Kuwait Court of Cassation principle number 406

Summary: - Depriving an employee of the end-of-service gratuity and payment in lieu of notice. Condition: Proof that he committed one of the acts exhaustively specified in paragraph (a) of Article 41 of Law 6/2010 concerning Employment in the Private Sector, including committing a fault resulting in substantial loss to the employer. - The employer: His obligation, before dismissing an employee for any of the cases stated in Article 41 of Law 6/2010 concerning Employment in the Private Sector, to conduct an administrative investigation with him, notify him therein in writing of what is alleged against him, hear his statements, investigate his defense in a record placed in his personal file, and notify him in writing of the sanction, its type and extent, and the reasons for imposing it. Breach thereof. Consequence: The dismissal decision lacks the constituent elements of its existence and becomes tantamount to nonexistence. Reason: It lacks essential safeguards required by law. Effect: The employee is not obliged to challenge it independently pursuant to paragraph (c) of Article 41 of Law 6/2010; it suffices for him to invoke its nonexistence when the employer relies upon it in any action. Reason: The purpose of that paragraph is for the employee to establish the absence of any of the cases mentioned in both paragraphs of Article 41 and the employer's arbitrariness in attributing any of them to him, provided that the latter followed the procedures preceding the issuance of the dismissal decision. Example. Rule: Article 41 of Law No. 6 of 2010 concerning Employment in the Private Sector provides: "Subject to the provisions of Article (37) of this Law, (a) the employer may dismiss the employee without notice, compensation, or gratuity if the employee commits one of the following acts: 1- If the employee commits a fault resulting in substantial loss to the employer. 2-..... 3- (b) The employer may dismiss the employee in one of the following cases: 1-...... 2-.... 3-...... 4- If he breaches or defaults on any of the obligations imposed upon him by the provisions of the contract and this Law. 5- If his repeated violation of the employer's instructions is established. In these cases, the dismissal decision shall not result in depriving the employee of the end-of-service gratuity. (c) An employee dismissed for one of the cases mentioned in this Article has the right to challenge the dismissal decision before the competent labor circuit in accordance with the procedures prescribed in this Law. If it is established by a final judgment that the employer acted arbitrarily in dismissing the employee, the latter shall be entitled to the end-of-service gratuity and compensation for the material and moral damage sustained." Article 37 of the same Law provides: "No sanction may be imposed upon an employee until he has been notified in writing of what is alleged against him, his statements have been heard, his defense investigated, and this has been recorded in a record placed in his personal file. The employee must be notified in writing of the sanctions imposed upon him, their type and extent, the reasons for imposing them, and the penalty to which he will be subject in the event of repetition." These provisions indicate that an employee may not be deprived of the end-of-service gratuity and payment in lieu of notice unless it is established that he committed one of the acts exhaustively specified in paragraph (a) of the aforementioned Article 41, including committing a fault resulting in substantial loss to the employer. If the latter, before dismissing the employee for any of those cases, fails to conduct an administrative investigation with him, notify him therein in writing of what is alleged against him, hear his statements, investigate his defense in a record placed in his personal file, and notify him in writing of the sanction, its type and extent, and the reasons for imposing it, the dismissal decision lacks the constituent elements of its existence and becomes tantamount to nonexistence, because it lacks essential safeguards required by law. Thereafter, the employee is under no obligation to challenge it independently pursuant to paragraph (c) of the aforementioned Article 41; it suffices for him to invoke its nonexistence when the employer relies upon it in any action. This is because the purpose of that paragraph is for the employee to establish the absence of any of the cases mentioned in both paragraphs of Article 41 and the employer's arbitrariness in attributing any of them to him, provided that the latter followed the procedures preceding the issuance of the dismissal decision as set out above.