BRIEF

Complaint against the adverse decision CA/D 10/14

adopted by the Administrative Council of the European
Patent
Organisation,
which,
apart
from
further
implications
materialized
through
the
individual
implementation of a series of harmful provisions contained
in it, had the direct and immediate effect of the
abolishment of recognition of accumulated experience
prior to 1.1.2015 for the purpose of automatic
advancement to the next higher (and subsequent)
horizontal remuneration step(s) within the Complainants
valid grade at the date at which the decision was made
A. SUMMARY OF FACTS
(i) At the Presidents recommendation, in its 142nd meeting of
December 2014, the Administrative Council of the EPO, with its
decision CA/D 10/14 adopted a new, single spine career system
comprising 17 grades ranging from G1 (lowest) to G17 (highest
grade) (ANNEX 6). This decision took effect as from 1.1.2015 and
comprised a series of provisions, which were implemented at two
stages. The first stage began on 1.1.2015 and the second stage
began on 1.7.2015.
(ii) In the first stage, decision CA/D 10/14 had the direct and
immediate effect that for each individual EPO employee, her/his
accumulated experience on monthly basis ceased being taken into
account for the purpose of that employees advancement to the
next higher horizontal step after acquiring additional experience
of 12 or 24 months depending on the employees seniority level at
the grade assigned to her/him. That element of decision CA/D
10/14 was implemented directly (i.e. without any supplementary
individual decision) as from 1.1.2015 as readily recognized
through inspection of the data shown in a typical example (after
deletion of personal information) in ANNEX 8. In ANNEX 8, a
comparison is made of the relevant data affecting an employees
remuneration in December 2014 and in January 2015 reproduced
in the corresponding pay slips. As seen at the top right of the pay
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slip of December 2014 (ANNEX 8, page 1), 10 months of

accrued seniority at grade A4, step 10 is recorded. In the pay
slip of January 2015 (ANNEX 8, page 2), the accrued seniority of
meanwhile 11 months - is no longer recorded on the pay slip as
the direct consequence of the impugned decision CA/D 10/14.
Hence, retroactive elimination of earlier recognised seniority took
effect as from 1.1.2015 and that state was frozen until June
2015 (ANNEX 8, page 3). As per July 2015, transposition took
place from grade A4 step 10 (net salary 10.789.49) to a new
grade of lower net salary, vis. grade G13 step 1 (ANNEX 8,
pages 3 to 6). Therefore, the number of months of accumulated
experience that should have been taken into account for the
automatic advancement to the next higher horizontal step upon
completion of 12 (respectively 24) months of experience at the
current step stopped being recorded and ceased being taken into
consideration
for
the
purpose
of
automatic
seniority
advancements as from 1.1.2015 as the direct consequence of
decision CA/D 10/14 without any further individual, implementing
decision by the President of the EPO (emphasis added). On the
other hand, the pay slips per se have the character of
implemented decisions.
In a second stage, the individual situation of each staff member
was separately examined and as per 1.7.2015 that staff member
was notified about her/his transposition to a specific G-grade and
step (ANNEX 8, pages 3 to 5). Former A4(2) employees of higher
seniority have however not been transposed to any grade in the
new career system as rendered clear in Article 57(1) and in the
Table at page 26/28 of Decision CA/D 10/14 (ANNEX 6).
(iii) The deprived automatic advancement to the next higher
horizontal step as from 1.1.2015 is a major, but not the sole,
contested element of decision CA/D 10/14. While the present
Complainant has there through experienced substantial financial
harm, the challenged decision CA/D 10/14 grants undue financial
benefits to individual members of higher management, inter alia
to certain employees involved in the design of the new career
system (cf. details under points 18-20 of the INSERT, infra). In the
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light of such considerations, decision CA/D 10/14 should be

deemed to be at odds with the principle of proportionality as
from the date it took effect, vis. as from 1.1.2015.
(iv) Due to the above and additional reasons exposed in detail
below, the Complainant filed a Request for Review directly with
the Administrative Council of the EPO, which is the appointing
Authority that took the contested decision CA/D 10/14 requesting
its annulment ab initio and in toto. The relevant background and
the compelling grounds behind the request for the annulment of
the career system in the form specified in CA/D 10/14 were
exposed in the respective request filed with the Administrative
Council. Unfortunately, the Council rejected that Request for
review for allegedly being irreceivable without any examination of
the merits, as communicated to the Complainant on 14 July 2015
by the Chairman of the Administrative Council (ANNEX 7). The
decision recited in ANNEX 7 is final and may thus be challenged
before the Administrative Tribunal of the ILO. Since, the material
grounds submitted to the Administrative Council in support of the
present Complaint were not taken into consideration at all, the
same grounds are currently re-submitted to this Tribunal, partly
mutatis mutandis, in part B below (cf. points 1 to 29).
(v) Let aside any other considerations, the present complaint
should be deemed receivable at least due to the adverse effect
discussed in paragraph (ii), which should be convincing that the
Complainant had a valid cause of action for filing a request for
review directly with Administrative Council within a period of 3
months after decision CA/D 10/14 was made in view of the
material harm caused as from 1.1.2015. The rejection of the
Complainants request for review without examination of the
merits (cf. ANNEX 7) should hence be deemed as a decision
taken ultra vires and against the principle of due process, since it
deprives the present Complainant from his fundamental right of
having his case properly examined by a first quasi-judicial
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Instance, vis. a properly constituted Appeals Committee, before

having recourse to the Administrative Tribunal of the ILO.
(vi) The explanations recited in part B provide a comprehensive
overview of the relevant facts and associated grounds for the
original request for review and for the present complaint. Some
supplementary considerations are adduced in parts C and D,
which concern procedural and financial aspects and the relief
sought through the present complaint.

