On 18 January 2024, the Court of Justice of the EU ruled on a preliminary ruling in an employment dispute between a disabled employee and the employer who terminated his employment on the grounds of permanent incapacity for work.

Summary of the circumstances of the case

An employee working in Spain as a lorry driver for the collection of mixed municipal waste suffered an accident at work four years after he started work. As a result of this injury, he suffered an open fracture of the heel bone.

The employee was on temporary incapacity for work, which was terminated by a decision of the Spanish National Social Security Office. The Office awarded the employee lump-sum compensation for permanent impairment, but declined to award permanent disability. The employee was subsequently reassigned by his employer, at his request, to another job that was physically less demanding.

In the end, the court awarded the employee total permanent incapacity to perform his usual occupation, as well as a monthly allowance of 55% of his daily wage. The employer subsequently notified the employee of the termination of his employment contract for this reason.

The employee decided to defend himself against this in court, but the action was dismissed on the grounds that an admission of total permanent incapacity to perform the usual occupation is a statutory ground for dismissal without the employer being bound by any legal obligation to reassign the employee to another job within the company.

European legislation and CJEU conclusions

The Court finds that in the present case the employee falls within the category of disabled persons within the meaning of Directive 2000/78/EC[1] (“the Directive”). The employee’s permanent physical impairment caused a limitation of his ability to work and constituted an obstacle to his full participation in working life.

The EU Charter of Fundamental Rights (“the Charter”) defines the right of persons with disabilities to, among other things, social and occupational inclusion, while prohibiting discrimination on the grounds of disability.[2] Discrimination in this sense includes denial of reasonable accommodation.

The Directive states that “in order to guarantee compliance with the principle of equal treatment in relation to persons with disabilities, reasonable accommodation shall be provided for them”. [3] Where the particular situation so requires, the employer must take effective and practical measures to enable the disabled person to access, perform or advance in employment. Such a measure may include, for example, reassigning the employee to another job. However, it is important to note that the employer cannot be forced to take measures that would impose a disproportionate burden on the employer (for example, in terms of financial costs).

The Court concludes that the national legislation in Spain is contrary to Article 5 of the Directive, read in conjunction with Articles 21 and 26 of the Charter, as it allows the dismissal of an employee on the grounds of a disability caused in the course of employment. At the same time, it does not provide for an employer’s obligation to first:

1. make a reasonable arrangement to enable the employee to retain employment, or
2. at least demonstrate that such an arrangement would impose an undue burden on the employer.

The CJEU stressed that Member States must respect the intended objective of Article 5 of the Directive in conjunction with Articles 21 and 26 of the Charter, which is to ensure the right to work (and to remain in employment) also for persons with disabilities. While it is within the competence of each Member State to regulate the system and determine the conditions for the provision of social security benefits, the State concerned is obliged to take into account the principles and assumptions contained in European legislation.[4]

Would the Czech Labour Code hold up, or is there a potential problem looming over the Czech Republic?

Finally, it is appropriate to ask if the Czech legislation complies with the requirements of the Directive in the light of the interpretation of the CJEU decision.

If the employee is no longer able to perform his/her current work due to an accident at work, the employer may terminate the employment relationship with the employee by giving notice pursuant to Section 52(d) of the Labour Code[5]. However, the employer is not obliged to try to transfer the employee to another job in the first place (or to prove that this would impose a disproportionate burden on the employer) and only as a last resort to give the employee notice[6]. It can therefore be assumed that the Czech legal order does not comply with the requirements of European legislation concerning the security of the right to work.

How will legislators deal with the verdict of the CJEU and the possible conflict between Czech law and EU law? Will this judgment trigger the need for further amendments to the Labour Code, which will introduce new obligations for employers? We will continue to monitor this issue for you.

[1] Council Directive 2000/78/EC of 27 November 2000 establishing a general framework for equal treatment in employment and occupation

[2] see Article 21 in conjunction with Article 26 of the EU Charter of Fundamental Rights

[3] Article 5 of Council Directive 2000/78/EC of 27 November 2000 establishing a general framework for equal treatment in employment and occupation

[4] See Judgment of the Court of Justice of the EU of 18 January 2024, J.M. A.R. v Ca Na Negreta SA, C-631/22, ECLI:EU:C:2024:53, paragraph 54.

[5] Act No. 262/2006 Coll., Labour Code

[6]see, for example, the Judgment of the Supreme Court of 30 January 2018, Case No. 21 Cdo 5825/2016 and the Resolution of the Supreme Court of 11 March 2016, Case No.  21 Cdo 1276/2016