Government plans to limit public employees' protection against dismissal

In March 2002, Austria's Vice Chancellor, Susanne Riess-Passer of the populist Freedom Party (FPÖ), announced her intention to reduce the current absolute protection against dismissal for civil servants to the minimum, despite fierce protests from the Civil Service Trade Union. While both parties in the coalition government, the FPÖ and the conservative People's Party (ÖVP), agree in principle on the necessity to reform the relevant public service regulations, they disagree sharply over which public employees should enjoy special protection against dismissal.

In March 2002, Susanne Riess-Passer, the Vice-Chancellor and chair of the populist Freedom Party (Freiheitliche Partei Österreichs, FPÖ), raised the contentious issue of what is known in Austria as 'Pragmatisierung'- ie system of permanent tenure for the career public servants, which provides absolute protection against dismissal (see below). In line with prevailing public opinion, the coalition government of the FPÖ and the conservative People's Party (Österreichische Volkspartei, ÖVP) intends to reform the relevant public service regulations to restrict this right of absolute protection against dismissal to a certain narrowly defined group of public employees.

A recent study, commissioned by the daily newspaper Der Standard and conducted by market-Institute, revealed that 65% of Austrians surveyed regard the 'Pragmatisierung' as obsolete and think that civil servants should be treated like employees in the private sector. Only 29% support the counter-argument that public service activities are distinct from the private sector and hence require a different employment relationship.

However, the president of Austria's Supreme Administrative Court (Verwaltungsgerichtshof, VwGH), Clemens Jabloner, recently defended the current absolute protection against dismissal for civil servants. He emphasised the importance of a specific dismissal protection for both civil servants who perform 'sovereign functions' (hoheitliche Funktionen) and public employees whose functions cannot – for reasons of particular importance for public life – be entrusted exclusively to individuals who are employed in an employment relationship governed by private law.

Employment relationships in the public service

In the Austrian public service, there are two types of employment relationship between public employees and their employer: that of the career public servant (Beamter), which is a public-law relationship; and that of the 'contract public employee' (Vertragsbediensteter), which is a private-law relationship.

Both career public servants and contract public employees of the federal government and the regional governments (Länder) have service regulations (Dienstrecht) which are laid down in detail by statute. According to prevailing legal opinion, the state is not obliged to assign 'sovereign functions' exclusively to career public servants and other functions exclusively to contract public employees, but has a right to choose. Nevertheless, sovereign functions are usually performed by career public servants, while their auxiliary staff are frequently contract public employees.

The difference between the two forms of employment in the public service lies mainly in the fact that a career public servant is appointed and, as a matter of principle, remains in the service of a public employer for life. This is the basis of the 'Pragmatisierung', which includes the abovementioned absolute protection against dismissal. When career public servants reach pensionable age, they do not leave the public service but are shifted into a 'retirement relationship' (Ruhestand). By contrast, contract public employees hired under a private-law contract of employment may be dismissed under certain circumstances, and after the employment relationship ends and pensionable age is reached they receive a pension under the statutory scheme provided for by the General Social Insurance Act (Allgemeines Sozialversicherungsgesetz, ASVG).

Reform proposal

Although both partners in the coalition government, the ÖVP and the FPÖ, criticise what they see as the 'anachronistic nature' of the 'Pragmatisierung', they disagree on which group of public employees should be exempted from its abolition. While Vice Chancellor Riess-Passer wants to provide absolute protection against dismissal only for employees performing judicial and police tasks, Chancellor Wolfgang Schüssel of the ÖVP also wants to retain the 'Pragmatisierung' for school teachers.

The reform proposal made by Ms Riess-Passer, who also holds the position of the Federal Minister for Public Services, includes details about the proposed new type of employment relationship for civil servants. The cornerstones of the proposal are as follows:

• employees newly entering the public service will become public employees with improved protection against dismissal. However, the absolute dismissal protection for these employees will be abolished, ie persons hired under the new type of employment relationship may be dismissed under certain – narrowly defined – circumstances;

• on reaching pensionable age, these employees will receive a pension under the statutory scheme provided for under the ASVG. In order to maintain the total amount of their lifetime income, actual earnings will have to be increased;

• newly hired public employees may be entitled to severance pay under the recently proposed new severance payment scheme (AT0112231F);

• contract public employees (see above) will be able to transfer into the new employment relationship. Therefore, their existing pension fund might be replaced by the new severance payment scheme; and

• an earnings limit for contributions to social insurance (Höchstbeitragsgrundlage), which is currently applicable only to employment relationships in the private sector could also be introduced for public employees.

Unions protest against reform

Despite fierce protests from the Civil Service Trade Union (Gewerkschaft Öffentlicher Dienst, GÖD) and criticism from the ÖVP, Ms Riess-Passer intends to enact her reform proposal within the current legislature, ie not later than summer 2003. Until then, she is pursueng a strategy of taking small steps. While at present, the conferring of 'Pragmatisierung' on civil servants above the age of 45 years requires the consent of the Federal Minister for Public Services, Ms Riess-Passer wishes to extend her decision-making power over this issue to civil servants from the age of 40. In effect, this means that she would refuse any further 'Pragmatisierung' of employees within this age group.

Unions are strongly opposed to the abolition of the 'Pragmatisierung' and Fritz Neugebauer, the chair of GÖD, claims that the proposed reform of the public employment relationship would involve exorbitantly high additional costs over the next 20 years.

Commentary

Since civil servants generally have greater protection against dismissal than private sector employees, the public may consider this an unfair privilege and thus demand that the 'Pragmatisierung' of public employees be abolished. The FPÖ seems to know well how to utilise prevailing public opinion in order to gain approval for its reform proposal. However, the FPÖ faces heavy opposition from the unions as well as from its coalition partner, the ÖVP, albeit for different reasons. While the conservative ÖVP wishes to protect its own supporters – notably teachers – from losing their right to absolute protection against dismissal, unions want to uphold prevailing conditions in order to prevent political interference. Since several attempts to reform the career public servant employment relationship have failed in the past, it does not seem sure that the reform plans will be realised in the near future. (Susanne Pernicka, University of Vienna)