Provisional text
OPINION OF ADVOCATE GENERAL
COLLINS
delivered on 13 June 2024 (1)
Joined Cases C‑146/23 and C‑374/23
XL
v
Sąd Rejonowy w Białymstoku
(Request for a preliminary ruling from the Sąd Rejonowy w Białymstoku (Poland))
and
SR,
RB
v
Lietuvos Respublika
(Request for a preliminary ruling from the Vilniaus apygardos administracinis teismas (Lithuania))
(Reference for a preliminary ruling – Rule of law – The second subparagraph of Article 19(1) TEU – Obligation on Member States to provide remedies sufficient to ensure effective legal protection in the fields covered by EU law – Principle of judicial independence – Judges’ remuneration)
Introduction
1. Throughout the existence of state systems grounded upon the separation of powers, judges’ remuneration has been a matter of necessary concern. As Alexander Hamilton presciently observed in The Federalist, ‘NEXT to permanency in office, nothing can contribute more to the independence of the judges than a fixed provision for their support. … In the general course of human nature, A POWER OVER A MAN’s SUBSISTENCE AMOUNTS TO A POWER OVER HIS WILL. And we can never hope to see realized in practice, the complete separation of the judicial from the legislative power, in any system which leaves the former dependent for pecuniary resources on the occasional grants of the latter.’ (2)
2. These requests for a preliminary ruling present the Court with an opportunity to revisit and to expand on its existing case-law on judges’ remuneration pursuant to the second subparagraph of Article 19(1) TEU (3) in the context of the principles of judicial independence and effective judicial protection. (4)
3. In its judgments of 27 February 2018, Associação Sindical dos Juízes Portugueses (5) and of 7 February 2019, Escribano Vindel, (6) the Court held that the receipt by members of the judiciary of remuneration commensurate with the importance of their functions constitutes a guarantee essential to judicial independence. In order to fulfil that requirement a court (7) must exercise its functions autonomously, without being subject to any hierarchical constraint or subordinated to any other body and without taking orders or instructions from any source whatsoever, thus being protected against external interventions or pressure liable to impair the independent judgment of its members and to influence their decisions. (8) The Court placed this requirement on an equivalent footing to the protection of members of the judiciary from removal from office, thereby making a direct link between judges’ security of tenure and their material security. (9)
4. Like other public office holders and servants, judges are not immune from reductions in their remuneration. (10) In the Portuguese judges and the Escribano Vindel judgments, the Court held that the principle of judicial independence in the second subparagraph of Article 19(1) TEU does not preclude Member States taking measures to reduce judges’ remuneration in certain circumstances. In order to eliminate what were regarded as excessive budget deficits, the Republic of Portugal and the Kingdom of Spain (11) reduced the salaries of all public office holders and employees in the public sector, including those working in the legislative, executive and judicial arms of the State. (12) Those measures did not target or single out members of the judiciary for special treatment. They were also of a temporary and a limited nature. (13)
5. The present requests for a preliminary ruling arise in the context of the application of generally applicable measures governing judges’ remuneration in Poland and Lithuania and do not concern a reduction in individual judges’ remuneration, such as following disciplinary proceedings. The measures also have a broader scope than those the Court considered in its Portuguese judges and Escribano Vindel judgments. The referring courts ask the Court to evaluate the role of the legislature and the executive in the process of determining judges’ remuneration and any possible reduction thereof. They also seek to ascertain if relevant criteria to guide that process can be derived from the second subparagraph of Article 19(1) TEU.
Legal Framework – National law
Polish law
6. Article 178 of the Konstytucja Rzeczypospolitej Polskiej (Constitution of the Republic of Poland) provides:
‘1. Judges, within the exercise of their office, shall be independent and subject only to the Constitution and statutes.
2. Judges shall be provided with appropriate conditions for work and granted remuneration consistent with the dignity of their office and the scope of their duties.
…’
7. Article 91 of the ustawa – Prawo o ustroju sądów powszechnych (Law on the organisation of the ordinary courts) of 27 July 2001 (14) states:
‘…
Paragraph 1c. The basis for setting the basic salary of judges for a particular year shall be the average salary during the second quarter of the previous year published in the ‘Monitor Polski’ Journal of Laws by the President of the Central Statistical Office […], subject to Paragraph 1d.
Paragraph 1d. If the average salary referred to in Paragraph 1c is lower than the average salary published for the second quarter of the preceding year, this shall be adopted as the basis for setting the basic salary of a judge at the previous rate.
