1 Legal framework

1.1 Are there statutory sources of labour and employment law?

The main employment-related statutes are as follows:

  • the Termination of Employment Law of 1967, as amended;
  • the Social Insurance Law of 2010, as amended;
  • the Annual Paid Leave Law of 1967, as amended;
  • the Protection of Maternity Law of 1997, as amended;
  • the Protection of Paternity Law of 2017;
  • the Parental Leave and Leave on Grounds of Force Majeure Law of 2012;
  • the Minimum Wage Law, as amended;
  • the Equal Treatment at Work and Employment Law of 2004, as amended;
  • the Health and Safety at Work Law of 1996, as amended;
  • Law 100(I)/2000, providing for an employer's obligation to inform employees about the conditions applicable to their contract or employment relationship;
  • the Collective Redundancies Law of 2001;
  • the Organisation of Working Time Law of 2002;
  • the Hours of Employment Law, Cap 182, and regulations issued pursuant thereto;
  • the General Framework of Information and Consultation of Employees Law of 2005;
  • the Protection of Employees Rights in the Εvent of Insolvency of the Employer Law of 2001;
  • the Human Resource Development Law of 1999;
  • the Social Cohesion Fund Law of 2020;
  • the Protection of Wages Law of 2007;
  • the Fixed-Term Work (Prohibition of Discrimination) Law of 2003;
  • the Safeguarding and Protecting Employees Rights in the Event of a Transfer of Undertakings, Businesses or Parts Thereof Law of 2000, as amended;
  • the Suppression of Racial and Some Other Forms of Discrimination (Ombudsman) Law of 2004;
  • the Equal Pay between Men and Women for the Same Work or Work of Equal Value Law of 2002;
  • the Equal Treatment between Men and Women in Employment and Vocational Training Law of 2002;
  • Law 3/1968 ratifying the Convention Relating to Discrimination (Occupation and Profession) of 1958;
  • the Part-Time Employees (Prohibition of Discrimination) Law of 2002; and
  • the Persons with Disabilities Law of 2000.

Furthermore, the Constitution guarantees certain fundamental rights relating to employment, such as the right:

  • to work;
  • to strike; and
  • to equal treatment.

International treaties that have been ratified by Cyprus regarding employment issues are also applicable. EU regulations and directives regarding employment and labour issues are also applicable in Cyprus since it acceded to the European Union in 2004.

1.2 Is there a contractual system that operates in parallel, or in addition to, the statutory sources?

In addition to the statutes outlined in question 1.1, employment relationships in the private sector are governed by the terms of the employment contract, as well as collective agreements, employer custom and practice.

1.3 Are employment contracts commonly used at all levels? If so, what types of contracts are used and how are they created? Must they be in writing must they include specific information? Are implied clauses allowed?

Employers are obliged by statute (Law 100(I)/2000, providing for an employer's obligation to inform employees about the conditions applicable to their contract or employment relationship) to provide employees with specific information about their terms of employment within one month of the commencement of employment.

This information may be given in any of the following ways:

  • a contract of employment;
  • a letter of appointment; or
  • any other document signed by the employer

Any such document contains at least the following information:

  • the identity of the parties;
  • the place of work and the registered address of the business or the home address of the employer;
  • the position or specialisation of the employee, his or her grade, the nature of his or her duties and the object of his or her employment;
  • the date of commencement of the contract or the employment relationship and its anticipated duration, if this is for a fixed period;
  • notice periods;
  • the duration of any annual leave to which the employee is entitled, as well as the manner in which and the time at which it may be taken;
  • the time limits which must be observed by the employer and the employee in the event of termination of the employment, either by consent or unilaterally;
  • all types of emoluments to which the employee may be entitled and the schedule for their payment;
  • the usual duration of the employee's daily or weekly employment; and
  • details of any collective agreements that govern the terms and conditions of employment.

2 Employment rights and representations

2.1 What, if any, are the rights to parental leave, at either a national or local level?

Maternity leave: An employee has the right to 18 weeks of maternity leave, 11 of which must be taken in the period starting from two weeks before the week of the expected birth. In the case of a second child, there is an entitlement for a further four weeks after the first 18 weeks; and in the case of three or more children, there is an entitlement for a further eight weeks after the first 18 weeks. Nursing mothers have a right to a paid one-hour breastfeeding break after their return to work. In addition, express protection from dismissal applies from the start of pregnancy until five months after the end of maternity leave (with certain exceptions). There are also additional provisions specific to adoptive mothers and surrogates.

