Judgment No. 4195
The complaints are dismissed, as are the applications to intervene.
The complainants challenge the decision to modify the conditions governing sickness insurance for employees’ spouses.
acquired right; complaint dismissed; health insurance
Each of the complaints involves one or more of the same substantial questions, namely whether the EPO breached the complainants’ acquired rights by: (a) requiring employees to pay a sickness insurance contribution in respect of gainfully employed spouses who had previously been insured free of charge; (b) requiring spouses who have other insurance, to use the Office’s insurance only as a complementary scheme; and (c) abolishing the right of former (divorced) spouses to obtain cover under the Office’s sickness insurance scheme upon the death of the permanent employee. Accordingly, the Tribunal finds it convenient to join the complaints.
According to the established case law, all requests for review of individual decisions taken by the President must be lodged with and decided by the President. In the present cases, the challenged general decisions had to be implemented by individual decisions taken by the President of the Office. Accordingly, all requests for review had to be lodged with the President. Therefore, the appeals lodged with the Administrative Council were lawfully referred to the President for consideration (see Judgment 3700, under 12).
ILOAT Judgment(s): 3700
The Tribunal finds that none of the three measures introduced in the amendments to Article 83 breached any acquired rights. According to the case law, “[i]n Judgment 61 [...] the Tribunal held that the amendment of a rule to an official’s detriment and without his consent amounts to breach of an acquired right when the structure of the contract of appointment is disturbed or there is impairment of any fundamental term of appointment in consideration of which the official accepted appointment” (see Judgment 832, under 13). Judgment 832, under 14 (cited in part, below), poses a three-part test for determining whether the altered term is fundamental and essential. The test is as follows:
(1) What is the nature of the altered term? “It may be in the contract or in the Staff Regulations or Staff Rules or in a decision, and whereas the contract or a decision may give rise to acquired rights the regulations and rules do not necessarily do so.”
(2) What is the reason for the change? “It is material that the terms of appointment may often have to be adapted to circumstances, and there will ordinarily be no acquired right when a rule or a clause depends on variables such as the cost-of-living index or the value of the currency. Nor can the finances of the body that applies the terms of appointment be discounted.”
(3) What is the consequence of allowing or disallowing an acquired right and the effect it will have on staff pay and benefits, and how do those who plead an acquired right fare as against others?
ILOAT Judgment(s): 61, 832
In respect of the solidarity principle, and with an eye to the obligation to maintain sound financial management of the Organisation, the President proposed these new measures to balance the costs and benefits to all staff and their spouses.
[T]he Tribunal considers that the conditions under which health insurance for employees’ spouses is provided do not give rise to an acquired right. The Organisation is entitled to adjust the contribution rate if there are compelling reasons (including budgetary reasons), within reasonable limits. The Tribunal is satisfied in this case that the increased contribution rate resulting from the additional contribution for spouses is reasonable, justified and modest.
acquired right; budgetary reasons; health insurance
The complainants contend that the breach of their acquired rights also amounts to discrimination, but the Tribunal finds, as it did in a similar case, that the Organisation “has not discriminated against them: far from it. Its purpose was to remove an unfair advantage the Rules used to confer on them. Such corrective action may not be treated as breach of acquired rights even if the advantage was enjoyed for a long time” (see Judgment 1241, under 24).
ILOAT Judgment(s): 1241
acquired right; discrimination
Given that these joined complaints will be dismissed because they are unfounded, the applications to intervene must also be dismissed.