B.

Detailed Considerations

I.INTRODUCTION
1. In its 127th meeting the Administrative Council was confronted with the HR-Roadmap
document CA/110/11, in which a financial analysis worked out by Deloitte was presented,
while exploring ideas intending to adopt a global financial scheme for the EPO that would
2.

ensure its long term financial sustainability.

Since then, several discussions have taken place between the EPO Administration and the
Heads of Delegations of the Contracting States addressing major issues tackled in
document CA/110/11 including the re-consideration of the Pension Scheme Regulations
for EPO staff which had been modified after a series of contentious decisions in the years
2007 and 2008. It was contemplated to design and introduce an amended career scheme
inspired by changes performed in other International Organisations including the

3.

Commission of the European Union.

In the case of the European Union, a HIGH-LEVEL NEGOTIATING BODY had
been entrusted with the core work, which elaborated a career reform concept capable to
meet the financial requirement of the enlarged Union, while respecting the necessary
level of acquired rights as quoted below (ANNEX 1):

All the members of the Body consider that, if a new career

structure is introduced, it is vital that the following guarantees
be obtained:
individual guarantees on the maintenance of income levels when the
new system is introduced and guarantees on salary increases for each
official up to the level of the final step of his or her grade in the current
structure;
overall statutory guarantees in the form of minimum percentage
promotion rates. The Body stresses that the budgetary consequences of
such guarantees must, at least, correspond to those of the current
system arising from the provisions of the Staff Regulations on automatic
salary increases by step increments and historical promotion rates, based
essentially on 'turnover';
in accordance with the above, the new system must guarantee the
same overall
income, throughout their career, to officials who perform well.
The new system in which promotion is based on merit and
performance is reflected in the Service Regulations which entered into
force on 1st May 2004.

A system foreseeing expected annual

promotion rates from 20% to 33% in the various categories and

grades got in force; an appropriate pay multiplier is foreseen such that
the acquired rights (individual guarantees) mentioned above could be
respected (cf. extract of the respective Service Regulations, ANNEX 2).
4.

Also the President of the EPO decided to propose a new career system for the employees
of this Office to the Administrative Council in which promotion is based on merit and
performance. Instead of calling a HIGH-LEVEL NEGOTIATING BODY as an
independent authority dedicated to develop an appropriate career system, the President
assigned that duty to an internal working team led by two Principal Directors and a
Director of Directorate General 1 (DG1), which developed a new career system
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supposed to be in line with the document CA/39/14 presented to the Council earlier in
2014. Unfortunately, the new career system finally presented to the Budgetary and
Finance Committee and to the Administrative Council as document CA/84/14 is replete of
5.

legal flaws, which are discussed in detail below and in summary

does not respect the acquired rights and legitimate expectations of current staff
leads to unwarranted financial advantages to some members of the administration
fails to respect the fundamental principles of equivalence and proportionality
creates severe discrimination against a specific category of staff and pensioners
breaches the principle of prohibition to retroactivity
comprises a number of arbitrary provisions and
relates to a decision that has been adopted without an earlier, lawful statutory
consultation.
Although in its summary, document CA/84/14 on which decision CA/D 10/14 is based states that the proposed new career system has been redesigned with a stronger
emphasis on performance, the key underlying reason of the proposed system is evidently
the average reduction of near- and mid-term salaries of staff as explained in 41 of
document CA/84/14, [T]the alternative would be to maintain the existing career
structure... This is not recommended with view to the ... lack of financial sustainability of
the current system for the future. Based on that recommendation, in its 142 nd meeting,
the Administrative Council adopted the proposed new career system with its presently
impugned decision CA/D 10/14. In the same meeting, the Administrative Council made
a further decision, namely CA/D 11/14 (which has been challenged separately before this
Tribunal), which attempts to legitimise a financial undertaking by the EPO, which
currently creates a financial hole to the authorisation budget of the order of 30 Mill EURO
annually and which is estimated to rise over 100 Mill EURO annually as from 2023, when
the number of pensioners is expected to have increased from a current level of the order
of 1500 to more than 4500 persons. The two decisions CA/D 10/14 and CA/D 11/14 are
therefore chronologically and causally interlinked. Decision CA/D 11/14 attempts to
permanently legitimise that part of the massively challenged Pensions Reform introduced
in the years 2007 and 2008 under the initiative of the Delegations of Germany, Denmark,
Switzerland and Greece (cf. document CA/161/06) through which, the Contracting
States of the EPO ceased to respect their collectively guaranteed obligations
undertaken in 1977 (which they very well respect in the case of all other International
Organisations to which they participate and have an analogous pensions system to that of
6

the EPO), viz. the national coverage of

the 50% pensions adjustment adopted in

document CA/D 10/77 according to established international standards. That

financial burden (from the abolishment of which, mainly the host countries Germany and
The Kingdom of Netherlands profit) has been asked to be born by the EPO, but finally,
through the combination of decisions CA/D 10/14 and CA/D 11/14 and through the
recent increases of pension contributions by more than 20% has been imposed to
6.