Paternity leave: An employee whose spouse has given birth, has had a child by surrogacy or has jointly adopted with the spouse a child under 12 years old has the right to paternity leave for two continuous weeks during the period starting from the week of the childbirth or adoption and ending 16 weeks thereafter. Express protection from dismissal applies during that period (with certain exceptions).

Parental leave and leave on grounds of force majeure: Employees of either gender who have completed six months or more of continuous employment with the same employer can claim unpaid parental leave for up to 18 weeks in total on the grounds of childbirth or adoption. In the case of natural parents, parental leave is taken after the end of the maternity leave and before the child's eighth birthday. In the case of adoption, it is taken within eight years of the date of adoption of the child, provided that the child is still under the age of 12.

A minimum of one week's parental leave and a maximum of five weeks' parental leave may be taken per calendar year for one or two children; the maximum for three children or more is seven weeks. With the employer's consent, the maximum leave may exceed these limits. Provisions that are more favourable to the employee than the provisions of the law may apply under a collective agreement or by agreement between the employer and employee.

2.2 How long does it last and what benefits are given during this time?

Please see question 2.1.

2.3 Are trade unions recognised and what rights do they have?

Cyprus has a relatively high level of trade union organisation.

The main national, multi-sectoral workers' organisations are:

  • the Pancyprian Federation of Labour;
  • the Cyprus Workers Confederation;
  • the Democratic Labour Federation of Cyprus; and
  • the Pancyprian Federation of Independent Trade Unions.

Other independent sectoral workers' organisations include:

  • the Pancyprian Union of Public Servants;
  • the Pancyprian Organisation of Greek Teachers;
  • the Organisation of Greek Secondary Education Teachers; and
  • the Union of Banking Employees of Cyprus.

According to Law 71/65, as amended, providing for trade unions, trade unions have the right:

  • to possess property under their legally registered name;
  • to contract;
  • to appear before courts as either plaintiff or defendant; and
  • to proceed with all necessary actions to accomplish their purposes.

However, to enjoy these rights, a trade union must be legally registered as such.

For the purposes of harmonisation with Directive 2009/38/EC, the Parliament of Cyprus enacted Law 106(I)/2011 providing for the establishment of a European works council for the purpose of safeguarding employees' rights to information and consultation in EU-scale undertakings and EU-scale groups of undertakings. The law aims to guarantee and improve the right to information and consultation of employees in such undertakings and groups of undertakings.

Finally, the Recognition of Trade Union Organisation and of the Right to Provide Trade Union Facilities for Recognition Purposes Law of 2012 allows groups of employees at an undertaking to apply to the registrar of trade unions for recognition of a trade union for the purposes of negotiation with the employer, under certain conditions and subject to the fulfilment of certain requirements.

2.4 How are data protection rules applied in the workforce and how does this affect employees' privacy rights?

The protection of data and privacy of employees is safeguarded by the following statutes and directives:

  • Article 15 of the Constitution – every person has the right to respect for his or her private and family life;
  • Article 17 of the Constitution – every person has the right to respect for, and to the secrecy of, his or her correspondence and other communications, if such other communications are made through means not prohibited by law;
  • EU Regulation 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC ('EU General Data Protection Regulation');
  • the Protection of Natural Persons with regard to the Processing of Personal Data and Free Movement of Such Data Law of 2018;
  • the Directive of the Cyprus Commissioner for Personal Data Protection on the Processing of Personal Data in the Sector of Employment Relationships; and
  • all international instruments to which Cyprus is a party that guarantee the right to privacy, such as:
    • the European Convention on Human Rights;
    • the European Charter of Fundamental Rights;
    • pertinent International Labour Organization conventions; and
    • Court of Justice of the European Union and European Court of Human Rights jurisprudence.

Under Article 6 of the EU General Data Protection Regulation, the processing of personal data is allowed only in the following cases:

  • The data subject has consented to the processing of his or her personal data for one or more specific purposes;
  • The processing is necessary for the performance of a contract to which the data subject is a party or in order to take steps at the request of the data subject prior to entering into a contract;
  • The processing is necessary to comply with a legal obligation to which the controller is subject;
  • The processing is necessary in order to protect the vital interests of the data subject or of another natural person;
  • The processing is necessary to perform a task carried out in the public interest or in the exercise of official authority vested in the controller; or
  • The processing is necessary for the purposes of the legitimate interests pursued by the controller or by a third party, except where such interests are overridden by the interests or fundamental rights and freedoms of the data subject which require the protection of personal data – in particular, where the data subject is a child.

