Kuwait Court of Cassation principle number 431

Summary: - The settlement agreement between the appellant and the respondent bank for which she works. Dependent on the result it achieves and whether or not it affords her a greater benefit than the provisions of the Labour Law. Its diminution of those rights, including the prohibition on the employer charging interest on loans it granted her. Its effect. Invalidity of the agreement. Inapplicability of the provision of Article 13 of Law 51/2010 establishing a fund to address the circumstances of citizens in default on loan repayments, which required the waiver of any mutual judicial proceedings concerning the worker’s indebtedness under a loan obtained in her capacity as such from the employer. Rule: The provision in Article 115 of Law No. 6 of 2010 concerning Labour in the Private Sector that “(1)..... (2) Every condition or agreement concluded before or after this Law takes effect whereby the worker waives any right granted by law shall be void, as shall every settlement or release involving a diminution of, or discharge from, the worker’s rights arising under the employment contract during its term or within three months from the date of its termination, whenever contrary to the provisions of this Law” clearly indicates that the legislature did not recognize any agreement between an employer and a worker depriving the latter of any of his rights established by the provisions of the Labour Law, and deprived it of binding force between its parties because it contravenes these mandatory provisions relating to public order, by which it intended to achieve a general economic and social interest. It thus prohibited the parties to an employment contract from opposing this interest through agreements between them, unless they afford the worker a greater benefit than that prescribed for him by those provisions, so as to achieve a fair balance between the interests and protection of workers, on the one hand, and the interests of employers, on the other, because of the positive effects of this balance on national output generally. It extended the scope of application of this provision to agreements concluded before it took effect. Accordingly, the validity of the settlement agreement concluded between the appellant and the first respondent bank on 19/1/2011 depends on the result it achieves. If it affords the worker, “the appellant,” a greater benefit than that afforded her by the aforementioned provisions of the Labour Law, it is valid and binding on its parties. If it diminishes her rights established thereby, including the prohibition on the employer, “the first respondent,” charging interest on loans it granted her while she was working for it, the agreement is void, has no binding force between its parties, and is not subject to the provision of Article 13 of the aforementioned Law No. 51 of 2010, which requires its parties to waive any mutual judicial proceedings between them concerning the worker’s indebtedness under a loan obtained, in that capacity, from the employer.