Judgment No. 1053
Decision
1. EACH OF THE COMPLAINANTS IS ENTITLED TO REIMBURSEMENT, IN ACCORDANCE WITH THE AGENCY'S FORMER PRACTICE, OF THE UNITED STATES TAXES LEVIED ON HIS OR HER LUMP-SUM PAYMENT FROM THE UNITED NATIONS JOINT STAFF PENSION FUND, TOGETHER WITH INTEREST AT THE RATE OF 10 PER CENT A YEAR AS FROM THE DATE AT WHICH THOSE TAXES BECAME PAYABLE.
2. THE AGENCY SHALL PAY THE COMPLAINANTS COLLECTIVELY A TOTAL OF 6,000 UNITED STATES DOLLARS IN COSTS.
Summary
Extract:
In respect of tax reimbursement the IAEA took the reference in Provisional Staff Regulation 5.02(a) to "salaries or allowances paid by the Agency" to cover lump-sum payments from the United Nations Joint Staff Pension Fund between 1980 and 1989. The Tribunal holds that, "having been followed over several years,the interpretation became part of the Agency's personnel policy and had to be applied to all departing staff members who found themselves in similar circumstances. If the Agency chose to take a different view of the interpretation at a later stage, it could not in doing so break with the general principle of good faith which it is required to observe in dealings with its staff members."
Reference(s)
Organization rules reference: IAEA PROVISIONAL STAFF REGULATION 5.02(A)
Keywords
good faith; practice; staff regulations and rules; amendment to the rules; interpretation; pension; lump-sum; tax; refund
Consideration 1
Extract:
"The complaints rest on the same issues of fact insofar as the International Atomic Energy Agency's conduct is concerned and on substantially the same facts as far as the complainants' own circumstances are concerned and the issues of law are identical. The cases are therefore joined."
Keywords
joinder; identical facts; condition
Consideration 7, Summary
Extract:
When the complainants retired in 1988 they chose to take partial lump-sum payment of their pensions in the belief that United States taxes levied on those amounts would be reimbursed in keeping with a practice that remained in force until 1989. But they were denied reimbursement. As the complainants all believed the practice to be applicable when they made their choice, both the principle of non-retroactivity and that of good faith apply.
Keywords
good faith; non-retroactivity; practice; amendment to the rules; retirement; pension; pension entitlements; lump-sum; tax; refund; date
Consideration 6
Extract:
"As the Tribunal held in Judgment 421 [...], [a legal] obligation may be created by the establishment of a practice on which the staff have come to rely. Enforcement of the practice will depend on whether it was intended to have contractual effect, and that must be determined in the circumstances of each case."
Reference(s)
ILOAT Judgment(s): 421
Keywords
practice; binding character; effect
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