Further, pursuant to Article 9 of the EU General Data Protection Regulation, there is a general prohibition on the collection and processing of sensitive data ("special categories of personal data") which, under Article 9(1) may be waived, among other things, where:

  • the employee has given his or her explicit consent;
  • the processing is necessary to carry out the obligations and exercise specific rights of the controller or the data subject in the field of employment and social security and social protection law, insofar as it is authorised by EU or member state law or a collective agreement pursuant to member state law providing for appropriate safeguards for the fundamental rights and interests of the data subject;
  • the processing is necessary to protect the vital interests of the data subject or another natural person, where that person is physically or legally incapable of giving consent;
  • the processing:
    • is carried out by a foundation, association or any other not-for-profit body with a political, philosophical, religious or trade union aim in the course of its legitimate activities and with appropriate safeguards; and
    • relates solely to the members or to former members of the body or to persons who have regular contact with it in connection with its purposes;
  • and the personal data is not disclosed outside that body without the consent of the data subject;
  • the processing relates to personal data which is manifestly made public by the data subject;
  • the processing is necessary for the establishment, exercise or defence of legal claims or whenever courts are acting in their judicial capacity;
  • the processing:
    • is necessary for reasons of substantial public interest, on the basis of EU or member state law;
    • is proportionate to the aim pursued;
    • respects the essence of the right to data protection; and
    • provides for suitable and specific measures to safeguard the fundamental rights and interests of the data subject;
  • the processing is necessary for the following purposes, on the basis of EU or member state law or pursuant to a contract with a health professional and subject to conditions and safeguards:
    • preventive or occupational medicine;
    • the assessment of the working capacity of the employee;
    • medical diagnosis;
    • the provision of health or social care or treatment; or
    • the management of health or social care systems and services;
  • the processing is necessary for reasons of public interest in the area of public health (eg, protecting against serious cross-border threats to health or ensuring high standards of quality and safety of healthcare and of medicinal products or medical devices), on the basis of EU or member state law which provides for suitable and specific measures to safeguard the rights and freedoms of the data subject, in particular professional secrecy; or
  • the processing:
    • is necessary for archiving purposes in the public interest, scientific or historical research purposes or statistical purposes based on EU or member state law;
    • is proportionate to the aim pursued;
    • respects the essence of the right to data protection; and
    • provides for suitable and specific measures to safeguard the fundamental rights and interests of the data subject.

The most common methods of employee monitoring which give rise to obligations upon the employer under pertinent data protection legislation include:

  • monitoring employee faxes, emails and web browser history;
  • recording inbound and outbound calls (frequency, duration, time);
  • closed-circuit video monitoring systems; and
  • monitoring/recording the position/movement of employees and/or work vehicles through the Global Positioning System.

In all cases, employers must ensure that:

  • data is processed fairly, in accordance with the law and for specific and legitimate purposes; and
  • the data is relevant, appropriate and not excessive in relation to the purpose of the data processing.

Moreover, the Cyprus commissioner for personal data protection has issued a Directive on the Processing of Personal Data in the Sector of Employment Relationships. Under Section 14 of the directive, the following principles must be followed in instances of employee surveillance and monitoring:

  • The employer may install electronic surveillance systems at the workplace for legitimate purposes which the employer pursues, provided that these purposes supersede the rights, interests and fundamental freedoms of the employees.
  • The means/monitoring systems that the employer chooses to install and the data collected must be proportionate to the objective pursued.
  • The employer must choose the least interventionist means of monitoring in order to satisfy the pursued aims.
  • The personal data of employees collected during the monitoring stage must be used only for the purpose for which the monitoring is carried out.
  • The personal data of employees collected during the monitoring stage must be destroyed or deleted once the purpose for which the monitoring is carried out has been fulfilled.
  • The employer must in all instances inform employees before the monitoring begins of the purpose, method, duration and technical specifications of the surveillance.
  • Continual monitoring in the workplace must be avoided.
  • Secret surveillance is prohibited.
  • The employer may choose to prohibit employees from using company equipment for personal purposes, such as sending emails or making outbound telephone calls.
  • The employer must inform employees of:
    • how they can use company equipment;
    • the electronic surveillance methods which will be used; and
    • the consequences for employees resulting from the use of such equipment for personal purposes.
  • The access of the employer to the content of personal emails and personal telephone calls of employees is prohibited.
  • Employees maintain the right to protection of their private life, even in the workplace.
  • The employer must maintain a balance between this right and the degree to which the surveillance systems interfere with the private life of employees.

