O Περί Αδειών (Πατρότητας, Γονικής, Φροντίδας, Ανωτέρας Βίας) και Ευέλικτων Ρυθμίσεων Εργασίας για την Ισορροπία μεταξύ Επαγγελματικής και Ιδιωτικής Ζωής Νόμος του 2022 (Ν. 216(Ι)/2022) (ο “Νόμος”), ο οποίος τέθηκε σε ισχύ με την έκδοση του στην Επίσημη Εφημερίδα της Δημοκρατίας την 16^η Δεκεμβρίου 2022, αποσκοπεί στην εξισορρόπηση/συμφιλίωση της επαγγελματικής με την οικογενειακή ζωή για τους εργαζόμενους γονείς ή φροντιστές, μέσω θέσπισης ατομικών δικαιωμάτων και ειδικότερα, μέσω της χορήγησης δικαιωμάτων σε:

• άδεια πατρότητας, γονική άδεια, άδεια φροντίδας και απουσία από την εργασία για λόγους

ανωτέρας βίας·

• ευέλικτες ρυθμίσεις εργασίας για τους εργαζόμενους γονείς ή τους φροντιστές.

Σύμφωνα με το άρθρο 8 του Νόμου, εργαζόμενος γονέας, ο οποίος έχει συμπληρώσει συνεχή απασχόληση διάρκειας έξι (6) μηνών στον ίδιο εργοδότη, δικαιούται να λάβει γονική άδεια. Η μέγιστη διάρκεια της γονικής άδειας είναι δεκαοκτώ (18) εβδομάδες για κάθε τέκνο, ενώ σε περίπτωση χήρου/ας γονέα ή μονού γονέα, είτε λόγω αφαίρεσης της γονικής μέριμνας από τον άλλο γονέα είτε μη αναγνώρισης του τέκνου από αυτόν, η διάρκεια της γονικής άδειας επεκτείνεται σε είκοσι τρεις (23) εβδομάδες (άρθρο 8(3) του Νόμου).

Σημειώνεται δε ότι το δικαίωμα λήψης γονικής άδειας είναι ατομικό και αμεταβίβαστο δικαίωμα για κάθε γονέα, με εξαίρεση τη δυνατότητα μεταβίβασης εννέα (9) εβδομάδων από το υπόλοιπο της άδειας του ενός γονέα στο υπόλοιπο της άδειας του άλλου γονέα.

Χρονικό Διάστημα Εξάσκησης του Δικαιώματος Γονικής Άδειας

Η γονική άδεια λαμβάνεται μεταξύ του χρονικού διαστήματος που μεσολαβεί από τη λήξη της ληφθείσας άδειας μητρότητας ή πατρότητας, ανάλογα με την περίπτωση, μέχρι το όγδοο (8^ο) έτος της ηλικίας του τέκνου, ενώ σε περίπτωση υιοθεσίας, η γονική άδεια λαμβάνεται μετά τη λήξη της άδειας μητρότητας ή πατρότητας, ανάλογα με την περίπτωση, και για περίοδο οκτώ (8) ετών από την

ημερομηνία υιοθεσίας, νοουμένου ότι το τέκνο δεν θα υπερβεί μέχρι τότε το δωδέκατο (12^ο) έτος της ηλικίας του (άρθρο 9 του Νόμου).

Σημειώνεται ότι σε περίπτωση τέκνου με αναπηρία, τηρουμένων των διατάξεων του περί Ατόμων με Αναπηρίες Νόμου, το δικαίωμα για λήψη γονικής άδειας επεκτείνεται μέχρι το δέκατο όγδοο (18^ο) έτος ηλικίας του τέκνου (άρθρο 9 του Νόμου).

Επίδομα Γονικής Άδειας

Κατά τη διάρκεια των οκτώ (8) εβδομάδων γονικής άδειας, ο εργαζόμενος γονέας δικαιούται να λάβει επίδομα γονικής άδειας, νοουμένου ότι κατά την ημερομηνία υποβολής της αίτησης έχει συμπληρώσει δώδεκα (12) μήνες απασχόλησης εντός των τελευταίων είκοσι τεσσάρων (24) μηνών (άρθρο 10(1) του Νόμου).