EPO staff.
My request for management review against the upholding of the Councils decision CA/D
10/14 was filed directly with the Administrative Council, because that decision directly
affects adversely all staff members without having to implement that decision individually
at personal level. This is so, because each employee lost his/her former status as A-, B-,
C-category employee as from 1.1.2015 without involvement of an additional
administrative decision. The filed request should have therefore been deemed admissible
recalling inter alia the Defendants own reasoning put forward in document CA/56/14,
under point 15 and the principles laid down in the ILO Administrative Tribunals
Judgment No. 3291 (consideration 8).

II. ABOLISHMENT OF ACQUIRED RIGHTS

7.

The HIGH-LEVEL NEGOTIATING BODY of the European Union concluded that it is

vital to introduce guarantees on salary increases for each official up to the level of the
final step of his or her grade in the current structure; cf. point 3 supra. The need to
protect the security of the calculable and foreseeable income at the moment that the
Service Regulations are amended so as to avoid financial hardship is a fundamental and
essential term of employment and hence an acquired right. An employee might not be
capable to predict how to fare with his career development in the future (cf. ILOAT J. No.
3256, considerations 12, 14) when a change of the Service Regulations takes place, but he
is entitled to count with the foreseeable income, which is anticipated through the
succession of the pre-determined seniority step advancements provided for in the
Service Regulations concerning the category and grade assigned to him/her before
any change of rules has taken place. That calculable and foreseeable income serves as
basis when an international civil servant performs a long term investment such as taking a
loan for the purchase of a house (emphasis added). The Administrative Tribunal of the
7

ILO has obviously recognised the importance of that fundamental requirement and
pointed it out in J. No. 2972 (considerations 6,8,9,10), i.e. that the EPO as International
Organisation has a duty of care to ensure that any new arrangements do not cause
financial hardship to staff who entered into financial obligations. In J. No. 2941
(consideration 6), the Tribunal assessed specific elements of the career reform carried
out at Eurocontrol and found that the specific provision at issue was carried out
correctly in respect of each of the complainants, who retain not only their right to
continue to receive their previous salary but also their right to an automatic increase in
this salary by advancing to the next step on the basis of acquired seniority.

8.

The new career system of the EPO proposed in document CA/84/14 and adopted by
the Councils decision CA/D 10/14 is in breach with the fundamental principles of
international administrative law discussed above and should therefore be deemed
unlawful and decision CA/D 10/14 rescinded. The reform relating to the new career
system of the EPO not only deprives staff from reaching the scheduled seniority
advancement up to the level of the final step of his or her grade in the current
structure, but even freezes the advancement right to the next seniority step for staff
members who had at least partly - completed the requisite waiting period of 12,
respectively 24 months in their current 1-, or respectively 2-year step entitling them to
advancement to the next higher step by the 31st of December 2014 (emphasis added).
Thus, EPO staff finding themselves in that situation, had already fulfilled at least in part
- the conditions for advancement into the next higher seniority step already under the old
system, i.e. at the end of their last working day of December, but the new relegations do
not foresee - even in proportion - an automatic salary adjustment due to seniority at any
time after 1.1.2015 at which such adjustment was or would be due. The level of
unlawfulness of decision CA/D 10/14 is further manifested through the eternal freezing
of the salary of staff members at former grade A4(2) by converting their last salary into an
ad personam invariant remuneration; these officials are merely entitled to occasional
adjustments due to inflation according to the temporary salary method, cf. Article 56 of
the impugned decision CA/D 10/14. In the case of Eurocotrol, the Administrative
Tribunal of the ILO confirmed the lawfulness of a new career reform under the proviso of
8

the fulfilment of certain criteria. Thus, in J. No. 3275 (consideration 8) the Tribunal points
out: The reform has not had the effect of unreasonably restricting the promotion
possibilities of the officials, nor was it intended to do so. In the case of the EPO, the
intention has however been both to prevent the seniority adjustment to the salary of
former grade A4(2) officials and unreasonably restrict their promotion possibilities. Prior
to decision CA/D 10/14, grade A4(2) officials were entitled to automatic advancement
to the next higher seniority step every one to two years; grade A4 officials were on the
average entitled to promotion to grade A4(2) up to the capping of a budgetary limitation
allowing staff at grade A4(2) not exceeding 20% of the number of staff at grade A4 (cf.
ANNEX 3). This is a severe constraint of the system compared to the promotion rates
allowed in the European Union (cf. table of ANNEX 2), but at least had allowed on the
average 50 to 70 promotions to grade A4(2) annually at the EPO, which is an
Organisation embracing about 6800 permanent employees. Instead, the new career
system of the EPO solely foresees to a (limited) number of colleagues (cf. CA/84/14,
point 17) some technical or managerial career path higher than the level of grade A4.
Hence, the new career system of the EPO unreasonably restricts the promotion
prospects of former grade A4 officials and unreasonably abolishes altogether the
prospects of seniority advancement to former grade A4(2) officials.
9.

