European Union Court of Justice: Decision on the reason of dismissal in case of fix-term contract

The Court of Justice of the European Union (CJEU) on 20 February 20 2024 addressed the disparity in dismissal protocols between fixed-term and permanent contracts under Directive 1999/70/EC.
The CJEU reaffirmed the principle of non-discrimination, stipulating that fixed-term workers should not be treated less favourably than permanent workers in terms of dismissal procedures, emphasising the need for a uniform approach in the dismissal of employees regardless of contract type.
The case, identified as C-715/20, arose from a preliminary request by the District Court for Kraków-Nowa Huta, Poland.

What did the CJEU rule on February 20, 2024 regarding fixed-term employment contracts?

The Court of Justice of the European Union ruled that fixed-term workers should not be treated less favourably in dismissal procedures than permanent workers. This decision stems from case C-715/20 and aligns with the principles of non-discrimination under Directive 1999/70/EC and the Framework Agreement on Fixed-term Work.

How does this ruling affect the treatment of fixed-term employees upon dismissal?

Employers are now required to provide reasons for terminating fixed-term contracts, similar to the obligations they have for indefinite contracts. This change aims to ensure transparency and fairness, preventing discriminatory or arbitrary dismissals.

What does the CJEU say about the judicial review and protection of the rights of workers?

The court emphasised that all workers, regardless of contract type, should have access to judicial review to contest dismissals. This strengthens the enforcement of the fundamental rights guaranteed under Article 47 of the Charter of Fundamental Rights of the European Union.

What implications does this ruling have for employers using fixed-term contracts?

Employers will need to review and potentially revise their employment practices to ensure compliance with this ruling. They must now justify terminations of fixed-term contracts with clear, objective reasons and prepare for possible legal challenges. This requirement increases the administrative burden but promotes a fairer treatment of all employees.

What are the potential challenges for employers following this decision?

The main challenge for employers is the increased need for careful documentation and justification of dismissal reasons, which could lead to more rigorous HR practices. Employers may face increased legal scrutiny and must be prepared to defend their decisions in court, reflecting the greater protections now afforded to fixed-term workers.

What should employers do in response to this ruling?

Employers should ensure that their dismissal procedures for all types of contracts are aligned with this new legal framework. It is advisable to train HR personnel on these changes and to update employment policies to avoid legal pitfalls and to uphold the rights of all workers effectively.