Σε περίπτωση τέκνου με αναπηρία, η διάρκεια του επιδόματος γονικής άδειας επεκτείνεται κατά:

• τέσσερις (4) εβδομάδες, νοουμένου ότι το τέκνο έχει πιστοποιηθεί από το Σύστημα Αξιολόγησης της Αναπηρίας και Λειτουργικότητας του Τμήματος Κοινωνικής Ενσωμάτωσης Ατόμων με Αναπηρίες, ως άτομο με σοβαρή αναπηρία ή με μέτρια νοητική αναπηρία.

• έξι (6) εβδομάδες, νοουμένου ότι το τέκνο έχει πιστοποιηθεί από το Σύστημα Αξιολόγησης της Αναπηρίας και Λειτουργικότητας του Τμήματος Κοινωνικής Ενσωμάτωσης Ατόμων με Αναπηρίες, ως άτομο με ολική αναπηρία (άρθρο 10(1) του Νόμου).

Σημειώνεται ότι το επίδομα γονικής άδειας καταβάλλεται εφόσον ικανοποιηθεί ότι πληρούνται οι όροι και προϋποθέσεις που προβλέπει ο περί Κοινωνικών Ασφαλίσεων Νόμος (άρθρο 10(2) του Νόμου).

Τρόπος Λήψης Γονικής Άδειας και Λήψη Γονικής Άδειας με Ευέλικτους Τρόπους

Σύμφωνα με το άρθρο 11(1) του Νόμου, η γονική άδεια δύναται να λαμβάνεται τμηματικά, με ελάχιστη διάρκεια μιας (1) ημέρας και μέγιστη διάρκεια πέντε (5) εβδομάδων ανά ημερολογιακό έτος. Η γονική άδεια, έπειτα από σχετική αίτηση του εργαζόμενου, δύναται εναλλακτικά να χορηγείται με ευέλικτο τρόπο που εξυπηρετεί τον ίδιο τον εργαζόμενο και τον εργοδότη του (άρθρο 11(2) του Νόμου).

Tο δικαίωμα λήψης της γονικής άδειας με ευέλικτους τρόπους περιορίζεται στη δυνατότητα λήψης αυτής με ελάχιστη περίοδο μίας (1) ημέρας. Σημειώνεται περαιτέρω ότι, το δικαίωμα του εργαζόμενου να λάβει επίδομα γονικής άδειας, δεν θίγεται από τον τρόπο λήψης της γονικής άδειας (άρθρο 11(2) του Νόμου).

Προειδοποίηση Λήψης Γονικής Άδειας

Ο εργαζόμενος ο οποίος προτίθεται να ασκήσει το δικαίωμα γονικής άδειας, προειδοποιεί τον εργοδότη του τρεις (3) εβδομάδες πριν από την ημερομηνία έναρξης της γονικής άδειας, ενημερώνοντάς τον εργοδότη για την ημερομηνία έναρξης και λήξης της εν λόγω άδειας, ενώ σε ειδικές περιπτώσεις, όπου απαιτείται η άμεση λήψη γονικής άδειας, η περίοδος της προειδοποίησης δύναται να μειωθεί, νοουμένου ότι έχει εξασφαλιστεί η προηγούμενη σύμφωνη γνώμη του εργοδότη (άρθρο 12(1) του Νόμου).

Στις περιπτώσεις λήψης της γονικής άδειας με ευέλικτους τρόπους, ο εργαζόμενος οφείλει, πέραν της προειδοποίησης προς τον εργοδότη του, να προσδιορίσει το είδος της ευελιξίας που επιθυμεί να κάνει χρήση, καθώς επίσης και το μέρος της γονικής άδειας που επιθυμεί να λάβει με ευέλικτο τρόπο (άρθρο 12(1) του Νόμου).

What is constructive dismissal?

Constructive dismissal is basically the situation where an employer has committed a serious breach of contract entitling the employee to resign in response to the employer’s conduct, by treating himself as having been dismissed by the employer.^[1] In such cases, the existing legal framework enables the treatment of the employee’s resignation as a form of unfair dismissal since the actions and/or conduct of the employer (constructive part) leads to the resignation of the employee (dismissal part).^[2]

In the British case Western Excavating (ECC) Ltd v Sharp^[3], it was stated that “If the employer is guilty of conduct which is a significant breach going to the root of the contract of employment, or which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract, then the employee is entitled to treat himself as discharged from any further performance”. If he does so and proceed with the termination of the employment contract by reason of the employer’s conduct, he is constructively dismissed.

