Pretextual Threats of Collective Redundancies: A Form of Workplace Harassment (Mobbing) under Cyprus Law

Written by Giorgos Kazoleas, Managing Partner Lawyer at Legal Experts Cyprus

In the Cypriot labor market, personnel management is often characterized by employer practices that exploit the fear and insecurity of employees.

A particularly serious issue is the pretextual threat of collective redundancies within companies and enterprises. When such a threat does not reflect a genuine need for restructuring or financial distress, but is instead used deceptively as leverage to intensify labor and suppress claims (e.g., salary increases, bonus claims, other benefits, promotions, etc.), it transforms into a form of workplace harassment (mobbing) with specific legal implications.

The Specialized Legal Framework: Law 42(I)/2025

The legal handling of this phenomenon—which has reached concerning proportions in Cyprus—was decisively strengthened by the enactment of the Prevention and Combating of Violence and Harassment at the Workplace Law of 2025 (Law 42(I)/2025). This law incorporates the International Labour Organization (ILO) Convention 190.

For the first time, this Law provides a clear definition and a specialized framework for addressing all forms of violence and harassment, including psychological harassment (mobbing), regardless of whether it is linked to a protected characteristic (gender, race, etc.).

Definition of Harassment

According to the Law 42(I)/2025, harassment includes any act, behavior, practice, or action that is unwanted by the person subjected to it and has the purpose or effect of violating their dignity or creating a hostile, degrading, humiliating, or offensive environment.

The systematic and pretextual use of the threat of layoffs, aimed at manipulating employees to work more intensely or refrain from legal claims, fully meets the above definition, as it creates a hostile and humiliating environment of insecurity.

The Violence and Harassment Convention, 2019 (No. 190)

The ILO adopted Convention No. 190, which defines "violence and harassment" as a range of unacceptable behaviors and practices, or threats thereof, that aim at, result in, or are likely to result in psychological or economic harm.

Threats of collective redundancy, if used coercively or in bad faith to intimidate or cause psychological distress (i.e., outside the context of legitimate business communication), could potentially fall under this broad definition, particularly regarding psychological and economic harm.

The Pretextual Threat as "Mobbing"

A threat of collective redundancies, when pretextual and misleading, constitutes an abusive exercise of managerial prerogative aimed at the psychological exhaustion of employees.

Organizing "serious" and "critical" internal staff meetings where a director, owner, or CEO warns (essentially threatens) employees of impending layoffs and staff cuts—citing pretextual excuses such as a supposedly negative corporate trajectory, reduction of operating costs, boosting competitiveness, or the international economic crisis—constitutes clear intimidation of employees.

The Concept of Abusiveness

Collective redundancies are regulated by the Collective Redundancies Law of 2001 (28(I)/2001), which requires genuine grounds (economic, technological, or organizational) and a mandatory consultation process.

When a company:

• Does not face genuine financial distress.
• Uses the threat to blackmail employees into intensifying their work or waiving their rights (e.g., raises, benefits, bonuses).
• Intends to circumvent legal procedures and the higher compensations provided for collective redundancies by pushing employees toward "voluntary" resignation (known as Constructive Dismissal),

then this practice meets the criteria for harassing behavior. The objective is clearly intimidating and punitive, intended to exert psychological violence and deactivate any intention of the employee to claim rights or develop professional self-confidence.

The employer's intent in using this strategy is to keep employees in a constant state of anxiety over losing their jobs, forcing them to work harder and deterring them from seeking improvements in their individual terms of employment. The result is mental pressure, stress, and a workplace climate of terror, constituting a direct assault on the dignity and mental health of the staff, as defined by Law 42(I)/2025.

Employee Rights and Claims

An employee affected by such a pretextual threat now possesses stronger legal tools in Cypriot labor law:

Complaint to the Employer: Law 42(I)/2025 mandates that employers maintain internal procedures for handling complaints. An employee may submit a formal complaint regarding harassment.

Recourse to the Industrial Disputes Tribunal:

-Action for Harassment: Claiming compensation for workplace harassment, the violation of personality rights, and the breach of the provisions of Law 42(I)/2025.

-Action for Constructive Dismissal: If the employee resigns due to the unbearable, hostile environment created by the pretextual threat, they may be considered as having been unfairly dismissed (Constructive Dismissal) and claim redundancy compensation.

Protection from Retaliation: The Law provides explicit protection against retaliation or adverse treatment of an employee who has filed a harassment complaint.

Conclusion

The pretextual threat of collective redundancies is an unfair and unlawful employer tactic. The enactment of Law 42(I)/2025 in Cyprus now allows employees to confront such threats not only as unfair dismissal but as a distinct form of psychological harassment at work (mobbing).

The dignity and mental health of employees must be protected against any action, even those wearing the mask of a "management decision," if the true intent is intimidation and manipulation for corporate profit or the enhancement of executive bonuses.

Giorgos Kazoleas is a Lawyer qualified in Cyprus, Managing Partner at Legal Experts Cyprus, 75 Prodromou av., 2063, Nicosia, Cyprus, tel. +357 22507666, email: gkazoleas@legalexpertscy.com, website: www.legalexpertscy.com