2.5 Are contingent worker arrangements specifically regulated?

Employment contracts in Cyprus may be for a fixed term or indefinite. If an employee is continuously employed for more than 30 months in total, his or her contract will be considered indefinite, unless the employer can show that such fixed-term employment can be justified on objective grounds, including the following:

  • The needs of the company for the specific operation are temporary;
  • The employee is replacing another employee;
  • The particularity of the work justifies a fixed term;
  • The employee is employed on probation;
  • The fixed-term employment is on the application of a judicial decision;
  • The duties of the position require a perfect physical condition; or
  • The role concerns military-related work.

3 Employment benefits

3.1 Is there a national minimum wage that must be adhered to?

In general, salary is not regulated by law and can be negotiated by the employer and employees (or their representatives) through individual or collective agreements.

However, by decree of the Council of Ministers, which will come into force on 1 January 2023, a new minimum wage has been set for all employees working in Cyprus, excluding the below categories:

  • domestic workers;
  • agricultural and livestock workers;
  • maritime workers;
  • employees who benefit from more favourable arrangements by law, contract, practice or custom;
  • employees in the hotel industry covered by the Decree on Minimum Wage in the Hotel Industry of 2020; and
  • all employees who receive training or education provided for by law, practice or custom to obtain a diploma and/or to practise a profession.

In the case of seasonal workers under 18 years of age whose duration of work does not exceed two consecutive months, the minimum wage may be reduced by 25%. Further, the minimum wage of employees whose food is covered by the employer may be reduced by 15% and when accommodation is covered by a further 10%. The employee nevertheless retains the right to terminate such an arrangement by providing 45 days' notice to the employer.

The new minimum wage for a full-time employment, as of 1 January 2023, will be set at €885 per month, which increases to €940 after six months of continuous employment with the same employer.

Currently, and before the new Decree on Minimum Wage of 2022 comes into effect in January 2023, there are certain occupations for which the minimum wage is set by a 2012 decree of the Council of Ministers. Those occupations are:

  • clerks;
  • shop assistants;
  • school assistants;
  • childcare workers; and
  • nursing assistants.

Currently, employees in the above categories are entitled to at least €870 per month, which increases to €924 after six months of continuous employment.

Security guards and cleaners of business or corporate premises are also covered by minimum wage provisions. The minimum wage for security guards was revised to an hourly rate of €4.90, and, upon completion of a six-month period of employment at the same employer, is increased to €5.20. The hourly rate of pay for newly recruited cleaners is €4.55 and, upon completion of six months of employment at the same employer, is increased to €4.84.

The 2012 decree of the Council of Ministers will be repealed on 1 January 2023 when the new decree will come into effect.

There is also an additional decree on minimum wages for 19 categories of professions within the hotel industry. Depending on the position, these vary between €870 and €1,070 per month and/or between €5.28 and €6.32 per hour.

3.2 Is there an entitlement to payment for overtime?

Compensation of overtime work is not regulated by law in Cyprus and is a matter of individual or collective agreement, except for those working in shops, hotels and leisure centres (eg, restaurants, bars and clubs), as well as civil servants and persons working for public law bodies, where specific laws and/or regulations govern this matter.

However, where specific laws or regulations or collective or individual agreements do not govern this matter, in the regular course of events:

  • the employer should obtain the consent of the employee for overtime work and pay at least at a rate of 1:1 or equivalent time off, in order to ensure that this temporary amendment to the terms of employment is duly considered; and
  • there should be no adverse impact on the employee if he or she refuses to work overtime.

Otherwise, an increase in the number of hours of work without at least a proportionate increase in pay or pertinent compensation for the additional hours of work is an adverse unilateral amendment to the agreed terms of employment, which constitutes cause for constructive dismissal under Cyprus employment law. The employer may thus be liable for damages to this effect.