Moreover, according to the HIGH-LEVEL NEGOTIATING BODY of the European

Union the new system must guarantee the same overall income, throughout their career,
to officials who perform well (cf. point 3 above). This vital condition, perceived also
as an acquired right, is clearly not fulfilled in the case of officials for whom there is no
adequate guarantee for attaining the level of the final step of his or her grade in the
(former) structure within the originally foreseen time span. That acquired right is
definitely violated in the case of former grade A4(2) officials, whose salary has been
frozen.

10. The situation regarding the breach of an acquired right is further aggravated for that
category of undersigned requesters/complainants who have transferred national
pension rights to the Pensions Scheme of the EPO. This is so, because upon such
transfer (which constitutes a final and irrevocable decision) some of the earlier recognised
years have been discounted for actuarial reasons. Thus, for a period of say five years of
9

work outside the EPO, an official might have been able to achieve only a two- to threeyear recognition of accrued pension rights at an annual rate of 2% according to the
provisions of Article 10 PENSION REGULATIONS of the EPO. Such a strong discount
results from actuarial considerations anticipating that a new EPO employee would (at
least) reach the highest seniority step in his grade prior to retirement, which is associated
with a predictably higher end salary (apart from salary adjustments due to inflation) than
the officials salary when the national pension rights got transferred. The new career
system abolishes that guarantee of seniority advancement and hence reduces the real
value of the pension rights transferred from a national pensions system to the
pensions system of the EPO.
11. According to ILOAT J. No. 3256 (consideration 14), rules on promotion do confer an
acquired right insofar as they offer staff an expectation of advancement. Article 3 of
the Service Regulations still valid in 2014 grouped category A examiners, lawyers and
administrators in a bracket system comprising grades A1, A2, A3, A4 and A4(2). The
administrative reorganisation of the career system into a single spine career system
according to the impugned decision CA/D 10/14 foresees solely the formal transposition
of former grade A1- to A4-staff into new grades G7 to G13. The highest step of former
grade A4 is transposed to the highest step of new grade G13. No formal possibilities for
further advancement through normal promotion exist, which constitutes a clear breach of
the acquired right of former grade A4 staff members, in particular of those former A4
officials, who fulfilled the formal criteria for consideration of promotion to grade A4(2) at
the end of 2014 (emphasis added). Regarding the situation at Eurocontrol, the Tribunal
set forth in J. No. 3275 (consideration 8) that [I]inasmuch as under the old system there
was an objective prospect of promotion to a higher grade, their assignment to a generic
post in another classification system has not deprived them of that prospect of
advancement. The Tribunal went on with the following explanations: officials who
have reached the highest grade in their career bracket can progress further in their
career only by being appointed following a competition, in accordance with the terms and
conditions set forth in Article 16a of Rule of Application No. 2 of the Staff Regulations, to
another post in a new bracket, or through a job review justifying the reclassification of
their post in a higher bracket. The new rules on job classification have not therefore
10

deprived the complainants of the prospect of career advancement within Eurocontrol.

They can still be promoted in either of the circumstances outlined above.
12. Following the above considerations, it should be examined whether for former grade A4
and grade A4(2) officials, fair and proportionate advancement opportunities are
available under the new career system being it either through competition or
reclassification of posts. For examiners and lawyers of former grades A4 and A4(2)
reclassification of posts is not foreseen and is also unrealistic. The question to be
answered is therefore, whether a proportionate number of vacancies for advancement via
competition are foreseen by the reform pursuant to decision CA/D 10/14. The answer
to this question is to the negative. As shown in ANNEX 3, the former vacancies for
promotion to grade A4(2) were limited by budgetary reasons to 20% of the grade A4
posts. Hence, at the steady state, and once older grade A4(2) employees had retired, a
reasonable number of vacant posts existed for promotion of the best performing grade
A4 officials to the next higher grade A4(2) comprised in their career bracket. The
impugned decision CA/D 10/14 (cf. point 17 of the corresponding proposal C/84/14)
vaguely foresees only to provide perspectives to a (limited) number of colleagues
through enhancement of the technical career; the term limited is neither clarified nor
quantified. Decision CA/D 10/14 has therefore abolished an entire grade of the career
bracket embracing the examiners and lawyers of the EPO and replaced it by a vague
statement supposing to give a limited number of opportunities to a higher technical
career title open equally to the combined group of former grade A4(2) staff members
and former grade A4 staff members capable to reach the highest step in new grade G13.
This reform sounds like (and is actually so) an administrative act aiming at
unreasonably restricting the promotion possibilities of the officials (cf. point 8 above
quoting J. No. 3275). Consequently, this reform is in breach of fundamental and
essential terms of employment within the meaning of J. No. 832 and has violated the
acquired rights of the undersigned individual EPO officials.
13. Decision CA/D 10/14 is also in breach with the acquired rights or at least with the
legitimate expectations of officials at grades below former grade A4. Prior to entry into
force of the currently impugned decision, Article 49 Service Regulations allowed for the
vertical promotion to the next higher grade of those staff members, who, as per
11

