Has Wrongful Dismissal been put in doubt under Maltese Law?

In two separate judgements on the 12th December, 2016, the Court of Appeal upheld appeals filed by the employer and revoked the Industrial Tribunal decisions whereby the employer had been condemned to pay compensation for unjust dismissal. The cases were separate by connected.

The Appellate Court, presided over by Judge Dr Anthony Ellul, upheld the appeals filed by Peak Leisure Limited against its dismissed employees Ashraf Jarbo and David Calleja.

The Industrial Tribunal had concluded that, in both cases, the employer had a valid reason at law to terminate the employment of its employees, however, the employer was condemned to pay compensation to each of its former employees “ghal mod degredanti li bih tkecca l-appellant”.

In the Appeals filed by the company, it was argued that the Tribunal cannot on the one hand conclude that the employer had a valid reason at law to terminate employment, and at the same time condemn payment of compensation for wrongful dismissal, as wrongful dismissal was an integral part and a form of unjust dismissal. For the Tribunal to be correct in awarding damages to the former employees, the company argued, the Tribunal had to conclude that there was a wrongful dismissal, which in terms of our law, as adopted practice by the Tribunal, was still an unjust dismissal. Once declared “just”, the Tribunal could not proceed to award damages. The employer hence argued that the Industrial Tribunal was legally incorrect in declaring a just dismissal but still award damages.

The Appellate Court upheld the employer’s arguments and possibly going one step further, concluded that once Chapter 452 of the Laws of Malta did not include a provision authorizing the Tribunal to award compensation “minhabba l-mod kif il-principal ikun ittermina l-impjieg tal-impjegat li jkun kecca”, then the fact that the Tribunal concluded that the former employee’s employment was terminated for a just cause, the Tribunal had to stop at that and had to refrain from awarding any damages for the way the termination took place.

To this effect, in both cases, the Court of Appeal annulled the parts of the Industrial Tribunal awards which had awarded compensation to the former employees for what was possibly meant to be “wrongful dismissal” and confirmed the rest of the Tribunal decisions in that the employer was legally correct in terminating the employment of the two former employees for a just and sufficient cause.

In both instances, the employer Peak Leisure Limited was assisted by Dr Ian Spiteri Bailey of SB Advocates.

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