Facts
Decision
The Supreme Court recently issued a judgment concerning the entitlement to pay for the notice period (Decision KKO 2010:95). At issue was the question of whether the employment relationship may expire during the notice period in the situation in which the employee is released from his or her work obligation and takes up employment with another employer.
Facts
The shipping company Tallink Silja terminated the employment contracts of two employees for financial and production-related grounds. The two employees were released from their work obligation a few months before the end of the six-month notice period. The employees had started in another employer's service a month after being released from their work obligation and thus before the end of the notice period. The employees claimed their pay from Tallink Silja for the entire notice period.
Tallink Silja claimed that the employees were required to be at the company's disposal until the end of the notice period. According to the company, the employees could have been called back to work provided that they were given seven days' notice. Since the employees had been employed by another employer, their employment relationships with Tallink Silja had expired. The company had paid the employees' salaries until the expiry of their employment.
Decision
According to the Supreme Court, the relevant question was whether the employment relationship of the two employees with Tallink Silja had expired. In such case, the employees would not be entitled to their pay from Tallink Silja after taking up employment with another employer.
The Supreme Court started by stating that an employment relationship and the employer's payment obligation may expire in a situation where the employee is no longer able to fulfil his or her obligations as an employee. According to the court, in this case it was unclear whether the employees had been released from their work obligation unconditionally or whether the condition of being available to be called back to work had been set.
Since nothing else was shown to have been agreed, the court based its conclusions on the following reasoning.
Due to the employer's general right of supervision of work, the employer had had the right to call its employees back to work during the notice period. However, in the case at hand the employer had not used this right. Thus, it had not been shown whether the employees had been available to be called back to work even though they had taken up other employment.
Under these circumstances the court concluded that the employment relationship of the two employees could not be considered to have expired. Tallink Silja was therefore obliged to pay the employees' salaries until the end of their employment with the company.
For further information on this topic please contact Seppo Havia at Dittmar & Indrenius by telephone (+358 9 68 1700), fax (+358 9 65 2406) or email ([email protected]).