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Employee Transfer Agreement

Iason Skouzos & Partners > Practice Areas  > Labor & Employment  > Employee Transfer Agreement

Employee Transfer Agreement

The combined meaning of article 651 Civil Code which states that “unless something else applies on the basis of the agreement or the circumstances, the employer must fulfill his obligation personally and the employer’s claim is not alienable” and 361 & 648 Civil Code, suggests that an agreement, according to which the employer who has the employee’s services at his disposal can concede his claim for the said services to another person with the employee’s consent (which can be provided in whatever way, explicitly or implicitly, to the original or the subsequent employer), insofar as this relationship is based on the will of all three parties.

The employment contract with the original employer is not terminated and the old employer retains his status, while the new one acquires said status, which means that the employer’s status is dichotomized, and the employer’s competences are consequentially divided between the two employers.

The time length of the transfer is irrelevant, as the bond with the original employer is not severed, with the later remaining obliged to fulfill his contractual obligations, particularly, unless otherwise agreed, to pay wages and other benefits, while the subsequent employer exerts the employer’s power with the same content and restrictions the original employer would.

The above are not contrasting to the provision of article 651 Civil Code which states that the employer’s claim to the work provided by the employee cannot be transferred, since such transfer is only possible after the employee’s consent, as this prerequisite derives from the combination of the articles mentioned.

Solely beholden for the payment of the wages is the original employer according to the employment contract, due to the fact that the contract is not amended as far as this part is concerned, except if a different special agreement comes into place. On the other hand, unless it is otherwise agreed,  the original employer does not have to pay for illegal overtime work provided to the new employer, because this illegal type of work is not included in the employment contract and thus it is not binding to the parties, but it has to do with the relationship with the new employer.

Finally, the employee’s consent can be explicit or implicit, which means that it can be implied by his behavior, as it happens for example when the employee provides his work to the new employer. The transfer contract does not interfere with the employment contract. The employer’s power that passes to the new employer cannot contradict the contract that has been signed with the original employer. The contractual terms between the original employer and the employee also bind the new employer, who is not able to change them to the worse. What is more, only the original employer can terminate the contract and rights and obligations that have been born during the transfer period and are not included in the original contract, unless otherwise agreed, are binding only for the employee and the new employer (Supr. Court 482/1979).

Consequentially, what used to happen during the provision of work to the original employer, even if there is an agreement obliging the new one to pay the wages, is still mandatory not only for the later, but also for the original employer, except if there is a special and explicit agreement about his discharge, since such an agreement would constitute an amendment to the original contract.

The above mentioned “original employee’s transfer agreement” is different from the “non-original employee’s transfer agreement” that is governed by the provisions of articles 20 and on of Law 2956/2001, which have introduced the Temporary Occupation Companies, the employees of which do not provide their work to them but to third parties indicated by the company-original employer.(Supr. Court 800/2014, Supr. Court 17/2012, Supr. Court 1580/2012, Supr. Court 1009/2010).