Paragraph 2. The basic salary for a judge shall be expressed in grades, the level of which shall be determined through the application of multipliers to the basis for determining the basic salary referred to in Paragraph 1c. The basic salary grades for individual judicial posts and the multipliers used to determine the level of the basic salary for judges in individual grades are set out in the annex to this Law.
…
Paragraph 7. In addition, remuneration for judges shall be differentiated by a seniority allowance amounting, as from the sixth year of service, to 5% of the basic salary and increasing each year by 1% until it reaches 20% of the basic salary.’
8. On 17 December 2021, the Polish legislature adopted the ustawa o szczególnych rozwiązaniach służących realizacji ustawy budżetowej na rok 2022 (Law of 17 December 2021 on specific arrangements for implementing the budget law for 2022). (15) That law entered into force on 1 January 2022. According to Article 8 thereof:
‘1. For 2022, the basis for setting the basic salary of judges referred to in Article 91(1c) of the Law of 27 July 2001 on the organisation of the ordinary courts (Dz. U. of 2020, item 2072, and of 2021, items 1080 and 1236) shall be the average remuneration in the second quarter of 2020, published in the communication of the President of the Główny Urząd Statystyczny (Central Statistics Office, Poland).
2. The basis referred to in paragraph 1 shall be increased by PLN 26.
3. Where separate provisions refer to the basis for determining the basic salary of judges referred to in Article 91(1c) of the Law of 27 July 2001 on the organisation of the ordinary courts, this shall correspond, for 2022, to the average remuneration in the second quarter of 2020, published in the communication of the President of the Główny Urząd Statystyczny (Central Statistics Office), plus PLN 26.
4. Where separate provisions refer to the remuneration of judges, that remuneration shall, for 2022, correspond to the remuneration determined in accordance with paragraphs 1 and 2.’
9. On 1 December 2022, the Polish legislature adopted the ustawa o szczególnych rozwiązaniach służących realizacji ustawy budżetowej na rok 2023 (Law of 1 December 2022 on specific arrangements for implementing the budget law for 2023). (16) That law entered into force on 1 January 2023. According to Article 8 thereof:
‘1. For 2023, the basis for determining the basic salary of judges referred to in Article 91(1c) of the Ustawa z dnia 27 lipca 2001 r. – Prawo o ustroju sądów powszechnych (Law of 27 July 2001 on the organisation of the ordinary courts) (Dz. U. of 2020, item 2072, as amended) shall be PLN 5 444.42.
2. Where separate provisions refer to the basis for determining the basic salary of judges referred to in Article 91(1c) of the Ustawa z dnia 27 lipca 2001 r. – Prawo o ustroju sądów powszechnych (Law of 27 July 2001 on the organisation of the ordinary courts), for 2023, the amount thereof shall be PLN 5 444.42.’
Lithuanian law
10. Article 3 of the Lietuvos Respublikos teisėjų darbo apmokėjimo įstatymas (Law of the Republic of Lithuania on remuneration of judges; ‘the LRJ’), in the version in force from 1 January 2022 to 30 June 2023, (17) provides that the base rate for the salary (remuneration) of State politicians, judges, State officials, civil servants, and employees of institutions funded by the State and municipalities of the Republic of Lithuania for a given year adopted by the Lietuvos Respublikos Seimas (Parliament of the Republic of Lithuania) is applied for the calculation of judges’ remuneration. The base rate of the upcoming financial year is to be set by national collective agreement taking into account the average annual inflation rate for the previous year (as calculated by the national consumer price index), the level of the minimum monthly salary and the impact of other factors affecting the level and evolution of the average salary in the public sector. The Lietuvos Respublikos Seimas (Parliament of the Republic of Lithuania) approves the base rate agreed in the national collective agreement. If the national collective agreement is not concluded or is not modified by 1 June of the current year, the base rate of the upcoming financial year is adopted by the Seimas on a proposal from the Lietuvos Respublikos Vyriausybė (Government of the Republic of Lithuania), after having assessed and taking into account the circumstances provided for in this Article. The new base rate to be approved may not be lower than the existing base rate, unless exceptional circumstances are established and declared in accordance with the procedure provided for in the Lietuvos Respublikos fiskalinės sutarties įgyvendinimo konstitucinis įstatymas Nr XII-1289 (Constitutional Law of the Republic of Lithuania on the implementation of the fiscal treaty) of 6 November 2014 (TAR, 2014, No 17028).