31.12.2014 fulfilled the merits and seniority criteria for such promotion. That could for
instance concern staff members expecting a promotion from former grade B2 to
grade B3 or from grade A3 to grade A4 and subsequently be entitled to the automatic
seniority adjustment steps of the next higher grade, who should be promoted on the basis
of the services delivered and performance shown by 31.12.2014. The promotion
conditions associated with the new grade into which they are transposed according to
decision CA/D 10/14 annihilates such accumulated rights since under paragraph (2) of
Article 27 of the impugned decision CA/D 10/14, vertical promotion to the next higher
grade may only occur after having reached the last step of the grade into which the official
at issue was transposed as per 1.1.2015. This results to an arbitrary delay of promotion
to the next higher grade and violates the acquired rights of the individual officials
concerned. This is not a trivial matter. For the entitlement to promotion from grade A3 to
grade A4, an examiner or (respectively a lawyer or administrator) had to exhibit a very
high level proficiency and performance over many years for achieving those marks in
his/her staff report that would entitle him/her to such promotion. Moreover, in cases of
conflict still pending before the Internal Appeals Committee or before the Administrative
Tribunal of the ILO, a correction of staff report marks that might be deemed necessary
could have such implications that retroactive promotion should become necessary. Such
potential legal rights are also annihilated by decision CA/D 10/14, since the competent
promotion boards entrusted with the recommendation of promotions is such
circumstances and entitled to review the need for a retroactive promotion, say from grade
A3 to grade A4 before 31.12.2014, have ceased to exist.
14. A further loss of an acquired right is the entitlement to assignment to that step in the next
higher grade following promotion, which would be associated with a higher salary than
prior to promotion. This entitlement has been abolished by the provisions defined in the
last sentence of paragraph (5) of Article 27 of decision CA/D 10/14.

III.

BREACH OF THE PRINCIPLES OF EQUIVALENCE AND GOOD FAITH

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15. The principle of equivalence underpinning an administrative reform is that in practice

staff will be assigned to a new generic post with its associated grade-bracket
corresponding to the former career bracket (J. No. 3275, consideration 7).
16. The principle of good faith is seen in the present context in that the senior officials
responsible for the design of the new career system should have made all efforts to
ensure the respect of the principle of equality. When an administrative reform relating to
the adoption of a new career system takes place, it is the obligation of the Appointing
Authority to ensure on one hand that legitimate individual guarantees are secured (cf.
point 3 above) and on the other hand that no group of officials comes to the enjoyment of
unwarranted financial advantages. Both of these goals have failed. The underlying
philosophy of the above considerations finds support in ILOAT J. No. 3189 (consideration
10) pointing out that the principle of equality would be violated by this immediate
award of an advantage to a group of officials who would not yet be in a situation
comparable to that of the officials for whom the corrective mechanism of paragraph 3 of
Appendix II was introduced.
17. In relation to the above, the Administrative Councils attention was drawn to a
comparison of the following effects following from the transitional provisions pursuant
-

Articles 54, 55 and 56 of the its decision CA/D 10/14:

Former category A4(2) staff are not transposed to a corresponding bracket in the new

system (Article 56 (1))

In most occasions, staff are transposed to that step in the new corresponding grade
associated with a lower basic salary than the one to which they were assigned until

31.12.2014; this is tantamount to a material salary delay in future (Article 55 (3))

Comparing the salary tables (say in the case of Germany) adopted by the Councils
decision CA/D 8/14, it is seen that for the broadest Job Group 4 at the EPO, the lowest
entry salary is the same as in the old corresponding career bracket, but for the
employees in the Job Groups 3 and 2, the lowest entry salary levels are considerably
higher than in their old corresponding career brackets; since transposition takes
place on the basis of the salary scales defined in CA/D 8/14 and no employee (with the
exception of A4(2) employees) can be assigned to a grade and step below the lowest
grade and step of the corresponding job group, huge unwarranted financial benefits
13

arise artificially for younger management employees, who are also permanent EPO
officials, and who are transposed to Job Groups 3 and 2 as illustrated in the next
paragraph 18 (this is the effect of Article 54 (3); Article 55 (2) of the currently impugned
decision).