The aforementioned legal approach is also reflected in the relevant applicable Cypriot law. More specifically, subsection 7(1) of the Termination of Employment Law of 1967 (24/1967) (the “Law”) provides that in cases where an employee legally terminates his/her employment with the employer due to the conduct of the employer, then such termination is considered as being termination of employment by the employer within the meaning of section 3 of the Law, which recognises the employee’s right to receive compensation after his/her termination of employment by the employer.

However, it must be stressed that according to subsection 7(2) of the Law, in any proceedings before the Labour Disputes Tribunal initiated pursuant to the abovementioned subsection 7(1) of the Law, it will be presumed, until proven otherwise, that the employee has not terminated his employment lawfully. This actually means that the burden of proof is on the employee to show at the Court that the conduct and/or actions of the employer amounted to a fundamental and/or serious breach of contract (usually referred to as a “repudiatory breach”) leading the employee to terminate the employment contract as a result.

What is a repudiatory breach?    

In cases of constructive dismissal, the employer’s unreasonable conduct and behaviour leading an employee to terminate the employment contract is often referred to as a “repudiatory breach”. A repudiatory breach can either be a fundamental breach of an express contractual term or a breach of the implied term of “trust and confidence” between the parties.

It must also be noted that such unreasonable treatment by the employer may either be a one-off serious breach of the employment contract (for instance, failure by an employer to pay an employee’s salary) or a continuous pattern of behaviour and/or incidents, which taken as a whole amount to a fundamental breach of the implied term of trust and confidence (for instance, persistent bullying in the workplace).

In Lewis v Motorworld Garages Ltd^[4] it was stated that “..the repudiatory conduct may consist of a series of acts or incidents, some of them perhaps quite trivial, which cumulative amount to a repudiatory breach of the implied term of the employment contract that the employer will not, without reasonable and proper cause, conduct himself in a manner calculated or likely to destroy or seriously damage the relationship of confidence between the employer and the employee”.  

In general terms, a finding that there has been conduct which amounts to a breach of the implied term of trust and confidence will inevitably mean that there has been a fundamental or repudiatory breach going necessarily to the root of contract.^[5] In Garner v Grange Furnishing Ltd,^[6] it was stated that behaviour or conduct amounting to a repudiation can be a series of small incidents over a period of time. If the employer is making it impossible for the employee to go on working, that is plainly a repudiation of the employment contract.^[7]

In the Cypriot case Louis Tourist Agency Ltd v Antigonis Elia,^[8] it was stated that the kind of an employer’s conduct and/or behaviour justifying the termination of employment by the employee is not specified in the aforementioned subsection 7(1) of the Law. However, in the aforementioned case, reference was also made to Alouet Clothing v Athanasiou,^[9] where it was held that a breach of a fundamental term of the employment contract by the employer, constitutes a conduct falling under the provisions of subsection 7(1) of the Law. Moreover, it was stated that although it is difficult, if not impossible, to exhaustively determine the employer’s misconduct falling under subsection 7(1) of the Law, such conduct must be of such nature and character as to undermine the foundation of the employer-employee relationship, whether by breach of a fundamental term of the employment contract or by conduct and/or behaviour on the part of the employer which is not compatible with the admissible relationship framework between the employer and the employee.

What is the applicable standard of assessment for a breach to be considered as a repudiatory breach of the employment contract giving rise to a claim for contrastive dismissal? Is this standard objective or subjective?

It shall be noted at this point that in order for a breach of the implied term of trust and confidence to exist, it is not necessary to be proved that the employer intended the repudiation of the contract. The function of the employment tribunal is to examine the employer’s conduct as a whole and to determine whether it is such that its cumulative effect judged reasonably and sensibly is such, that the employee cannot be expected to put up with it.^[10] Whether an employee is entitled to terminate his/her employment contract by reason of the employer’s behaviour does not depend upon whether the employer had intended the conduct to be repudiatory or could reasonably have believed that it would be accepted as such, but upon whether the employer’s conduct, viewed objectively, manifests an intention no longer to be bound by the contract.^[11] In other words, the employer’s behaviour must be such that its effect, judged reasonably, is to disable the other party from performing properly his/her duties and obligations.^[12] It is thus inferred that the applicable standard in such cases is objective and not subjective; it is that of a reasonable person. This is also reflected in Malik v BCCI,^[13] where it was stated that the conduct of the employer must impinge on the relationship between the employer and the employee, in the sense that, looked at objectively, it is likely to destroy or seriously damage the degree of trust and confidence the employee is reasonably entitled to have in his employer. This requires one to look at all the relevant circumstances.