3.3 Is there an entitlement to annual leave? If so, what is the minimum that employees are entitled to receive?

The Annual Holidays with Pay Law (8/1967) provides that the minimum holiday entitlement per year is 20 working days for employees working five days a week and 24 working days for employees working six days a week, provided that the employee has already worked for at least 48 weeks within the year. This is paid through the Central Holiday Fund, to which each employer contributes 8%.

Where employers opt to pay annual leave directly to employees and provide more generous terms than the law – that is, at least 21 or 25 days respectively – they are exempt from contributing to the Central Holiday Fund.

An employee is not entitled to paid annual leave if he or she has worked for fewer than 13 weeks in the year. If the employee has worked for a period of between 13 weeks and 48 weeks, he or she will be entitled to holiday pro rata. Annual leave may be accumulated for two years upon agreement between the employer and employee. This is the statutory minimum and the parties are free to agree on more generous terms for employees.

3.4 Is there a requirement to provide sick leave? If so, what is the minimum that employees are entitled to receive?

The number of days' sick leave to which an employee is entitled, and whether this is paid or unpaid, are contractual matters. Unless the employment contract provides otherwise, sick pay is paid by the Social Insurance Department for any period of three days or longer in which an employee is unable to work. The weekly entitlement is 60% of the weekly average of basic insurable earnings within the previous year, increased by:

  • one-third for the employee's first dependant (including a spouse, whether or not in employment); and
  • one-sixth for each child or other dependant.

The maximum number of days for which sick pay is payable is 156 days for each period of interrupted employment. This can be extended for a further period of 156 days during the same period of interrupted employment, provided that the insured is eligible to receive incapacity pension but is not expected to remain permanently incapacitated from working.

3.5 Is there a statutory retirement age? If so, what is it?

There is no mandatory retirement age. However, according to the Termination of Employment Law, an employee is not entitled to compensation for termination of employment or redundancy if he or she reaches pensionable age (65 years) prior to the date of termination of employment. While the regular pensionable age is 65, in certain cases and under certain conditions, early pension may start at 63; and in a few professions within the civil service, pension starts at 67.

4 Discrimination and harassment

4.1 What actions are classified as unlawfully discriminatory?

Discrimination in employment is illegal under various legislative statutes, including:

  • Law 3/1968 ratifying the Convention Relating to Discrimination (Occupation and Profession) of 1958;
  • the Equal Treatment at Work and Employment Law of 2004;
  • the Equal Pay between Men and Women for the Same Work or Work of Equal Value Law of 2002;
  • the Part-Time Employees (Prohibition of Discrimination) Law of 2002;
  • the Fixed-Term Work (Prohibition of Discrimination) Law of 2003;
  • the Equal Treatment of Persons Regardless of Racial or Ethnic Origins Law of 2004;
  • the Equal Treatment of Men and Women at Work and Vocational Training Law of 2002;
  • the Persons with Disabilities Law of 2000; and
  • the Suppression of Racial and Some Other Forms of Discrimination (Ombudsman) Law of 2004.

Protected characteristics include:

  • gender;
  • community;
  • language;
  • colour;
  • religion;
  • political or other beliefs;
  • age;
  • sexual orientation;
  • nationality;
  • racial or ethnic origin; and
  • disability.

Actions that are classified as unlawfully discriminatory, having regard to the above protected characteristics, include:

  • harassment at work;
  • an order to apply discriminatory treatment;
  • discrimination in social protection, social security and healthcare; and
  • direct or indirect discrimination in relation to:
    • access to employment, self-employment and work, including selection criteria and appointment terms, regardless of the sector of activity and at all levels of the professional hierarchy, including promotions;
    • access to all kinds and levels of professional orientation, training, education and reorientation, including obtaining practical professional experience;
    • conditions and terms of employment, including provisions on dismissals and remuneration; and
    • the capacity of a member and participation in an employees' or employers' organisation or any organisation whose members exercise a particular profession, including advantages granted by such organisation.

4.2 Are there specified groups or classifications entitled to protection?

Protected categories include all private and public sector employees who may experience direct or indirect discriminatory treatment due to one of the protected characteristics referred to in question 4.1.