18. Document CA/39/13 (cf. ANNEX 4 reproducing the relevant part of document
CA/39/13) introduces a number of requests for review, which had been filed in 2013 by
several staff members and by elected staff representatives for different grounds but
without success. One of those requests tackled the problems relating to lack of clarity in
the wording of decision CA/D 34/07, which had amended the provisions of Article 49
Service Regulations relating to promotions and appointments. Those requests for review
had been filed in connection with appointments in the General Directorate 4 (Personnel
Department), which had concomitantly been accompanied by promotions falling within
the competence of the same Appointing Authority such that a vertical leap of more than
one category A grade had occurred (e.g. an employees internal appointment from a grade
A3 post to a grade A6 post). Citing ILOAT J. No. 3191, the requesters/complainants asked
the Administrative Council to perform the necessary clarifications in the Service
Regulations so as to respect the Case Law of ILOAT and prohibit that kind of
appointments associated with promotions beyond the next higher grade within the same
category. The two specific examples mentioned in that complaint were
- that of the Principal Director Human Resources (PD43) appointed/promoted from grade
-

A3 to grade A6 and
that of the Director, who had applied for the post HR Customer Interface, and who was
appointed/promoted from grade A3 to grade A5.

The examples of the above mentioned employees are highly relevant to the present
request for review, because the first employee was of grade A6 step 2 and the second
employee of grade A5 Step 3 on 31.12.2014; with reference to Article 40 of decision CA/D
10/14, it is clear that the said first employee (PD43) is transposed to Job Group 2, while
the said second employee to Job Group 3. By referring to the salary tables published in
CA/D 8/14, it is recognised that
- for the first employee (PD43), the basic salary amounted to 11,235.60 EUR in
December 2014 and 13,042.55 EUR in July 2015; and
14

for the second employee, the basic salary amounted to 10,283.50 EUR in December
2014 and 10,759.64 EUR in July 2015.

19. The preceding summary of facts and considerations show that the provisions of the
impugned decision CA/D 10/14 are in breach with the principles of equivalence and of
equality. They entail financial benefits to a limited number of young employees in the
medium and senior administration linked with quantum salary jumps from December
2014 to January 2015, which are neither linked with promotion nor with reclassification
of posts. Since the underlying decisions leading to such financial irregularities fall
within the competence of the Budget and Finance Committee (BFC) and of the
Administrative Council (AC), these are the only Bodies that can provide the
necessary remedies.
It is worrisome that one of the above mentioned employees was strongly involved in the
design of the new career system and that the finally proposed scheme in document
CA/84/14 had undergone the control of the harmonisation committees at principal
directorate or Office-wide levels (cf. CA/84/14, point 26).
20.

Since unwarranted financial benefits of the above kind have not been prevented by the
senior administration in the near past, who can guarantee in the future that bonuses
foreseen to be granted (and approved) exclusively by the appointing authority (Article 26
CA/D 10/14) remote from the control of the Administrative Council, may not be
tainted with favouritism and personal advantage in the future (emphasis added)?

21. Analogous questions are raised as to the intent of Article 25 of decision CA/D 10/14
allowing for annual two-step advancement. Where such two-step advancement is
supposed to reward high performing officials for whom a vertical promotion to the next
higher grade is no longer possible (cf. point 13 above), such a measure provides a
reasonable relief. Yet, this situation arises only for officials whose former grade
belonged to a multi-grade bracket and those were officials assigned to former grades C1
to C5, B1 to B5 and A1 to A4 (new Job Groups 6 to 4). The career brackets of officials
assigned to former grades A5 and A6 comprised a single grade in the old system and so
was the situation for grade A4(2) officials until October 2007, i.e. prior to adoption of the
contested decision CA/D 34/07. The provision allowing for annual two-step
advancement in the cases of Job Groups 3 and 2 corresponding to management posts
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and members of the Boards of Appeal is a rather dubious. This is so because respective
unreasonably quick 2-step seniority advancements in those cases would involve the
personal recommendation/decision of either Vice-Presidents and the President, who
according to ILOAT Case Law have been appointed according to political criteria to
those posts, or of the Chairs of the Boards of Appeal, which would be an act raising issues
regarding the independence of the Members of the Boards of Appeal. Furthermore,
from the legal point of view, an accelerated 2-step seniority advancement of employees
who had been assigned to a single-grade bracket (e.g. A5 or A6) prior to decision CA/D
10/14 would be tantamount to accelerated higher deferred pension rights for those
employees, who have not yet paid for a reasonable length of time analogous contributions
to the Reserve Fund for Pensions and Social Security (RFPSS). This in turn would imply
undue financial burden to RFPSS at the cost of lower ranked EPO officials (cf. also
related arguments in ILOAT J. No. 2875), which cannot be deemed lawful (emphasis
added).
22. The transposition foreseen by decision CA/D 10/14 breaches in a very severe form the
principle of equivalence from the point view that staff, who, prior to the reform
belonged to the same hierarchical rank and their basic salaries differed only due to age
seniority, have now been separated by vertical barriers as a consequence of decision
CA/D 10/14 as per 1.1.2015; this cannot be deemed lawful. Directors and Members of the
Boards of Appeal who had been assigned by promotion/selection through competition to
the same single-grade bracket associated with former grade A5 have been transposed
into three new hierarchically different single spine grades G13, G14 and G15. Thus, a
younger former grade A5 director shall have to undergo two promotion procedures in
order to be able to reach the same hierarchical level as an older, former grade A5 director
transposed to new grade G15. This is nothing but age-discrimination deemed unlawful
according to fundament principles of law strictly respected in countries of the European
Union (emphasis added).
IV. BREACH OF THE PRINCIPLE OF PROPORTIONALITY

