Greece’s Supreme Court of Greece has issued a landmark ruling confirming that retirement alone cannot justify the dismissal or demotion of employees who continue working. The decision resolves long-standing disputes over the treatment of public sector workers who retire but remain in their positions.

The Supreme Court of Greece, B1 Labor Division ruled that retirement cannot trigger an automatic reduction in salary or reclassification to the lowest pay grade of the unified public sector wage scale. Such actions constitute a unilateral detrimental change in employment terms.

Background of the Case

The case involved employees of the Municipal Water and Sewerage Company of Greater Volos, who were previously dismissed after retiring. In 2024, the Volos Court of First Instance had already ruled that these dismissals were illegal, but the municipal company challenged the decision at the Supreme Court.

A 2024 law attempted to regulate pay treatment for public sector retirees who continue working, including retroactive payments. However, it excluded some employees in similar situations, creating uncertainty and potential financial penalties.

Supreme Court Findings

The court emphasized that any internal regulations or contracts allowing automatic dismissal upon retirement are obsolete under Greek law. Retirement alone cannot justify moving an employee to the lowest salary grade or reducing pay. Such demotions were ruled as unilateral, harmful changes to employment conditions, and employees retain the right to have their prior service recognized for future salary progression.

Legal representatives handling the case described the ruling as a decisive resolution of the legal issue at the highest judicial level. They noted that previous partial remedies by the government had left many public sector employees at risk of excessive financial penalties. The Supreme Court decision now provides clarity and safeguards for retirees continuing their professional roles.