Whether the conduct of the employer constitutes behaviour that justifies the resignation on the part of the employee, is judged by examining and assessing objectively the facts and circumstances of each individual case.

The subjective sensitivities of an employee are not taken into consideration for the purposes of such assessment.^[14]

What kind of an employer’s behaviour and/or conduct may constitute a repudiatory breach for constructive dismissal purposes?      

According to Halsbury’s Laws of England^[15], although there is no exhaustive list of behaviours and/or incidences that may give rise to a claim for constructive dismissal, it was noted that among the types of breach of contract by the employer that may support a finding of constructive dismissal are the following:

a)       A failure to pay wages or unilateral decision to cut pay;

b)      Demotion or other change in status;

c)       A change of job content not permitted or envisaged by the contract;

d)      Undermining a senior employee’s position;

e)      Change of the place of work, or breach of a mobility clause, whether express or implied;

f)        Unilateral change of working hours;

g)       Failure to ensure the employee’s safety;

h)      Breach of the term of trust and respect;

i)        Failure to follow a contractually binding disciplinary procedure;

j)        Imposition of a disciplinary measure in a disproportionate manner;

k)       Failure to provide a reasonably suitable working environment

l)        Failure to deal with grievances properly and timeously.^[16]

An offensive and derogatory behaviour towards an employee may constitute a repudiatory breach giving rise to claims for constructive dismissal. In Palmanor Ltd v Cedron^[17], it was stated that although tribunals have to be careful so as to avoid attaching great importance to words used in the heat of the moment or in anger, there comes a time when the language is such that even if the person using it is in a state of anger, an employee cannot be expected to tolerate it.

Moreover, failure of an employer to adequately support the employees in periods with increased workload may also constitute a behaviour amounting to a repudiatory breach for constructive dismissal purposes. In Seligman & Latz Ltd v Mc Hugh,^[18] the Employment Appeal Tribunal held that the employee was entitled to regard herself as having been constructively dismissed on grounds that the employers were in breach of an implied condition in her employment contract that if she were overloaded, she would have the assistance of a junior and/or apprentice hairdresser and that the breach was fundamental going to the root of the contract.

What role does the time of resignation play in cases of claims for constructive dismissal? What is the right time for an employee to tender his/her resignation in such cases?

The answer to the above question is that the timing of an employee’s resignation plays a crucial role in the outcome of a claim for constructive dismissal. In Western Excavating (ECC) Ltd v Sharp,^[19] it was stated that the employee “must make up his/her mind soon after the conduct of which he/she complains”. This is due to the fact that if the employee leaves a long period of time to lapse between the occurrence of the repudiatory breach and the time of his resignation as a result of such breach, he is quite likely to lose the right to claim that he has been constructively dismissed by the employer as he may be taken to have affirmed the employment contract and waive the repudiatory breach thereof.

In W.E. Cox Toner (International) Ltd v Crook,^[20] it was noted that an employee faced with a repudiation by his employer is in a very difficult position in the sense that if he goes to work the following day, we will himself be doing an act which is consistent with the continued existence of the contract, and he might be said to be affirming the contract. Moreover, if he then accepts his (monthly) salary (i.e. further performance by the guilty party), the risk of being held to affirm the employment contract is even greater. It was further noted that “delay might be serious, not in its own right but because any delay normally involves further performance of the contract by both parties. It is not the delay which may be fatal but what happens during this period of delay”.^[21] Mere delay, unaccompanied by any express or implied affirmation of the employment contract, does not constitute affirmation thereof, but if it is prolonged it may be evidence of an implied affirmation.^[22]

However, it must be noted at this point that if the innocent party further performs the contract to a limited extent but at the same time makes it clear that he/she is reserving his/her rights to accept the repudiation or is only continuing so as to allow the guilty party to remedy the breach, such further performance does not prejudice his right subsequently to accept the repudiation.^[23]

Moreover, in Marriot v Oxford Co-operative Society^[24] it was noted that provided that the employee makes clear his/her objection to what is being done, he/she is not to be taken to have affirmed the contract by continuing to work and be paid for a limited period of time (i.e. continue working under protest for a limited time period), even if his/her purpose is merely to enable him to find another job.

