Author: Katerina Irodotou, ASSOCIATE
Court of Appeal Upholds Employee Rights in Unlawful Dismissal Case Despite Waivers
On the 23rd of May 2025, the Court of Appeal delivered a decision concerning an employment law case, namely Iron Mountain Cyprus Limited v. Vanelin Todorov Kovev (Appeal no. 49/2019), in which the Appellants (Iron Mountain) challenged the decision of the lower court to award compensation to the Defendant (Mr. Kovev) for illegal dismissal pursuant to the Termination of Employment Law (Law 24/1967), as amended to date.
More specifically, the Appellants, who were the ex-employers of the Defendant, challenged the reasoning of the lower court based on which it rejected the Appellants’ position that the Defendant, by signing two waiver letters, had waived his rights to pursue compensation for the unlawful termination of his employment. This article will not examine in depth the decision of the Court of Appeal, but it will focus on some important findings that the upper court relied on to base its decision.
The first waiver letter stated that «I solemnly declare that I have been paid all the benefits to which I am entitled to (except of the provident fund) by the company via a cheque from Hellenic Bank. I also declare that I have no other and I reserve no other claim against my employer, present or future financial and/or otherwise and I expressly waive any further claim». With a second waiver letter, which included the same wording as above, the Defendant declared that he was paid all the benefits that he was entitled to, including the provident fund.
The lower court decided that by signing the two waiver letters, the Defendant did what was requested from him by the Appellants, in order to be able to receive his provident fund and anything else that he was entitled to. Among other things, the lower court emphasised that the wording of the waiver letters did not have the necessary clarity and thus, no obstacle and/or estoppel was created, which could forbid the Defendant from filing a claim for unlawful dismissal.
To summarise, the lower court deemed that the Defendant’s waiver for «no other claim» was limited to a claim in relation to benefits that may have arisen throughout his employment and up until the time of signing the first waiver letter and not to any claim for compensation for unlawful dismissal. Similarly, in relation to the second waiver letter, the wording was limited to claims regarding the amount which the Defendant was entitled to receive from the provident fund.
The lower court made a reference to the case of Χατζηστυλλή v. Κυπριακών Αερογραμμών Λτδ (2012) 1(Β) Α.Α.Δ. 989, where it was stated that «estoppel by declaration is a rule of evidence which is founded on the principle that a clear declaration or undertaking in a document shall be understood as binding between the parties and therefore shall not be susceptible of any evidence that contradicts it».
The lower court, after taking into consideration all the evidence and after hearing the witnesses and their testimony, concluded that the wording of the above waivers did not indicate that the Defendant waived his rights to raise a claim for unlawful termination of his employment and to request compensation by the Appellants.
The Court of Appeal agreed with the lower court’s approach and stated that «we noted that the lower court took into account extrinsic testimony, in relation to what the amounts mentioned in two waiver letters concerned. We consider that it did the right thing. The said testimony was necessary for the clarification of a specific key issue, essential for the task of interpreting the disputed documents and its admission is permitted by the case law» (Μιχαήλ Στέφανος ν. Alpha Bank Ltd (2009) 1 ΑΑΔ 941).
The Court of Appeal, among other things, also stated that even «if the said waiver letters were construed properly as to waive any right of the Defendant for compensation for unlawful dismissal, such letters were void and incompatible with the respective employment regulations».
The above case is of vital importance and shows that employers cannot rely on such letters to avoid any legal consequences when unlawfully dismissing an employee. It is well established that employees’ rights are well protected by the law and the burden of proof rests in the shoulders of the employer, to show that a termination of employment was not unlawful and/or it took place in accordance with the law and the regulations, respecting all the rights of the employees.
