Waiver of Employment Rights in Cypriot Law

The issue of whether an employee may waive employment rights has been examined extensively in Cypriot jurisprudence. While the general principle of freedom of contract under the Contracts Law, Cap. 149 allows parties to regulate their relations, including compromise and release, the validity of such a waiver depends on strict conditions.

Binding Effect of Release Agreements

The Supreme Court has recognised that a clear and unambiguous release document may constitute an estoppel by deed and bar subsequent claims. In Χατζηστυλλή ν. Κυπριακές Αερογραμμές Λτδ (2012) 1Β Α.Α.Δ. 989, the Court upheld a waiver signed by the employee, holding that the declaration must be treated as binding and incapable of contradiction by extraneous evidence. Similarly, in Διόνας Γεώργιος ν. Κυπριακές Αερογραμμές Δημόσια Εταιρεία Λτδ μέσω των Εκκαθαριστών Αυγουστίνου Παπαθωμά και David Dunckley και Άλλου (2016) 1 ΑΑΔ 1235, the Court emphasised that once an employee has expressly and unequivocally released the employer from further claims, he is precluded from pursuing them.

This principle reflects the English common law position in Gallie v. Lee [1971] A.C. 1004, where the House of Lords held that a signatory bears responsibility for understanding the document signed.

Requirement of Free Consent

However, the enforceability of a waiver depends upon the free consent of the employee. According to Cap. 149, article 14, consent is free when it is not obtained by coercion (article 15), undue influence (article 16), misrepresentation or fraud.

In ΖΑΧΑΡΙΑΔΗ ν. UNIVERSAL LIFE INSURANCE CO LTD κ.α., ΠΟΛΙΤΙΚΗ ΕΦΕΣΗ ΑΡ. 144/2013, 16/4/2019, the Court analysed allegations of duress and undue influence, stressing that where an employer exploits a position of dominance over an employee, the resulting agreement may be invalid. The doctrine of undue influence, as explained in Allcard v. Skinner (1887) 36 Ch.D. 145, prevents a party from retaining benefits gained through unfair exploitation of trust.

Thus, even if a release is formally valid, it may be struck down if it is the product of coercion, domination, or pressure.

Limits to Waiver of Rights

While waivers are generally permissible in Cyprus, they cannot extend to rights of a mandatory nature. For example, under the Termination of Employment Law of 1967 (Cap. 123), rights relating to statutory compensation cannot be contracted out. Likewise, anti-discrimination rights under the Equal Treatment in Employment and Work Law, N.58(I)/2004 and the Equal Treatment of Men and Women in Employment Law, N.205(I)/2002 derive from EU directives and are considered matters of public policy, rendering any contractual exclusion or waiver legally ineffective.

Conclusion

A waiver of employment rights is valid and enforceable under Cypriot law only if:

1. it is clear, unambiguous, and supported by consideration (e.g. settlement of disputed claims);

2. it is entered into with free and informed consent, without duress or undue influence (Cap.149, arts. 14–16); and

3. it does not purport to exclude rights of a mandatory or public order character, such as statutory compensation or non-discrimination protections.

The case law demonstrates that while Cypriot courts will respect freedom of contract, they will intervene to protect employees from unfair waivers that undermine fundamental labour protections.