In Waltons and Mors v Dorrington^[25] it was further noted that there is no fixed time limit in which the employee must make up his mind. It depends upon all the circumstances including the employee’s length of service, the nature of the breach and whether the employee has protested at the change. It was also stated that “mere protest will not however, prevent an interference that the employee has waived the breach, although exceptionally, a clear reservation of rights might do so”.

In the Cypriot case Κώστας Mηνά v Κυπριακές Αερογραμμές Δημόσια Λτδ,^[26] the Court held that, although a not so short time period of 3⅟2 – 4 months, has lapsed from the date the breach has occurred (i.e. the unilateral change of the terms of the employment contract by the employer company), the employee had not waived the breach and/or affirmed the employment contract and concluded that the employee had been constructively dismissed. In its abovementioned decision the Employment Tribunal had taken into consideration the employee’s overall attitude during the aforesaid period of 3⅟2 – 4 months, the length of the employee’s employment with the employer company (i.e. twenty-three years), and the fact that the employee was faced with the objective difficulty in finding a job of a similar nature in Cyprus.

Is the employee’s right to a constructive dismissal claim lost permanently in cases of lapse of time?

In the latest leading case Kaur v Leeds Teaching Hospitals NHS Trust,^[27] the Court of Appeal confirmed that in cases where there has been an earlier repudiatory breach which has been affirmed by the employee, if there is subsequently conduct which taken together with the employer’s earlier fundamental breach that causes the employee to resign or plays a part in the decision of the employee to resign, the later act (which may not be itself repudiatory) effectively reactivates the earlier repudiatory breach. The employer’s further act can be described as “reviving” the employee’s right to terminate the contract. An employee who is the victim of a continuing cumulative breach, is entitled to rely on the totality of the employer’s acts notwithstanding a prior affirmation, provided the later act forms part of the series.

It was also noted that “when the threshold had been reached would of course be a matter of assessment in every case, and no one would know whether the employee had jumped either too early or too late until a tribunal ruled”.

In its judgment, the court stated that there is a five-question test for tribunals to consider when determining whether an act and/or an incident may be deemed to be a last straw, enabling an employee to claim that he/she has been constructively dismissed by his/her employer:

1. What was the most recent act (or omission) on the part of the employer which the employee says caused, or triggered, the resignation?
2. Has the employee done anything to suggest that they have accepted (or affirmed) the contract since that act?
3. If not, was that act (or omission) by itself a repudiatory breach of contract (i.e. of sufficient importance to justify resignation)?
4. If not, was it nevertheless a part of a course of conduct comprising several acts and omissions which, viewed cumulatively, amounted to a repudiatory breach of the employee’s contract by showing that all trust and confidence had been destroyed? If it was, there is no need for any separate consideration of a possible previous affirmation.
5. Did the employee resign in response (or partly in response) to that breach?

All that is required for a last straw resignation is that a series of incidents, whether or not previously affirmed, amounts to a fundamental breach of contract. In other words, further contributory acts effectively revive the employee’s right to rely upon the whole series of acts, notwithstanding the earlier affirmation(s). If the employee does not delay his/her resignation from the occurrence of the last of these incidents, his/her constructive dismissal claim may be well-founded.

In Kaur v Leeds Teaching Hospitals NHS Trust,^[28] the claimant was employed by the NHS Trust Hospitals, the Tribunal held that the entirety of the disciplinary and appeal process conducted by the employer and their outcomes were arguably reasonable and that it was not open to the claimant to wait fifteen (15) months after the incident in 2013 to rely on the appeal outcome in 2014 as the last straw entitling her to resign claiming that she has been constructively dismissed.

Is causality between the employer’s conduct and the employee’s resignation a requisite in order for an employee to be able to claim that he/she has been constructively dismissed by the employer? Does the employer’s repudiatory conduct have to be the sole cause of resignation?

