Cyprus | Worker Participation

Country overview

No specific national debate on transposition.

There was no specific national debate on the transposition of the directive into national law, although there has been more general interest in the information and consultation rights workers in Cyprus have gained as a result of the country joining the EU in May 2004. As with other legislation on employment issues, the draft text proposed by the government was initially discussed in the Tripartite Advisory Committee, which includes representatives of both unions and employers. There is no legal basis for employee board-level representation in Cyprus, although sometimes trade unionists are appointed to the boards of state-owned and partially state-owned companies.

Directive was transposed by law in December 2004, not long after the October 2004 deadline.

The directive on employee involvement in European companies was transposed through the following legislation published on 31 December 2004: Act No 277(1) of 2004 supplementing the Statute for a European company with regard to the involvement of employees with a view to enhancing employees' rights to participate in management and decisions concerning the European public limited-liability company (SE).

Separate legislation was passed to adapt company law in Cyprus to the Regulation on European companies in 2006

Special negotiating body (SNB)

Cypriot members of the SNB are chosen by the existing union or through direct elections.

Where there are trade unions representing employees, it is these organisations which elect the Cypriot members of the SNB. It is only where there is no such union body that Cypriot SNB members are chosen by direct election of all employees (Para. 7). The legislation goes on to repeat the statement in the directive that “employees in undertakings or establishments in which there are no employee representatives through no fault of their own have the right to elect or appoint members of the special negotiating body”.

There is no reference in the legislation which either explicitly permits or prohibits the presence of external union representatives on the SNB.

The Cypriot legislation says nothing about whether external trade union representatives may be SNB members. However, the fact that it is trade union organisations which choose SNB members in the first instance may mean that in some cases they may choose full-time union officials.

Costs are limited to a single expert.

The legislation states that “the costs of an expert appointed by the special negotiating body with a view to assisting it in its duties” are to borne by the participating companies (Para. 8).

Standard rules under the fallback procedure

Cypriot members of the SE representative body are chosen in the same way as Cypriot members of the SNB – initially by the union, and if there is no union through direct elections.

The procedure for allocating seats on the SE representative body – known simply as “the representative body” in the Cypriot legislation, is the same as the procedure for choosing SNB members. In other words, they are elected by the union if there is one which represents the employees and by direct election if there is no union present (see section on SNB) (Para. 12).

The budget arrangements for the SE representative body are the same as those for the SNB.

The Cypriot legislation states that the costs of the representative body should be borne by the European company in the same way that the participating companies bear the costs of the SNB (Para. 14). This includes the administrative expenses necessary to enable the representative body to be able to “carry out its task in an appropriate manner,” including the cost of at least one expert of its choice.

Board seats are allocated by the representative body.

It is the representative body which decides on the distribution of board level seats – this applies whether it is a one-tier or two-tier system – as well as on the way that SE employees “may recommend or oppose” appointments of employee representatives to these bodies (Para. 15). There is no specific reference in the legislation to the way that board members from Cyprus should be chosen.

Misuse of procedures and structural change

Misuse of procedures is outlawed but there is no indication of what misuse of procedures might involve.

The legislation states only that “no European company (SE) may deprive employees of their right to participate in that company or deny them that right” (Para 19). However, in contrast to the situation in some member states, it does not indicate how this might occur or how it might be ascertained that this had occurred.

Structural change is not referred to.

The legislation makes no references to structural changes which might require an existing European company to renegotiate its agreement on employee involvement.

No concern expressed by either employers or unions.

The European company legislation has not provoked any concern in Cyprus, either on the part of the unions or the employers.

SEEurope report

Dr Christos A. Ioannou (CIRN, Athens University of Economics and Business)

Late in 2004 Cyprus joined the group of Member States which have transposed the SE Directive. As regards transposition, it is worth describing the process by which social-policy and employment-related legislation is formulated. In preparation for implementing Regulation 2157/2001 and transposing Directive 2001/86/EU, the Department of Industrial Relations at the Ministry of Labour drafted a law in the summer of 2004.

The draft law was introduced for a first reading in the Tripartite Advisory Committee (Ergatiko Symvouleytiko Soma) – which incorporates the main social partner representatives – early in September 2004. After going through the Tripartite Advisory Committee the draft law was submitted for scrutiny by the legal service and a proposal was subsequently submitted to the Council of Ministers. The Council of Ministers endorsed the draft law and forwarded it to the Parliament. The Law was accepted in one of the last parliamentary sessions of 2004.