11. Pursuant to Article 4(2) of the LRJ, judges’ (18) remuneration consisted (19) of: (i) a salary; (ii) an increment for length of service to the Lithuanian State; (iii) a payment for working and being on standby duty on rest days and on public holidays, and for substitution; and (iv) a bonus for an increase in the workload. In accordance with Chapter II of the Annex to the LRJ, judges’ (20) salary is calculated by multiplying the salary coefficient set out in the Annex to the LRJ by the base rate. The base rate was EUR 181 in 2022 and EUR 186 in 2023. The salary coefficient for a regional court judge was 17.2. (21)
12. Article 3 of the Lietuvos Respublikos pareiginės algos (atlyginimo) bazinio dydžio nustatymo ir asignavimų darbo užmokesčiui perskaičiavimo įstatymas Nr. XIV-2011 (Law of the Republic of Lithuania No XIV-2011 determining the base rate of salary (remuneration) and amending salary appropriations), of 25 May 2023 (TAR, 2023, No 11589) states:
‘Base rate of salary (remuneration)
1. For the purpose of calculating the salary (remuneration) of the workers referred to in Article 2 of this Law, the base rate of the salary (remuneration) shall be equal to the average monthly salary in the country (including individual companies) for the year 2022, as published by the Valstybės duomenų agentūra (State Data Agency, Lithuania), and is set at EUR 1 785.4.
2. For the purpose of applying the base rate of salary (remuneration) provided for in paragraph 1 of this Article, the recalculated salary may not be lower than the salary (remuneration) prior to that recalculation.’
13. The new system of remuneration for judges of the courts of general jurisdiction and specialised courts of the Republic of Lithuania entered into force on 1 July 2023. Order No 1R-85 of the Lietuvos Respublikos teisingumo ministras (Minister for Justice of the Republic of Lithuania) of 2 April 2004 and a resolution of the Lietuvos advokatų taryba (Lithuanian Bar Association) of 26 March 2004 approved the recommendations on the maximum fees to be awarded for legal services provided by a lawyer in civil cases.
The main proceedings and the questions referred for a preliminary ruling
Case C‑146/23
14. XL was appointed to the Sąd Rejonowy w Suwałkach (District Court, Suwałki, Poland) on 4 December 2003. On 3 April 2007, he was seconded to the Sąd Rejonowy w Białymstoku (District Court, Białystok, Poland) where he currently sits. Since 5 August 2021, XL has been employed on salary grade ‘five’. XL’s monthly remuneration is calculated by multiplying his basic salary of 5 050.48 Polish zlotys (PLN) in 2022 and PLN 5 444.42 in January 2023 by a coefficient of 2.5, to which a 20% of the basic salary supplement for years of service is added. (22) XL brought an action against his employer, the Sąd Rejonowy w Białymstoku (District Court, Białystok), seeking payment of PLN 10 000 for the work that he performed from 1 July 2022 to 31 January 2023 and for statutory default interest on that sum. That amounts to the difference between the salary that XL received from 1 July 2022 to 31 January 2023 and the salary due to him pursuant to the mechanism in Article 91 of the Law relating to the organisation of the ordinary courts. According to XL, that difference is PLN 1 362.12 per month for the months of July to November 2022, PLN 1 053.90 for the month of December 2022 (23) and PLN 2 135.50 for the month of January 2023.
15. The basis for XL’s claim is that the Laws laying down special provisions for the implementation of the budgetary laws for 2021, 2022 and 2023 do not comply with the Law on the organisation of the ordinary courts, the Constitution of the Republic of Poland and EU law since, by reducing his remuneration, they undermine the principle of judicial independence and create conditions that enable the legislature and the executive to influence the content of judicial decisions. XL’s employer claims that it paid him in accordance with the law and that it cannot determine judges’ remuneration on its own initiative.
16. Both parties refer to the Government’s statement of reasons for the draft Laws laying down special provisions for the implementation of the budgetary laws for 2021, 2022 and 2023 but draw diametrically opposite conclusions therefrom. XL highlights the ‘freezing’ of judges’ salaries as compared to an increase in the remuneration of the directors of certain public entities (of between 40% to 60%). XL’s employer refers to the absence of available resources other than those provided in its budget.