Causality between the employer’s conduct and the employee’s resignation is a prerequisite in cases of constructive dismissal.

In Walker v Josiah Wedgwood & Sons Ltd,^[29] it was noted that it is at least a requisite that the employee should resign as a result of the breach of the employer’s relevant duty to him/her, and that this shall demonstrably be the case. Moreover, it was further stated that it is not sufficient if the employee resigns in circumstances which indicate some ground for his/her resignation other than the breach of the employer’s obligation to him/her. The test is whether the employee’s resignation was effectively caused by the employer’s repudiation.^[30] It is not necessary that the repudiatory breach by the employer is the sole cause of the employee’s resignation, it suffices that this is the substantive cause of the resignation.

In Jones v F Sirl & Son (Furnishers) Ltd,^[31]the employee was faced with worsened employment terms and conditions and waited three and a half weeks until she was approached by another firm that offered her a job prior to her resignation. The employee accepted the job offer and claimed that she had been constructively dismissed by the employer. The employment tribunal concluded that the resignation was in response to the job offer and not to the employer’s repudiation. The Employment Appeal Tribunal (EAT) overturned the decision of the employment tribunal and held that the employee had been constructively dismissed as a result of the repudiation of the employment contract on the part of the employer. It was also stated that the test was not what was the sole cause of resignation but rather what in fact was the effective cause.

Who bears the burden of proof in constructive dismissals claims?

The burden of proof in cases of claims for constructive dismissal is on the employee. This actually means that the employee has to show at the Court that the repudiatory conduct and/or actions of the employer left the employee with no other option than to terminate the employment contract and tender his/her resignation as a result.

As already mentioned, according to subsection 7(2) of the Law, in any proceedings before the Labour Disputes Tribunal relating to claims for constructive dismissal (pursuant to subsection 7(1) of the Law), it will be presumed, that the employee has not terminated his employment lawfully until proven otherwise by the employee.

What are the employees’ rights to damages/compensation in constructive dismissal cases?

According to subsection 7(1) of the Law, in cases of constructive dismissal, the employee is entitled to     receive damages/compensation pursuant to section 3 and Tables A and D of the Law as per below:

It is noted that paragraph 4 of Table A of the Law states that, the Employment Tribunal, has absolute discretion as to the determination of the compensation amount awarded to an employee. It is also noted that, except to what is provided above, in the determination of the compensation amount the Employment Tribunal will also take into consideration, inter alia, the following: i) the wages and any other earnings of the employee; ii) the period/duration of employment of the employee; iii) the loss of prospect of the employee in finding another job; iv) the age of the subject matter employee; v) the actual conditions of the employee’s employment termination.

What are non-solicitation clauses contained in employment contracts?

Non-solicitation clauses are contractual terms contained in employment contracts, restricting an employee from soliciting and/or canvassing, directly or indirectly, business or custom from employer’s clients, post-termination of his/her employment with the employer.

Are non-solicitation clauses easily upheld by the Courts?

It shall be stressed at this point that Courts are not willing to uphold non-solicitation clauses, unless it can be proved by the employer that he/she has a legitimate proprietary interest that needs to be protected against the employee in question and that the protection sought by the enforcement of such non-solicitation clauses goes no further than what is reasonably necessary, having regard to the circumstances and the facts of each individual case(Office Angels Ltd v Rainer-Thomas and O’Connor).It is noted that in cases where the Court is not satisfied that a non-solicitation clause meets the aforementioned requirements, it refuses to uphold the clause as, generally, any contractual term restricting an employee’s activities post-termination of his/her employment is considered to be void for being in restraint of trade and contrary to public policy (Gledhow Autoparts v Delaney).

What kind of proprietary interests are capable of being protected by the incorporation of non-solicitation clauses in employment contracts?