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23. As outlined under point 5 above, the true underlying reasons of the reform are reasons of
political economics. At the imitative of some Member States, earlier given guarantees had
been ignored and by the Councils decision CA/D 25/07 a huge financial burden was
transferred overnight to the EPO, which, until that decision, was a financially well-balanced
International Organisation. This has indubitably been acknowledged by the financial
experts of Deloitte as revealed by the following quotation from the minutes of the 127 th
Administrative Council, document (cf. document CA/18/11):
91. The staff representatives said the study had confirmed that the Office's negative equity
was due mainly to shifting the cost of the tax adjustment from the member states to the
Office. They asked the Deloitte representatives what the figure would be if that had not
been done.
92. The Deloitte representatives replied that in that case the Office would indeed have no
negative equity.
24. The EPOs situation being as outlined above, EPO staff has been asked to make sacrifices in
order to improve the EPO equity. The lawfulness of that decision is not subject-matter of
the present request/complaint. However, if EPO staff is asked to make sacrifices, the
principle of proportionality demands that the sacrifices are share by all ranks of EPO
officials as this has been the case in those European countries in which the 2008 financial
crisis forced salary cuts/limitations to civil servants (emphasis added). The impugned
decision CA/D 10/14 pursues a different goal: The maximum attainable salary by highest
performing examiners, lawyers and administrators has been cut by 20% (this is readily
recognised by comparison of the salary tables valid before and after 1.1.2015; cf. CA/D
8/14); on the other hand, the maximum salary attainable by permanent members of the
management and by vice-president has remained unchanged. In addition to that, three
years ago (cf. CA/D 9/11), the Administrative Council had granted an extra 10% benefit to
vice-presidents on top of their normal salary, which decision CA/D 10/14 has not touched.
That kind of amendments may not be deemed proportionate. On top of that, we have
encountered the financial irregularities pointed out under point 18 above.
25. It is further noted, that in questions regarding salary methods, the Tribunal has ruled that
the underlying rules of adjustments in a new salary method should be stable, foreseeable
and clearly understood (J. No. 1821, consideration 7). It would be expected that rules
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relating to the methods of promotions having implications upon salaries meet analogous
standards. Until October 2007, the EPO rules of promotions enshrined in Article 49 Service
Regulations were indeed stable, foreseeable and clearly understood. In October 2007, the
Councils contested decision CA/D 34/07 blurred transparency, which had as a consequence
a number of controversial decisions relating to promotions through appointments. The
impugned decision CA/D 10/14 aggravates the situation further as it leaves a series of
critical questions unanswered, viz. it abolishes an entire grade, i.e. grade A4(2), without
equivalent, speaks of

new technical posts equivalent to director posts without any

indication as to the number of new posts to be created in the various sites of employment,
introduces vague provisions linked to undetermined terminology such as within the
budgetary limits ... or the appointing authority may lay down further terms ... and allows
downgrading of posts through reclassification (Articles 4, 25, 56 of CA/D 10/14).

IV. VIOLATION THE PROHIBITION TO RETROACTIVITY

26. Article 4 of the impugned decision CA/D 10/14 grants a blank check to the President of
the EPO to downgrade EPO officials by collectively downgrading the class of the posts
which they are assigned to. The most obvious target is former category A4(2) staff, who,
according to Article 56 of decision CA/D 10/14 have not been duly transposed to a
corresponding group and grade in the new single-spine system, although the Councils
decision CA/D 8/02 specifies the rank of grade A4(2) employees as being directly above
the rank of grade A4. Decision CA/D 8/02, further defining the conditions for the
promotion of EPO officials to grade A4(2), was valid until 31.12.2014 and had obviously
not been superseded by any more recent decision, since the section of the Service
Regulations specifying the promotion requirements to grade A4(2) has continuously
made reference to the Councils decision CA/D 8/02, since 2002. Both the downgrading
of grade A4(2) staff and the provisions laid down in Article 4 of the impugned decision
CA/D 10/14 are in eminent breach the principle of non-retroactivity.

V.

FLAWED CONSULTATION

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27. The impugned decision CA/D 10/14 was made on the basis of the Presidents proposal laid
down in document CA/84/14. That document differed in respect of essential issues (e.g. in
respect of the provisions foreseen in Articles 56 and 60 affecting a whole class of employees
and pensioners) considerably from its precursor version (i.e. GCC/DOC 6/14) discussed on
10 October 2014 in the General Consultative Committee (GCC) on 10 October 2014 as
required by Article 38 Service Regulations.
28. Moreover, the constitution of the GCC, which is the successor body of the General Advisory
Committee (GAC) since the decision CA/D 2/14 has taken effect, may not be deemed
lawful for the same reasons that the Internal Appeals Committee has unanimously concluded
that the constitution of the GAC including Vice-Presidents as members of that Committee
was unlawful (cf. extract of that opinion in ANNEX 5). Furthermore, by the Presidents
decision based on the content of a legally challenged circular, the GCC convened on
10.10.2014 did not embrace all elected staff committee members, who, according to the
election result of 18.6.2014 should be full members of the Central Staff Committee and
hence members of the GCC (cf. Articles 35(1),(3), 36(1) and 38(1) Service Regulations).
29. For the reasons given above, the GCC statutory consultation has not taken place as it
should for the discussion of the merits of the proposed reform as per document CA/84/14,
which, as analysed in the preceding paragraphs, does not comply with fundamental
principles of international administrative law.

