Reinstatement Actions in Employment Law and Their Consequences

Where the employment contract of a worker within the scope of job security is terminated by the employer without a valid reason being given, or where the reason given is not valid, the fundamental legal remedy available is the "reinstatement action". Under Employment Law No. 4857, certain preconditions must be satisfied before a worker may bring such an action. The principal conditions are that at least 30 workers are employed at the workplace, that the worker has at least six months' service, and that the employment contract is of indefinite duration.

The concept of valid reason refers to reasons arising from the worker's capability or conduct, or from the requirements of the undertaking, the workplace or the work. The employer must give notice of termination in writing and state the reason for termination clearly and definitively. The burden of proving that the reason for termination is valid rests with the employer. Grounds such as poor performance, economic contraction or restructuring are subject to close judicial scrutiny, and it is assessed whether the termination complies with the principle of last resort (ultima ratio).

Recourse to mediation with a reinstatement claim is a condition of action: the compulsory mediation process must be initiated within one month of notification of the termination. Where no agreement is reached in mediation, proceedings must be commenced before the Labour Court within two weeks of the date of the final record. As these are peremptory time limits, a worker who misses them will have the reinstatement claim dismissed.

Where the court holds the termination invalid and orders the worker's reinstatement, the worker must apply to the employer to return to work within ten working days of notification of the final decision. If the employer fails to reinstate the worker within one month, it must pay the "compensation for failure to reinstate" awarded by the court in the amount of four to eight months' wages, together with "wages for the period spent out of work" accrued for up to a maximum of four months for the period during which the worker was not employed pending finality of the decision. Since reinstatement proceedings are subject to formal requirements and strict time limits, having the process managed by legal professionals will prevent the loss of rights.