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LABOR LAW
209
Managerial Decisions and an Employer’s Burden of Proof in
Re-Employment Lawsuits
*
An employer may terminate a labor agreement pursuant to Article 18
of the Labor Law (hereinafter referred to as the “Law”) for a valid reason
arising out of
the
requirements of the enterprise, the workplace or the
business
. In the first instance, a managerial decision is sought for a valid
termination due to the requirements of the enterprise, the workplace, or
the business. Article 18 of the Law refers to the concept of “
requirements
of the enterprise, the workplace, or the business
”, but it does not define
the concept of “
managerial decision
”. The contents of the “
managerial
decision
” can be derived from judicial precedents. In particular, the Court
of Cassation has dealt in detail with the managerial decision concept in
its recent judicial decisions and specified the employer’s burden of proof
relating to this issue.
1.
Managerial Decision
All decisions made by the employer in its own discretion within the
scope of management rights, including termination of its employees’ labor
agreements, are considered managerial decisions.
The employer may make managerial decisions for reasons arising
within or outside the business.
•
External reasons
Reasons shown by the employer to justify a termination, where the
business does not have a direct influence are considered external
reasons. The Court of Cassation has given examples for this
concept, such as decreases in orders, difficulties in marketing,
decreases in sales and demand, a lack of raw materials, an energy
shortage, meteorological reasons, or, in case of public enterprises,
exclusion from a governmental budget. Moreover, the Court of
Cassation states that these reasons do not prove valid terminations
by themselves unless these reasons result in a surplus of staff.
•
Internal reasons
The precautions taken by the employer through its rights of
*
Article of May 2010