Thematic feature - individual labour/employment disputes and the courts

This article examines how individual labour/employment disputes are handled through the courts in Austria, as at March 2004.

In March 2004, the EIRO national centres in 24 European countries were asked, in response to a questionnaire, to give a brief overview of their country's system for dealing with individual labour/employment disputes through the courts, along with data on: the volume of cases; the costs; the timeframe; alternatives to going to court; and any current debate on these issues. The Austrian responses are set out below (along with the questions asked).

System

Please give a brief description of how disputes concerning individual employees' employment and labour rights are handled in your country by courts, tribunals or other official judicial bodies.

In Austria, jurisdiction in matters relating to labour and social security law falls within the purview of ordinary courts. The competent courts of first instance are the Land Courts (Landesgerichte) domiciled in each of the provinces (Länder). Each of them act as a labour and social security court (Arbeits- und Sozialgericht) along with their other areas of jurisdiction (with the sole exception of Vienna, which has a special labour and social security court). The courts of second instance are the four Higher Land Courts (Oberlandesgerichte), and the third and final instance is the Supreme Court of Justice (Oberster Gerichtshof).

All these courts hear labour and social security cases in 'senates' that are composed of both professional and lay judges; the latter are nominated by the Chambers of the Economy (Wirtschaftskammern) and the Chambers of Labour (Arbeiterkammern) and possess essentially the same powers as the professional judges. At the first-instance level, the bench consists of one professional judge and two lay judges (one each from the employers’ and the employees’ side), whereas the second- and third-instance levels have three professional judges and two lay judges. These labour and social security courts are competent to rule on all disputes arising from labour law - including disputes over employment contracts, pay, working conditions, any form of discrimination, unfair dismissal, surveillance etc - and all benefit claims arising from social security law. However, disputes concerning the social insurance relationship (such as disputes over the existence of an insurance relationship or obligation to pay contributions) are referred to the administrative authorities.

Individual disputes may be taken to court only if they arise from private-law employment relationships. In line with this, all employees (except for career public servants who enjoy a permanent tenure which carries absolute protection against dismissal) are entitled to bring such cases. Representatives of both trade unions and Chambers of Labour (and at the first-instance level, also members of a works council) may bring a case on an employee’s behalf - though only with the employee’s consent.

Depending on the kind of the dispute, the court may impose a series of actions, ranging from fines (mostly on the employer) resulting from outstanding pay etc, to changes in the current employment status of the employee (eg the employee’s reinstatement in the case of his or her unfair dismissal).

Within one week after the court’s pronouncement of judgment, either party to the dispute may give written notice of appeal against the decision to the relevant court. No later than four weeks after the delivery of the written judgment by the court, the appeal may be lodged with the competent Higher Land Court (as the competent court of appeal). If the employee is the appealing party, the appeal must be signed by either a lawyer or a specifically skilled representative of the Chamber of Labour or a trade union. The Supreme Court of Justice, as the last instance, may be appealed to solely by a lawyer (on the worker’s behalf only).

Number of cases/disputes and costs

How many cases have been dealt with in your legal system by each category of court? Where possible, please provide statistics on the number of disputes in your country each year from 1990 to 2003 (or the latest year for which data are available). Where possible, please provide statistics on costs.

Detailed quantitative data on individual dispute cases dealt with by the courts are not available. The only figures provided by the Ministry of Justice and Statistics Austria refer to the total number of first-instance cases per year in the field of labour and social security law - see table 1 and table 2.

Table 1. First-instance litigation in the field of labour law, 1995-2003
Year Pending cases brought forward New cases Closed cases Remaining cases pending
1995 6,856 20,883 20,128 7,611
2000 7,103 22,447 21,588 7,962
2002 8,216 24,955 24,090 9,081
2003 9,081 24,569 24,285 9,365
Table 2. First-instance litigation in the field of social security law, 1995-2003
Year Pending cases brought forward New cases Closed cases Remaining cases pending
1995 15,316 23,148 21,033 17,431
2000 18,870 31,447 26,787 23,530
2002 23,958 29,469 31,365 22,062
2003 22,062 26,454 28,548 19,968

Sources: Ministry of Justice and Statistics Austria.

No statistical data disaggregated by the type of dispute are available. However, according to the records of the AK, which brings most cases on behalf of employees, most labour law cases result from pay disputes and redundancies and most social security cases result from disputes over pensions and sickness benefits.

As regards litigation costs, the Association of Social Security Providers (Hauptverband der Sozialversicherungsträger, HSV) recorded a total cost of EUR 30.6 million in 2002 for first-instance litigation solely in the field of social security law - no information is available on the cost of labour law cases.

Litigation timeframe

Where possible, please provide statistics on the timeframe within which court cases over individual labour/employment disputes are settled.

See tables 1 and 2 above for the number of cases closed or otherwise each year. No information is available on how quickly individual disputes are settled.

Other means of resolving individual disputes

Is there any kind of legal mechanism forcing or encouraging the two parties (management and employees) to resolve a dispute by prior negotiation? Where there is such a mediation process foreseen, please give details. Is there any evidence that mediation has had an effect on the volume of claims handled by courts? Are there any corporate policies built into the structure of organisations in your country specifically to deal with disputes? How are the employees’ representative bodies involved in the process?

There is no legal mechanism forcing or encouraging the two parties to resolve a dispute by prior negotiation. However, in most cases, either the AK or the trade unions try to intervene (by contacting the employer) in order to bypass formal litigation before the courts. According to AK records, in most cases of such informal mediation a settlement out of court can be reached when organised labour (the AK or a union) has managed to confer with the employer. Aside from this, there is also the possibility to come to an 'arrangement mediated by the courts' (Vergleich), whereby the two parties agree upon resolving the dispute during the course of the normal litigation procedure.

Both the AK/trade unions and the WKÖ employers’ organisation have their own departments providing legal protection for their members. In particular on the employees’ side, it is usually these representative organisations that bring cases on behalf of their members, since for most employees it is too risky and costly to bring a case to court by themselves (or by way of a lawyer).

Debate

Please summarise any current debate on the issue of employment/labour disputes litigated by courts in your country.

Through the 1985 Act on the Labour and Social Security Courts (Arbeits- und Sozialgerichtsgesetz, ASGG), the Austrian legislator aimed to centralise the courts’ competencies in the area of labour and social security law and to establish a clear-cut sequence of instances topped by the Supreme Court of Justice. All relevant actors agree that this objective has been reached. Another goal was to accelerate legal proceedings in order to save costs and to enforce judgments more quickly. This would help the plaintiffs (most of whom are employees) to have their claims realised earlier. However, this effect has been neutralised in recent years, since at the same time the number of disputes taken to court has been growing significantly. Organised labour argues that this is because the current government of the conservative People’s Party (Österreichische Volkspartei, ÖVP) and the populist Freedom Party (Freiheitliche Partei Österreichs, FPÖ) has diluted several provisions of labour and social security law. For instance, it is claimed that the 2001 abolition of the statutory fund for the continued payment of remuneration in the event of an employee’s sickness (Entgeltfortzahlungsfonds) has led to a number of employers dismissing employees if they are absent from work for a longer period, since the companies would otherwise have to pay their wages and salaries over this period. As a result of this practice, many cases of unfair dismissal have been taken to the courts. Moreover, organised labour claims that social security law has become much more intricate, so that the average duration of legal procedures in this field has become notably longer. This view is shared by the body representing judges. (Georg Adam, University of Vienna)

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