The legitimate proprietary interests that can be protected by the incorporation of non-solicitation clauses in employment contracts are mainly customer and trade connections. Client and trade connections actually refer to connections developed between the employee and the trading partners/customers of the employer. Is it noted that in certain cases, “client connections” may also includes potential clients (East England Schools CIC v Palmer and another). Any reference to “client connections” is actually a reference to the personal knowledge and/or power of influence and control an employee may have over the customers of the employer, to such a degree that enables him/her to take advantage of that connection in order to solicit or canvass the business or custom of his/her employer’s clients (East England Schools CIC v Palmer and another; GW Plowman & Son Ltdv Ash).Undoubtedly, in cases where an employee has dealt directly with certain clients for a period of time, he/she has knowledge and influence over the said clients. The clients develop a relationship of trust with the particular employee who, as a result, may exercise the control and influence he/she has gained over the said clients, who rely upon the employee to meet their needs, rather than on the employer’s company (East England Schools CIC v Palmer and another; GW Plowman& Son Ltd v Ash).In most of the cases, the aforementioned relationship built up between the employee and the employer’s clients was developed by the use of the resources of the employer (e.g. marketing budget).

When is a non-solicitation clause considered as being reasonable by the Courts?

Once the employer proves that he/she has indeed a legitimate proprietary interest that needs to be protected against the employee, namely his/her client connections, the employer also needs to demonstrate that the non-solicitation clause is reasonable. As already mentioned, a non-solicitation clause will only be considered as reasonable by the Court if it is proved by the employer that the clause is no wider than what is reasonably necessary for the purpose of protecting the employer’s client connections. In considering the reasonableness of the of a non-solicitation clause the Court may also take into consideration whether or not a covenant of a narrower ambit would have sufficed for the purpose of protecting the employer’s interests. In Office Angels Ltd v Rainer-Thomas and O’Connor, it was stated that a restrictive clause in one form cannot be considered to afford no more than adequate protection of the employer’s relevant legitimate interest if the evidence shows that a restrictive clause in another form, much less far-reaching and less prejudicial to the employee, would have afforded adequate protection.

Other factors that play some role in determination by the Court as to whether or not a restrictive clause is reasonable are the role, duties and responsibilities the employee had in employer’s business. Generally, the more junior the employee, the harder it may be for a restraint, namely a non-solicitation clause, to be upheld by the Court as reasonable. On the other hand, the more senior the employee and the more responsibilities he/she had, the more willing the Court is to uphold a restrictive clause as being reasonable, always taking into consideration the facts of each individual case. In Safety Net Security Ltd v Coppage, it was held that a non-solicitation clause restricting the employee from soliciting and/or canvassing, directly or indirectly, business or custom from clients of the employer for a period of six months, post-termination of his employment was considered as reasonable and was upheld by the Court as the employee had played a large role in the employer’s business as its “outward face” and he had contact with all of the employer’s clients as he had undertaken the role of director. It was stated that the employee had realistically had the power to influence all the clients with whom he had communication during his employment.

What constitutes “solicitation” of clients?

It is noted at this point that solicitation needs something more than simply informing a client of the employee’s departure. There must be an aim and an intention to acquire orders from the client and frequently requires the employee to initiate contact and communication with the client for that purpose (Baldwins (Ashby) Ltd v Maidstone).

How interpretation and construction of non-solicitation clauses affect their validity and enforceability?

The construction and interpretation of non-solicitation clauses play significant role in whether or not these will be upheld by the Court as enforceable. It must be noted that in cases where non-solicitation clauses/restrictive covenants are too wide, the Court will not be willing to interpret them in a more narrow way in order to render them valid and enforceable and will rather treat them as void and/or unenforceable (East England Schools CIC v Palmer and another).

Moreover, where a contract contains several restrictive clauses, these are treated by the Court as being severable. For instance, if a non-competition clause contained in a contract is considered as being too wide but a non-solicitation clause contained in the same contract is considered by the Court as reasonable, the Court will uphold the reasonable clause and render the other clause unenforceable.

According to the Court, the below mentioned criteria apply in order to assess whether a clause or some of the wording contained in a clause can be severed from the rest of the contract (also known as the “blue pencil” test (Tillman v Egon Zehnder Limited; East England Schools CIC v Palmer and another):

• The unenforceable wording can be removed without having to add to or modify the remaining words;
• The remaining clauses/restrictive covenants must be supported by adequate consideration;
• The removal of the unenforceable wording and/or provisions must not generate any major change in the overall effect of the restrictive covenants in the contract of employment.

Τhe role and functions of the secretary as contemplated by the Law are administrative in nature. The secretary cannot assume any executive or managerial powers in the absence of express authority from the Board of Directors of the Company.

