RASK Successfully Represented TAS in an Employment Dispute

RASK attorney-at-law Keidi Kõiv successfully represented Tartumaa Arendusselts (TAS) in an employment dispute with a former employee who had extraordinarily terminated their employment contract. The employee filed a claim with the Labour Dispute Committee, seeking unpaid remuneration (including bonuses and overtime pay), compensation for non-material damage, and a finding that workplace bullying had occurred. TAS disputed these allegations and filed a counterclaim seeking a declaration that the extraordinary termination of the employment contract was unjustified and without legal grounds.

The Labour Dispute Committee ruled in favour of TAS, finding that there were no grounds for the extraordinary termination of the employment contract and no evidence of workplace bullying. As a result, the employee’s claims for remuneration and damages were also largely dismissed.

The dispute addressed several important principles of employment law:

• Compensation for overtime work: The Labour Dispute Committee emphasised that overtime should be compensated with time off as soon as reasonably possible, allowing employees sufficient rest while enabling employers to maintain an accurate overview of overtime worked. Employees cannot accumulate overtime over several months without informing their employer. Such conduct is neither reasonable nor consistent with the employer’s legitimate interests.

• Employer discretion in awarding bonuses: Where an employer has no organisation-wide bonus policy and bonus payments are subject to individual decisions by its governing body, awarding bonuses is a right rather than an obligation of the employer. The employer therefore retains discretion over whether, when, and under what conditions to award bonuses to individual employees. If the parties have agreed that performance-related bonuses are discretionary rather than mandatory, the employee has no contractual right to demand such payments.

• Distinguishing workplace bullying from ordinary workplace disagreements: Not every disagreement or interpersonal conflict between employees constitutes workplace bullying. Such situations may arise naturally in the course of working relationships. Similarly, an employer's decision to draw an employee's attention to mistakes in their work or provide guidance on improving work processes and performance does not, in itself, constitute workplace bullying.