17. According to the referring court, Article 91 of the Law relating to the organisation of the ordinary courts lays down the mechanism to calculate the basic salary of judges for a given year by reference to the average salary for the second quarter of the previous year. This mechanism, which was introduced on 22 April 2009, seeks to ensure that the system for the remuneration of judges meets the standard required by Article 178(2) of the Constitution of the Republic of Poland. The 2009 amendment aimed at ensuring that the calculation of judges’ salaries was more objective and reduced the influence of other authorities in fixing the level of judges’ basic salaries. Prior to that change, the system for calculating judges’ salaries was based, inter alia, on a basic amount set out in the annual State budget.
18. The referring court observes that ‘at the initiative of the executive, the mechanism for calculating judges’ basic salary was amended three times by the Laws laying down special provisions for the implementation of the budgetary laws for the years 2021, 2022 and 2023.’ (24) In 2021, judges’ salaries were ‘frozen’ and their basic salary was calculated by reference to the average salary for the second quarter of 2019, rather than by reference to the average salary for the second quarter of 2020. In 2022, judges’ basic salaries were calculated by reference to the average salary for the second quarter of 2020. This resulted in an increase by comparison to the average salary for the second quarter of 2021. In 2023, judges’ salaries were calculated on the basis of a fixed basic amount, (25) rather than on the basis of the average salary for the second quarter of 2022.
19. The amendments to the 2021 State budget were due to the economic situation in Poland in the wake of the COVID-19 outbreak. The provisions relating to the 2022 State budget did not mention any particular circumstances, while those relating to the 2023 State budget refer to the significant budgetary impact of the COVID-19 pandemic and the Russian invasion of Ukraine.
20. In December 2022, the First President of the Sąd Najwyższy (Supreme Court, Poland), (26) the President of the Naczelny Sąd Administracyjny (Supreme Administrative Court, Poland) (27) and the Krajowa Rada Sądownictwa (National Council of the Judiciary; ‘the KRS’) (28) brought separate actions before the Trybunał Konstytucyjny (Constitutional Court, Poland) to challenge the constitutionality of the budgetary provisions for judges’ salaries in 2023. The referring court shares the reservations expressed by the petitioners in those proceedings. It considers that a ‘freeze’ for three years of the system for the calculation of judicial remuneration by reference to an objective parameter, namely, the average salary in the second quarter of the previous year, undermines the independence of the judiciary. It amounts to a threat of a permanent, repeated and consistent reduction of judges’ remuneration with a view to subordinating the judiciary to the executive and legislature. That threat is particularly evident in the light of the recent rule of law crisis in Poland. It is, moreover, completely incomprehensible given the stable financial situation of the Polish State. The referring court also considers that the alteration of the rules for determining judges’ remuneration to the latters’ detriment – particularly when compared to the increase in the cost of living – may have a negative impact on initiatives to improve the functioning of the courts. (29) There is a significant risk that judges would bring a large number of actions to challenge the level of the salaries that they received in 2021, 2022 and 2023.
21. The Sąd Rejonowy w Białymstoku (District Court, Białystok) thus decided to stay the proceedings and to refer the following question to the Court of Justice for a preliminary ruling:
‘Should Article 2 of the Treaty on European Union, which defines the values on which the European Union is based with regard to respect for the rule of law, and the second subparagraph of Article 19(1) of the Treaty on European Union, in conjunction with Article 47 of the Charter of Fundamental Rights of the European Union, which requires Member States to ensure effective legal protection, which is based on the right of access to an independent and impartial tribunal, be interpreted as meaning that the principle of judicial independence precludes provisions of national legislation which, for the purpose of limiting government spending, waives a mechanism for setting judges’ pay on the basis of objective criteria that are independent of arbitrary interference by the executive and legislative authorities, resulting in sustained cuts to the pay of judges, thereby infringing the constitutional guarantees by which judges are granted remuneration consistent with the dignity of their office and the scope of their duties and the administration of justice is carried out by independent courts and independent judges?’
Case C‑374/23
22. The applicants, SR and RB, are judges at the Vilniaus apygardos administracinis teismas (Regional Administrative Court, Vilnius, Lithuania). They brought an action for damages for failure to act against the Lietuvos Respublika (Republic of Lithuania). (30) SR seeks EUR 74 286.09 in damages while RB’s claim is for EUR 95 620.17. (31) The order for reference does not indicate how the claimants arrived at those amounts.
23. SR and RB claim that the level of their remuneration depends on the political will of the executive and the legislature. That is incompatible with the principle of the independence of judges, enshrined in Article 109 of the Lietuvos Respublikos Konstitucija (Constitution of the Republic of Lithuania) and the Republic of Lithuania’s international obligations.