C. Procedural irregularities
(i) The analysis provided in the above INSERT and the material
issues addressed under A (ii) above, unambiguously show that the
Complainants Request for Review filed with the Administrative
Council within the statutorily prescribed time limit was justified.
The challenged decision CA/D 10/14 had as direct adverse effect
the termination of counting seniority month after month for the
purpose of automatic seniority advancement to the next higher
horizontal step associated with higher remuneration as from
1.1.2015. Despite that fact having been made clear to the Council
by means of the submissions recited above in the INSERT, the
Council followed the recommendation of the President made in
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document CA/48/15 to reject the filed Request for Review as

irreceivable (cf. also justification in ANNEX 7) in a very
superficial manner. The superficiality of the Councils decision is
best realized by noting that the complete set of documents filed
with the Complainants Request for Review including five annexes
(present ANNEXES 1 to 5) had not been submitted to the Council
for decision. The Administrative Council had therefore been
confronted in its 144th meeting in June 2015 exclusively with the
text of a number requests for review annexed to document
CA/48/15 in incomplete and deficient form. Hence, the
Administrative Councils decision announced in present ANNEX 7
took place without consideration of all relevant material facts. The
taking of a harmful decision without even having received all
relevant document, obviously constitutes a serious procedural
violation under established international administrative law.
(ii) The termination of counting seniority experience month after
month as from 1.1.2015, in combination with the provisions of
CA/D 10/14 discussed under point 17 of part B, induces the net
effect of transposition to an effectively lower step in the new Ggrade system (associated with a lower net salary) than that of the
employees former grade in the old career system, which was
frozen as from 1.1.2015. This sort of financial harm is the
direct effect of decision CA/D 10/14 materialised as from the
beginning of 2015 without the taking of any supplementary
individual decision. The Complainants Request for Review filed
with the Administrative Council was therefore duly justified ratio
materiae. That being so, the Administrative Council has had the
obligation (duty of care) to examine all other grounds that had
been raised in the filed request, which pointed out grave
unbalances between the treatments of various groups of
employees (the most obvious but not only - being the situation
of A4(2) staff members) and allegations regarding potentially
favorite treatment of certain groups of influential management
officials (cf. points 18-20 supra).
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(iii) Moreover, the Presidents proposal submitted to the Council

as basis for decision CA/D 10/14 had been made after irregular
consultation of the General Consultative Committee (GCC) having
a composition of contentious legitimacy as explained in part B
above. Since decision CA/D 10/14 severely affects staff issues of
all EPO employees, proper consultation before the GCC (former
GAC General Advisory Committee -) should be considered as a
mandatory requirement for a correct overall procedure according
to established Case Law of the Administrative Tribunal of the ILO.

D. Conclusive remarks and the relief sought

The abolishment of the automatic calculation of seniority on
monthly basis for the purpose of advancement to the next higher
horizontal step in the category and grade assigned to the present
Complaint with effect as from 1.1.2015 is a legitimate cause of
action for challenging the Councils decision CA/D 10/14 and the
subsequent individual decision recited in ANNEX 7.
The direct and individual harm caused to the present Complainant
through decision CA/D 10/14 as from 1.1.2015 may only be
waived through the successful challenging of the general measure
responsible for that personal harm, vis. decision CA/D 10/14.
Hence, the relief sought in the present complaint is the full
recognition of the Complainants acquired right to be entitled
to the next (and subsequent) automatic horizontal step(s)
in the category and grade assigned to as per December 2014 as
soon as the appropriate seniority prerequisites have been fulfilled.
The loss of that right as from 1.1.2015 is a major financial harm
caused by decision CA/D 10/14 in direct and personal manner.
Abiding by the principles underscored in ILOAT J. No. 3291
(Consideration 8), the relief sought may only be achieved by
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setting aside the relevant provisions of decision CA/D 10/14.

Hence, the present Complainant, respectfully asks the
Administrative Tribunal to quash decision CA/D 10/14 ab initio
and ensure the reestablishment of all lost rights of the
Complainant, and also set aside the personal (and impugned)
decision recited in Annex 7. The Complainant requests 25000
EUR as compensation for moral damages for the stress and
insecurity caused by the adoption of decision CA/D 10/14 and the
payment of 2000 EUR in costs.
The Complainant, in Munich the 3rd of September 2015

Angel Rumbo AR22029

EUROPEAN PATENT OFFICE ROOM 5806
BAYERSTRASSE 115 (80335 MUNICH) GERMANY

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