue of custom, law, collective agreement, contract, works rules or otherwise;
  • where the employee so conducts himself as to render himself liable to dismissal without notice.

The burden of proving that an employee’s employment was terminated for one of the reasons set out above is on the employer.

Unlawful reasons for termination of employment

The following, inter alia, never constitute valid reasons for the termination of employment:-

• • union membership or participation in union activities outside working hours or, with the consent of the employer, within working hours or membership in a security committee;
  • seeking office as, or acting or having acted in the capacity of, a worker’s representative;
  • the filing in good faith of a complaint or the participation in proceedings against an employer involving alleged violation of laws or regulations, both civil and criminal, or recourse to a competent administrative authority;
  • race, colour, sex, marital status, religion, political opinion, national extraction or social origin;
  • pregnancy or maternity;
  • taking maternity leave or leave for force majeure.

An employee whose employment has been terminated for whatever reason is entitled to receive, on request at the time of the termination, a certificate from the employer specifying the dates of his employment and the type or types of work on which he was employed. Nothing unfavorable to the employee must be inserted in this certificate

Whether you are an employer or an employee, our team of lawyers can provide professional advice to any employment law dispute. If you require any further information, please do not hesitate to contact us.

Disclaimer: This note serves as a general overview of the relevant Cyprus legislation and the information set out shall not be considered as a legal advice nor shall be relied upon by any natural or legal person. G.C. Hadjikyprianou & Associates LLC shall not be liable for any damages incurred by any person who relied solely on the information provided herein. For the avoidance of any doubt, this note is merely intended to highlight key issues and not to be comprehensive and no party shall re-produce and/or use the same without our prior written consent. Use of the information provided herein is subject to our Terms of Use.