Specifically, it is noted that a secretary must not take and/or assume any power entrusted upon the directors. For instance, the secretary cannot summon a general meeting on his/her own as he/she issues and sends notices in regards to general meetings, under the instructions of the Board of Directors.

It is noted that, exempt from certain statutory duties, the responsibilities and duties of the secretary are not stipulated by Companies Law Cap.113 (hereinafter referred to as the “Law”). The duties of the secretary are assigned to him/her either by the Articles of Association of the company, or by the contract of service signed between the secretary and the Company, or by the Board of Directors of the Company, which is the most common case. Moreover, it is mentioned that in practice, certain duties and responsibilities of the secretary are implied by a course of conduct. Ordinarily, the duties and responsibilities of the secretary include, inter alia, his/her presence at all general meetings of the Company and of the Board of Directors, keeping proper minutes of the general meetings and other proceedings, the issuance and dispatch of the necessary notices, under the instructions of the Board of Directors, to the members and other relevant persons in regards to the general meetings etc, the conduct of correspondence with the members of the Company regarding to transfers of shares, calls, forfeiture etc. Additionally, the secretary is responsible for the submission of the relevant returns to the Registrar of Companies. He/she also has the responsibility to keep the books of the Company which relate to the internal affairs thereof, such as the register of members, the register of debentures, the share ledger etc.

Statutory duties

Kindly note that the Law imposes the following statutory duties upon the Secretary:

• In respect of a public company to make the statutory declaration required prior to the commencement of business (s. 104(1) (c) and 104(2)(c) of the Law);
• To sign the annual return and the accompanying documents (s.122 of the Law);
• In case of winding up of the Company by the Court, to verify the statement to be submitted to the Official Receiver (s.224(2) of the Law);
• In respect of a receiver being appointed by debenture holders whose debentures are secured by a floating charge on substantially the whole of the Company’s assets, to verify the statement to be submitted to the receiver (s.341(2) of the Law);

It is noted at this point that according to Palmer’s Company Law (21^st edition), many of the duties imposed upon the companies by the Law, are so clearly within the province of the Secretary that default by the company to comply with such duties and/or obligations shall in appropriate occasions and circumstances give rise to liability on the part of the secretary, where the relevant applicable section(s) imposes liability upon officers in default. This may be applicable in relation to defaults in regard to the following obligations:

• To deliver a return of allotments (s.51 of the Law);
• To issue share or debenture certificates (s.78 of the Law);
• To cause the registration of charges with the Registrar of Companies (s.91 and 92 of the Law); and to keep the Company’s register of charges and make it available for inspection (s.99 and 100 of the Law);
• To publish the Company’s name outside its places of business, on its seal and on its publications (s. 103 of the Law);
• To permit the inspection of the register of members (s. 108 of the Law);
• To permit the inspection of the register of debenture holders and to forward copies and to forward copies of the trust deed (s.84 of the Law);
• To keep the register of directors and secretaries (s.192 of the Law);
• To ensure the publication of particulars with respect to directors in trade catalogues, circulars, etc. (s. 193 of the Law);
• To keep minutes (s. 139 of the Law) and to make available for inspection the minutes of the general meetings (s. 140 of the Law);
• To send out copies of the balance sheets and auditors’ reports (s. 152 of the Law).

It is mentioned that in many of the aforementioned cases, the secretary is liable to a fine in the event the Company fails to comply with its obligations under the Law. However, the conditions of criminal liability may vary. For instance, in sections 104(6) and 341(5) of the Law, the statutory provisions lay down their own criminal sanction in cases of non-compliance. On the other hand, in the instance of sections 120(2) and 78(2) of the Law, the provisions refer to the “default fine” as defined in section 375 of the Law. There are also instances, such as section 108(3) of the Law, where both a fine and a default fine are mentioned. It is noted at this point that in cases where under the applicable provision of the Law a fine is imposed on the secretary in his/her capacity as the “officer in default”, mens rea has to be proved against him/her due to the fact that section 375(2) of the Law provides that the phrase “officer in default” means an officer of the company “who knowingly and wilfully authorises or permits the default, refusal or contravention mentioned in the enactment”.

In any case, the Board of Directors of the Company has the power to dismiss the Secretary in case the secretary exercises his/her duties negligently and/or without due diligence.