4.3 What protections are employed against discrimination in the workforce?

Apart from discrimination on the grounds referred to in question 4.1, the laws of Cyprus specifically prohibit:

  • unequal payment on the grounds of sex;
  • the disproportionate treatment of part-time and fixed-term workers;
  • sexual harassment;
  • discrimination against whistleblowers; and
  • discrimination based on membership of a trade union.

4.4 How is a discrimination claim processed?

Employees may enforce their rights by filing:

  • a complaint to the Ombudsman;
  • a complaint to the police authorities requesting criminal prosecution of the wrongdoer; and/or
  • a discrimination claim before the Industrial Disputes Tribunal.

If the employee proves the existence of indications of discrimination on one of the prohibited grounds, the onus is on the employer to prove that no discrimination has occurred.

4.5 What remedies are available?

Apart from filing a complaint to the competent authorities, any employee who is discriminated against may file a claim requesting compensation for any damage sustained because of the illegal behaviour.

4.6 What protections and remedies are available against harassment, bullying and retaliation/victimisation?

The protections and remedies available against harassment and bullying are the same as those described in questions 4.3 and 4.5.

Retaliation/victimisation is also strictly prohibited under Section 10 of the Equal Treatment at Work and Employment Law; affected employees may also file civil claims for damages against the wrongdoers and/or complaints for their criminal prosecution.

5 Dismissals and terminations

5.1 Must a valid reason be given to lawfully terminate an employment contract?

Yes. After the end of the probation period, dismissals that cannot be justified under any one of the grounds below are considered unlawful per se:

  • unsatisfactory performance (excluding temporary incapacitation due to illness, injury or childbirth);
  • redundancy;
  • force majeure, act of war, civil commotion or act of God;
  • termination at the end of a fixed period;
  • conduct which renders the employee subject to summary dismissal; or
  • conduct which makes it clear that the relationship between employer and employee cannot reasonably be expected to continue, commission of a serious disciplinary or criminal offence, indecent behaviour or repeated violation or ignorance of employment rules.

There is a statutory period of 26 weeks of continuous employment, which may be extended to two years by agreement.

5.2 Is a minimum notice period required?

Yes. Written notice of termination must be given to the employee outlining the reasons for the dismissal and the effective date of termination.

According to the Termination of Employment Law, the statutory minimum notice period varies from one to eight weeks according to the employee's period of continuous employment, as follows:

  • no notice for up to 26 continuous weeks' employment;
  • one week's notice for 26 to 52 continuous weeks' employment;
  • two weeks' notice for 52 to 104 continuous weeks' employment;
  • three weeks' notice for 104 to 156 continuous weeks' employment;
  • five weeks' notice for 156 to 208 continuous weeks' employment;
  • six weeks' notice for 208 to 259 continuous weeks' employment;
  • seven weeks' notice for 260 to 311 continuous weeks' employment; and
  • eight weeks' notice for 312 continuous weeks' employment or more.

Otherwise, compensation for immediate termination can be paid in lieu of notice.

Dismissal without notice or payment in lieu of notice can take place only in the following circumstances:

  • The employee's conduct has rendered the employee subject to summary dismissal;
  • The employee's conduct indicates that the relationship between the employer and employee cannot reasonably be expected to continue under the circumstances;
  • The employee has committed a serious disciplinary or criminal offence;
  • The employee has behaved indecently; or
  • The employee has repeatedly violated or ignored employment rules.

5.3 What rights do employees have when arguing unfair dismissal?

Employees are generally protected from dismissal for any reason that is not a legally justified ground for dismissal. Furthermore, it is a criminal offence to dismiss a pregnant employee from the time of presentation with a doctor's certificate of pregnancy up to five months after the end of maternity leave. There are similar protections from dismissal for employees on paternity leave, parental leave or leave on the grounds of force majeure.

It is also illegal to dismiss an employee on leave due to an incapacity throughout the period of sick leave (up to one year) plus a further one-quarter of the sick leave period, unless certain conditions are satisfied.

Finally, an employer cannot dismiss an employee based on:

  • race;
  • gender;
  • religious beliefs;
  • nationality; or
  • social origin
  • community;
  • language;
  • colour;
  • political or other beliefs;
  • age;
  • sexual orientation;
  • ethnic origin; or
  • disability.

An unfairly dismissed employee can bring a claim for damages for unlawful or wrongful dismissal at the Industrial Disputes Tribunal, which has exclusive jurisdiction to determine matters arising from the contract of employment and termination. Please see question 5.4 for minimum payable damages, which may be aggravated on grounds of:

  • loss of career prospects;
  • age; and
  • specific circumstances surrounding the case.

