23rd Jun 2023
In April 2023, the House of Representatives of the Republic of Cyprus recently enacted the abovementioned Law 25(I)/2023 (hereinafter, “the Law”) implementing Directive (EU) 2019/1152 of the European Parliament and of the Council of 20 June 2019 on transparent and predictable working conditions in the European Union and repealing the Notification of the Employee by the Employer of the Terms governing the Contract or Relationship of Employment Law of 2000 (L. 100(I)/2000).
The purpose of the Law, the provisions of which are mostly identical with those of the Directive, is to improve working conditions by mandating additional information that needs to be communicated to employees for reasons of transparency and predictability, while ensuring labour market adaptability. Furthermore, the Law lays down minimum rights that apply to every worker in the Republic of Cyprus, except to workers who have an employment relationship in which their predetermined and actual working time is equal to or less than an average of three hours per week in a reference period of four consecutive weeks. We note that the provisions relating to probation, parallel employment, minimum predictability of employment, zero-hours contracts, transfers to alternative forms of employment within the same organisation, mandatory qualifications and collective agreements apply only to the private sector.
The Law poses an obligation on employers, among others, to inform workers of the essential aspects of the employment relationship, in order to secure a minimum standard of protection for employees. Such aspects include, inter alia, the identities of the parties to the employment relationship; either the title, grade, nature or category of work for which the worker is employed or a brief specification or description of the work; the date of commencement of the employment relationship; the remuneration, including the initial basic amount, any other component elements, if applicable, indicated separately, and the frequency and method of payment of the remuneration to which the worker is entitled etc. Furthermore, it is made explicit that no term of the contract or employment relationship can be less favourable to the employee than what is provided for by the applicable legislation on the subject concerned.
While the above requirements and obligations are important, perhaps the most significant change from the aspect of Cyprus Employment Law is the introduction of a maximum probationary period of six months, regardless of any laws, regulations or agreements that were in force prior to the enactment of the Law. The provisions regarding the maximum probation period do not apply to employees who are Members of the Board of Directors of legal entities. In addition, where there is a collective agreement, the social partners can agree differently
The Introduction of the above provisions changes the Cyprus Employment landscape significantly by effectively overturning the earlier two-year maximum probationary period allowed by the Termination of Employment Law of 1967 (24/1967), both from future and current employment relationships.
Zero-hours (on-demand) contracts have also now been given for the first time a legal framework. This is a form of work that has picked up in the Cypriot labour market over the last ten years, at least, but there was no framework allowing or prohibiting them. Under the Law, on-demand contracts are allowed, provided that the employee works on a casual basis and (a) the total duration of employment with the same employer does not exceed eight weeks per calendar year with a maximum continuous duration of three weeks, every time, or (b) the total duration of the continuous employment does not exceed five hours per week.
While the above provisions seem clear and do not allow room for interpretation, they raise certain questions that the House has not directly addressed. For example, where the employee has been absent from work during the probationary period, the Law enables the employer to extend the probationary period correspondingly, in relation to the duration of the absence. This provision can be characterised as ambiguous and might cause several issues while interpreting the phrase “absent from work”. Cyprus Employment Law provisions clearly protect the continuity of employment during the absence of an employee due to annual paid leave, maternity leave, sick leave etc. It is therefore unclear when and for what kind of absences the employers will be able to extend the probationary period and, thus, they should be extremely cautious in order not to violate any other employee entitlements.
Equally, the Law provides that in the case of fixed-term employment relationships, the length of the probationary period shall be proportionate to the expected duration of the contract and the nature of the work. We are of the opinion that this provision has not been fleshed out sufficiently, since it does not clarify what is the standard against which the comparison must be made, in order to ascertain what constitutes a “proportionate” probation period.
Please do contact a member of our Employment Law team, should you require more information or clarifications regarding the full scope of rights and obligations of Employees and Employers deriving for the above Law or any other Employment Law statutory provisions or regulations.
This update is for information purposes only, does not cover the full scope of the rights and obligations that arise from the Law and is not intended to constitute legal advice.