1. Introduction
To keep up with modernization and the constant changes in the working environment, Cyprus has transposed the provisions of the EU Directive 2019/1152 (the “Directive”) of the European Parliament into its Employment Laws.
As a result, the Transparent and Predictable Working Conditions Law of 2023 (25(I)/2023) (the “Law”), was entered into force on 13/04/2023, repealing the Notification of the Employee by the Employer of the Terms governing the Contract or Relationship of Employment Law of 2000 (10(I)/2000).
The Law mirrors the provisions of the Directive and aims to improve working conditions and to make them transparent and predictable. The Law introduces minimum rights for the employees and imposes new obligations on the employers in relation to the information to be provided to the employees about their working conditions.
The Law does not apply to employees whose predetermined total employment period does not exceed three (3) hours per week or less in a reference period of four consecutive weeks.
2. Obligation to provide information
Each employer must inform, in writing, its employees about the essential terms of their employment relationship. The information shall be provided and transmitted on paper or, provided that the information is accessible to the employee and can be stored and printed. The employer must keep proof of delivery of the transmission and receipt of the said information.
The obligation of the employer to provide such information is clearly identified within the Law and can be summarized as follows:
(1) The identity of the parties;
(2) The place of work and the registered office of the business or the home address of the employer;
(3) The title, position, nature or category of the work of the employee or a description of such work;
(4) The commencement date of the employment relationship;
(5) The termination date of the employment relationship or the predicted duration of the same in the event it relates to fixed-term employment relationship;
(6) In the case of temporary agency employees, the identity of the user undertakings, when and as soon as known;
(7) The duration and conditions of the probation period (if applicable);
(8) The training entitlement provided by the employer, if any;
(9) The amount of paid leave to which the employee is entitled or, where this cannot be indicated when the information is given, the procedures for allocating and determining such leave;
(10) The procedure to be observed by the employer and the employee, including the formal requirements and the notice periods, where their employment relationship is terminated or, where the length of the notice periods cannot be indicated when the information is given, the method for determining such notice periods;
(11) The remuneration, including the basic salary, any other component elements, if applicable, indicated separately, and the frequency and method of payment of the remuneration to which the employee is entitled;
(12) If the work pattern is entirely or mostly predictable, the length of the employee’s standard working day or week and any arrangements for overtime and its remuneration and, where applicable, any arrangements for shift changes;
(13) If the work pattern is entirely or mostly unpredictable, the employer shall inform the employee of:
(i) the principle that the work schedule is variable, the number of guaranteed paid hours and the remuneration for work performed in addition to those guaranteed hours;
(ii) the reference hours and days within which the employee may be required to work;
(iii) the minimum notice period to which the employee is entitled before the start of a work assignment and, where applicable, the deadline for cancellation referred to in Article 17(3) of the Law;
(14) Any collective agreements governing the employee’s conditions of work or in the case of collective agreements concluded outside the business by special joint bodies or institutions, the name of such bodies or institutions within which the agreements were concluded;
(15) Where it is the responsibility of the employer, the identity of the social security institutions receiving the social contributions attached to the employment relationship and any protection relating to social security provided by the employer.
The Law provides certain timeframes for providing the information to the employees. In particular, points (1) to (5), (7), (11) to (13) above, must be provided before the commencement of the employment contract or within a maximum of seven days from the commencement of employment.
Any additional information, specifically relating to items (6), (8), (9), (10), (14) and (15) above, shall be given within one month from the commencement of the employment.
3. Probation Period
The most significant change from 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.
The Introduction of the above provisions significantly changes the Cyprus Employment landscape 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.
For fixed-term contracts, the duration of the probation period must be proportionate. In cases where an employee was absent from work during the probationary period, it can be extended based on the duration of the absence.
4. Parallel Employment
Careful consideration should also be given to any parallel employment provisions in employment terms. The Law provides that an employer cannot prevent an employee from working for another employer, outside their work schedule or treat an employee adversely due to this. The exception is where the restriction imposed is proportionate and based on objective grounds such as (a) health and safety, (b) protection of trade secrets, (c) avoidance of conflict of interest.
Given that the Law does not create an overall ban, it is advised that employers update their contractual clauses, conflict of interest policies, and non-compete agreements.
5. On-demand Contract
Zero-hours (on-demand) contracts have also now been introduced in the Cyprus Employment framework. This form of work has picked up in the Cypriot labour market over the last ten years, 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.
The Law allows on-demand or similar employment contracts that working hours are not predetermined, including zero-hour contracts, under which the employer has the flexibility of calling the employee to work as and when needed, provided that the employee works on a casual basis as defined in the Law.
It is worth noting here that the Law does not apply to employment relationships with agreed and actual working hours of an average of three hours per week or less in a reference period of four consecutive weeks.
6. Additional provisions
Some additional rights that have been introduced are:
(1) an employee who has completed the probation period may request a form of employment with more predictable and secure working conditions;
(2) if an employer is required by law or collective agreement to provide training necessary for carrying out the work, such training shall be provided free of cost and shall count as working time. Where possible, this training should take place during working hours; and
(3) violation of any of the provisions of the Law shall render them liable, in case of conviction, for a fine not exceeding €5,500.
7. Action
Given the new Law, as well as other recent legislative amendments, we urge all employers to:
(1) Review their employment contracts (existing and template contracts) to ensure compliance and implementation;
(2) Review their probationary periods and ensure that there are adequate controls in place to monitor and assess performance during a six-month probationary period;
(3) Where applicable, review workplace training requirements;
(4) Ensure employees are provided with the necessary information within the correct timeframes; and
(5) Review parallel work clauses as well as conflict of interest policies and non- compete agreements with employees.
8. Our Services - Lytras & Associates LLC
Our expertise includes a plethora of employment matters, advising on recruitment, termination, disciplinary and grievance procedures, employer policies and regulations, redundancy, share option and reward schemes, immigration, data protection at work, on the labor aspects of all corporate restructurings, drafting employment contracts and develop and implement handbooks and company policies.
Our Employment team regularly advises a wide range of local and international organizations as well as individuals on all matters of employment law including complex and high-value employment matters.
Please contact us if you are interested in the following:
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The content of this article is valid as of the date of its first publication. It is only intended to provide a brief introduction to the particular subject matter. Detailed specialist advice should be taken prior to taking or refraining from taking any action as a result of the information contained in this article.