Alternatively, an employee has the right to file a claim for breach of contract with the district courts if the claim exceeds the equivalent amount of two years' salary (which is the maximum amount of compensation that can be ordered by the Industrial Disputes Tribunal).

In addition, an illegally dismissed employee who has not been given notice of termination is entitled to payment in lieu of notice, which is calculated based on the scale mentioned above in question 5.2.

In case of unlawful termination of employment, and provided that the employer's total workforce exceeds 19 persons, the Industrial Disputes Tribunal can order the employer to redeploy the employee. However, this discretionary power is rarely exercised.

5.4 What rights, if any, are there to statutory severance pay?

The minimum statutory compensation for unlawful dismissal payable by the employer depends on the period of continuous employment and is calculated in the same way as compensation for redundancy. This compensation is calculated in accordance with Table 4 of the Termination of Employment Law, which provides as follows:

  • two weeks' wages for each year of service up to four years;
  • two-and-a-half weeks' wages for each year of service from five to 10 years;
  • three weeks' wages for each year of service from 11 to 15 years;
  • three-and-a-half weeks' wages for each year of service from 16 to 20 years; and
  • four weeks' wages for each year of service beyond 20 years.

In cases of lawful termination of employment due to redundancy, an employee is not entitled to compensation from the employer. In such case the employee is entitled to compensation from the state-administered Redundancy Fund, to which all employers pay monthly contributions.

The maximum amount of compensation that the Industrial Disputes Tribunal is entitled to award is two years of the claimant's salary. Depending on the circumstances of the case, the tribunal may award any amount between the minimum (which is calculated in the same way as compensation for redundancy) and the maximum (two years' salary). Before deciding, the tribunal will consider:

  • the employee's age;
  • career prospects; and
  • all circumstances of termination.

Any payment in excess of one year's wages is payable to the employee by the state-administered Redundancy Fund, not by the employer.

6 Employment tribunals

6.1 How are employment-related complaints dealt with?

The Industrial Disputes Tribunal has exclusive jurisdiction to hear and decide on disputes arising from the application of the law relating to the termination of employment. However, employees have the right to apply to a district court in relation to disputes concerning their employment where their claim is greater than the maximum amount that may be ordered by the Industrial Disputes Tribunal (two years' salary) or for any claim arising during the first 26 weeks of employment (statutory probationary period, which can be extended up to two years by agreement). Recourse to one court excludes the jurisdiction of the other.

6.2 What are the procedures and timeframes for employment-related tribunals actions?

The limitation period for bringing employment claims before the Industrial Disputes Tribunal is 12 months from the date on which the dispute arose. If an employee is dismissed due to redundancy and applies to the state-administered Redundancy Fund for compensation, he or she can also file a claim before the Industrial Disputes Tribunal within nine months of the date of receipt of the notice of rejection of the claim by the Redundancy Fund (in case of rejection). The limitation period for filing a breach of contract or torts claim (subject to certain exceptions) with the district courts is six years from the date that the cause of action arose.

7 Trends and predictions

7.1 How would you describe the current employment landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

Although Cyprus is traditionally a highly unionised country, there has been a gradual shift from collective bargaining to individual agreements and an increase in flexible forms of employment.

In the wake of the COVID-19 pandemic, there was a widespread switch to remote working, particularly in the service sector. However, employees started returning to their physical workplaces after the vaccination programme took off and this trend is expected to continue moving forward.

In addition, due to the widespread switch to remote working throughout the COVID-19 pandemic, a number of legislative gaps have been identified concerning this mode of working and the government is thus expected to propose a legislative initiative for the regulation of remote working – in fact, at European Commission level, there are already discussions on the matter.

8 Tips and traps

8.1 What are your top tips for navigating the employment regime and what potential sticking points would you highlight?

As there is a rebuttable presumption that any dismissal is unlawful until the employer proves that termination of the employment contract is justified under the limited grounds provided for in the Termination of Employment Law, more comprehensive employment contracts and internal policies are required, and employers should seek professional legal advice and guidance in advance.

Moreover, the application of the EU General Data Protection Regulation and the increase in social media use by both employees and employers require more rigorous privacy policies.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.