Employment Law | INKO LEGAL

Compulsory mediation

Pre-action mediation applies within Article 3 of Law No.7036. Occupational accident and disease compensation and related determination, objection and recourse actions are excluded. Determination of employment is also outside this prerequisite. Filing without the required mediation application leads to procedural dismissal.

Mediation is often assumed to be a "formality"; yet a significant share of disputes is resolved at a table where the parties come prepared. What is decisive is that the heads of claim have been correctly calculated: severance, notice, annual leave, overtime, weekly rest day, national holiday and public holiday pay must be set out separately and with their reasoning.

Termination and reinstatement

An employee whose employment contract has been terminated and who is covered by job security must apply to a mediator seeking reinstatement within one month of being served with the notice of termination. This is a forfeiture period.

For the termination to be considered valid, the employer must rely on a valid reason and comply with the termination procedure: the notice of termination must be in writing and state the reason; in certain terminations related to the employee's conduct or performance, the employee's defence must also be taken. In practice, many terminations are found invalid for procedural deficiencies even where the reason is genuine.

Heads of claim and limitation periods

Claim	Limitation period
Severance pay	5 years
Notice pay	5 years
Annual leave pay	5 years
Overtime, weekly rest day and public holiday pay	5 years
Wage claims	5 years

Limitation periods may vary according to the type of claim and the date of termination; this table is a general framework.

Evidence: who holds the records

Most employment cases are a matter of evidence. Payslips, the employment commencement declaration, the Social Security Institution (SGK) service record and timesheet records are, as a rule, held by the employer. In overtime claims, witness testimony plays an important role; however, where signed payslips show overtime accruals, the contrary must be proven by written evidence. Records kept by the employee, messages and entry and exit records also carry evidential value.

Occupational accident files

Occupational accident and occupational disease files proceed on a different logic from employment claims: claims for pecuniary and non-pecuniary damages, a court-appointed expert examination to determine the degree of fault, and the permanent incapacity rate are decisive. A criminal investigation may also run in parallel in these files.

The employer side

Preventing a dispute is often cheaper than litigating it: drafting employment contracts and their annexes correctly, conducting the termination process in accordance with procedure, and preparing releases in compliance with their conditions of validity.

For general information purposes; time limits and rights vary according to the circumstances of the specific case.

SUBJECTS UNDER THIS HEADING

The headings inside this area

Reinstatement Action and Mediation

Severance Pay, Notice Pay and Overtime Claims

Termination for Just Cause and the Defence Procedure for Employers

Occupational Accident and Occupational Disease

Action for Determination of Employment and SGK Disputes

FREQUENTLY ASKED

What people ask about this area

I have been dismissed. How much time do I have?

If you have a reinstatement claim, you must apply to a mediator within one month of being served with the notice of termination; this is a forfeiture period. If you will only claim severance, notice and other employment claims, the limitation period is longer, but applying early is always in your favour so that the evidence is fresh.

Can I receive severance pay if I resign?

As a rule, no severance pay arises on resignation. However, severance pay may be claimed in terminations for just cause such as non-payment of wages, underpayment of social insurance premiums, mobbing or a fundamental change in working conditions. In that case, it is important that the notice of termination states the just cause clearly and that it is supported by evidence.

What conditions are required for a reinstatement action?

Job security generally requires an open-ended contract, at least thirty employees across the same employer’s workplaces in the same line of business, and at least six months’ seniority; underground workers are exempt from the six-month condition. Employer representatives excluded by Article 18 of Law No. 4857 are outside the regime. An employee challenging an invalid dismissal must apply for mediation within one month of receiving the termination notice and, if no agreement is reached, file within two weeks of the final mediation report.

In which cases is severance pay earned?

An employee with at least one year's seniority is entitled to severance pay where the employer terminates for a reason outside Article 25/II of Law No. 4857, where the employee terminates for just cause (such as non-payment of wages, mobbing or a fundamental change in working conditions), on military service, on retirement, where a female employee terminates within one year on account of marriage, and on the death of the employee.

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