Judgment No. 4381
The complaint is dismissed.
The complainant challenges the changes made with respect to her salary.
icsc decision; acquired right; salary; complaint dismissed
The complainant seeks the joinder of his complaint with a complaint filed by another WFP staff member. This is not opposed by the FAO. However, as will emerge from this judgment and the judgment concerning the other staff member, different aspects of salary and different specific benefits need to be considered in both instances with potentially distinct factual and legal analyses. This results, in part, from the FAO’s pleas concerning the receivability of all aspects of the broadly framed complaint of the complainant and also that of the other staff member. Joinder is likely to confuse and obscure the real issues. The complainant appears to assume, as does the other staff member, that he can challenge in his complaint in these proceedings the cumulative effect of all the changes to salary and benefits as can the other staff member in hers. This, as discussed later, is not correct. Accordingly the complaints are not joined though some of the discussion in this judgment repeats what is said in the other.
The concept of breach of acquired rights has its genesis in the first decision given on 15 January 1929 of this Tribunal then called the Administrative Tribunal of the League of Nations. In re di Palma Castiglione v. International Labour Office, the Tribunal held: “The Administration is at liberty to establish for its staff such regulations as it may see fit, provided that it does not in any way infringe the acquired rights of any staff member.” Over the decades since, the basis for recognising and protecting acquired rights has evolved and, in particular, principles developed for demarking what are and are not such rights [...].
The applicable legal principles were recently summarised by the Tribunal in Judgment 4195, consideration 7:
“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?”
Also, as the Tribunal recently discussed in Judgment 4028, consideration 13, international civil servants are not entitled to have all the conditions of employment or retirement laid down in the provisions of the staff rules and regulations in force at the time of their recruitment applied to them throughout their career and retirement. Most of those conditions can be altered though, depending on the nature and importance of the provision in question, staff may have an acquired right to its continued application.
Jugement(s) TAOIT: 4028, 4195
It is appropriate to say something about two judgments in the UN Tribunal system although this Tribunal is not bound by them (see, for example, Judgment 3138, consideration 7). The first is a Judgment of the United Nations Dispute Tribunal (UNDT): UNDT/2017/097. The second is a Judgment of the United Nations Appeals Tribunal (UNAT) (Judgment 2018-UNAT-840) upholding an appeal against the first mentioned decision. The proceedings concerned a challenge to the unified salary scale arising from the 2015 ICSC Annual Report, that is to say, the same scale impugned in these proceedings. A central issue was whether the removal of the dependency element and the effect of its removal involved a breach of an acquired right. The UNDT’s approach led to the conclusion there had been such a breach. Generally, the UNDT’s consideration of the issue involved an orthodox application of principles accepted and applied by a multitude of international administrative tribunals including this Tribunal. The approach of the UNAT was different.
After a lengthy and detailed discussion of the facts and the authorities, the UNDT addressed the question of whether there have been breaches of an acquired right. The UNDT’s reasoning included the following elements. The salary of the affected staff was a fundamental element in the contract of employment of each. The staff had a legitimate expectation that such a fundamental element could not be changed without their consent. The right to salary necessarily extends to its quantum. The balance between the rights and obligations of the parties would be broken if an organisation was allowed to unilaterally modify the level of salary. As salaries increased over time, staff have an accrued right to be paid the newly determined salaries. The quantum of the newly determined salaries enjoys the same protection as the initial ones.
In relation to the specific position being addressed, namely the elimination of a salary with a dependency element and the creation of a unified salary scale, the UNDT reasoned as follows. The additional payment made on account of dependence was initially embedded in staff salaries which is a fundamental and essential term of employment. Accordingly it could not be unilaterally reduced or discontinued irrespective of the reason for the change or its impact. The UNDT went on to conclude that the introduction of the transitional allowance was insufficient to safeguard the acquired rights of the applicants.
The difficulty with the UNDT’s analysis is that it did not sufficiently recognise that a methodology for the calculation of payment for work done, which depends on a factor not referable to that work done, is readily amenable to change. It is to be recalled that one of the relevant considerations in assessing whether there has been a breach of an acquired right is the reason for the change.
The UNAT plainly did not accept the reasoning or conclusion of the UNDT when upholding an appeal from its decision. Much of the UNAT’s reasoning central to its decision focused on the meaning of the expression “acquired rights” in Staff Regulation 12.1 which provided that the regulations could be supplemented or amended “without prejudice to the acquired rights of members of the staff”.
Jugement(s) TAOIT: 3138
icsc decision; case law of other tribunals; un common system
[T]he Tribunal’s case law does not support an approach to determining whether an acquired right has been breached which entails the examination of an altered “package” of salary and benefits to justify a conclusion that the alteration of any given element of the package involved a violation or breach of an acquired right. The logical consequences of this approach would be that even though such an alteration to a given element may be minimal or entirely justified or both, because other changes are made to other elements of the “package” the minimal or justified alteration can be characterised as a breach of an acquired right. There is no principled basis for taking this approach though the Tribunal cannot discount the possibility that situations may arise where the effect of the alteration of a limited number of related benefits might be viewed as relevant to the characterisation of one alteration as being a breach of an acquired right.
acquired right; salary
[T]he ICSC’s reasons for the proposed changes to salaries and benefits impugned in these proceedings were rational, logical and credible. They did not involve an elimination of the benefit but the modification of how, why and in what circumstances the benefit would be paid. Their adoption by the WFP (notwithstanding opposition when being originally proposed) was in conformity with obligations arising from membership of the UN common system. This is a valid reason for change (see Judgment 1446, consideration 14), at least in the absence of any apparent unlawfulness attending the change either procedurally or substantively.
Jugement(s) TAOIT: 1446
icsc decision; salary
The Tribunal’s case law recognises that the alteration of a benefit can operate to the detriment of staff and this, of itself, does not constitute the breach of an acquired right. A further element was needed, as discussed in the opening paragraph of the quotation in consideration 10: the complainant should have demonstrated that the structure of the employment contract was disturbed and that the modifications impaired a fundamental term of appointment in consideration of which he accepted employment. The complainant has not demonstrated, to the Tribunal’s satisfaction, that this further element exists in the present case in relation to the changes impugned in these proceedings.
[T]he complainant bears the burden of establishing her case (see, for example, Judgments 4094, consideration 17, and 3912, consideration 13). In many respects her pleas are vague and unclear. For example, the basis on which she had, historically, been receiving the dependency rate of pay is not articulated with any precision. It appears from observations in her brief that it was not because she had a dependent spouse but rather dependent children. But she does not establish her calculations of potential future loss as a result of the abolition of the dependency rate are well founded, because, having regard to the age and circumstances of her children, she would have been entitled to the dependency rate for the entire period the transitional arrangements would operate. It would only be in the context of clearly articulated argument by reference to proven or uncontroversial facts, the Tribunal might reach a level of satisfaction that indeed acquired rights have been breached. It would be a large step for the Tribunal to do so and could only be done on a firm foundation.
Jugement(s) TAOIT: 3912, 4094
burden of proof; acquired right