In a majority decision, Cyprus’ Supreme Court upheld a Government appeal against a ruling by the Administrative Court that austerity-driven Public Service pay cuts imposed in 2012 were unconstitutional.
Nine judges, including President, Myronas Nikolatos (pictured), voted to uphold the appeal, while four went against. Three of the four issued separate decisions.
The ruling was welcomed by the Government with a sigh of relief as dismissal of the appeal would have cost the State close to a billion euros over four years — money which would have been ever harder to find amid the COVID-19 crisis.
In its March 2019 decision, the Administrative Court had ruled that a freeze on incremental pay rises, a three per cent contribution to pensions, and a reduction in Public Servants’ pay were in violation of Article 23 of the Constitution regarding the protection of the right to property.
The judgement applied to Public Servants as well as persons employed in the broader public sector, such as semi-Governmental organisations.
Attorney-General, Costas Clerides said the Supreme Court ruling stated that reductions in Public Servants’ salaries and pensions were constitutionally permissible and legal.
“Since it is a decision of the Full Bench, it sets a precedent so that under similar circumstances the State will be able to act legally and fully in line with the Constitution,” Mr Clerides said.
The Supreme Court said the concept of salary had been clearly recognised as a property right.
However, it also established “that the right to property does not extend to a salary of a specific level”.
“Consequently, conditional changes to the level of the salary are not ruled out during critical times for the economy, provided the dignified living standard of the worker is not put in danger,” the court said.
Minister for Finance, Constantinos Petrides voiced his satisfaction over the decision, saying it validated the Government’s policy to ensure economic stability.
“The decision legally secures the Government’s policies that ensure fiscal and macro-economic stability and allow us to adhere by the European Union’s fiscal rules,” Mr Petrides said.
“It is of particular importance particularly during this period of the economic crisis, when the entire economy is trying to tackle the effects of the pandemic.”
Nicosia, 12 April 2020