24. The Republic of Lithuania seeks the dismissal of SR and RB’s action. It observes, inter alia, that the base rate for the remuneration of public sector employees is set annually in the light of the State’s financial resources and commitments. From 2018 to 2023, the base rate consistently increased in the light of economic and social conditions, the state’s commitments and the anticipated availability of financial resources. The base rate has a ‘direct economic impact on the private sector and the national average salary’. The Republic of Lithuania also submits that the system for the remuneration of judges falls within the exclusive constitutional discretion of the state and its institutions.
25. According to the Vilniaus apygardos administracinis teismas (Regional Administrative Court, Vilnius), the monthly gross remuneration of regional court judges was EUR 2 440.85 in 2008 and EUR 2 362 in 2021. (32) While judges’ remuneration appears to have increased by approximately 8% over the 13-year period between 2008 and 2021, in reality, judges’ remuneration decreased by 3.2% in nominal terms due to the impact of tax changes alone. The referring court indicated that, since the end of 2021, judges’ remuneration is approaching the level of the national average salary. In the first quarter of 2022, the national average monthly salary was EUR 1 729.90 while the average monthly salary of a judge was EUR 3 113.20. (33)
26. The Vilniaus apygardos administracinis teismas (Regional Administrative Court, Vilnius) observes that whilst the recommended hourly fee to be awarded for a lawyer’s services is EUR 179.90 (34), a regional court judge’s gross salary per hour (35) is approximately EUR 20. The Republic of Lithuania by, inter alia, validating the maximum amount of lawyers’ fees to be awarded, discriminates between lawyers and judges as regards their respective earnings, thereby infringing Articles 29 and 48 of the Constitution of the Republic of Lithuania on non-discrimination and equal treatment in respect of human rights (36) and Article 2 TEU. The Lithuanian Government implicitly recognises that the base rate for judges’ remuneration should not depend on the political will of the legislature or the executive, but on national economic indicators. (37) In that context, the Lithuanian Government has commenced a reform of remuneration in the civil service with the goal of ensuring that State officials’ remuneration is calculated by reference to such economic indicators.
27. In the light of the foregoing, the Vilniaus apygardos administracinis teismas (Regional Administrative Court, Vilnius) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:
‘(1) Are the values of democracy, the rule of law, respect for human rights and justice, enshrined in Article 2 TEU, and the provisions of the second subparagraph of Article 19(1) TEU, to be interpreted as conferring on the legislative and executive powers of the Member States the unrestricted and exclusive discretion to set, by means of national legislation, the remuneration of judges at a rate that depends solely on the will of the legislative and executive powers?
(2) Are the provisions of the second subparagraph of Article 19(1) TEU, as well as those of Article 47 of the Charter, which covers, inter alia, the independence of the judiciary, to be interpreted as permitting the Member States to introduce, by means of national legislation, rules which set the remuneration of judges below the remuneration or fees set by the State in respect of members of other legal professions?’
Procedure before the Court
28. In Case C‑146/23, XL, the Polish Government and the European Commission submitted written observations.
29. In its judgment of 8 November 2023, K 1/23, the Trybunał Konstytucyjny (Constitutional Court) held, inter alia, that Articles 8 and 9 of the ustawa z dnia 1 grudnia 2022 r. o szczególnych rozwiązaniach służących realizacji ustawy budżetowej na rok 2023 (Law laying down special provisions for the implementation of the budgetary law for 2023) of 1 December 2022 are ‘inconsistent with’ Article 178(2) of the Constitution of the Republic Poland.
30. By decision 16 November 2023, the President of the Court of Justice requested the Sąd Rejonowy w Białymstoku (District Court, Białystok), first, to indicate whether it wished to maintain the part of its request for a preliminary ruling relating to the period 1 January 2023 to 31 January 2023 and, second, to indicate the possible impact of the judgment of the Trybunał Konstytucyjny (Constitutional Court) on the legality of Article 8(1) and (2) of the ustawa o szczególnych rozwiązaniach służących realizacji ustawy budżetowej na rok 2022 (Law laying down special provisions for the implementation of the budgetary law for 2022).
31. In its answer of 30 November 2023, the Sąd Rejonowy w Białymstoku (District Court, Białystok) confirmed that the Trybunał Konstytucyjny (Constitutional Court) declared Articles 8 and 9 of the the ustawa z dnia 1 grudnia 2022 r. o szczególnych rozwiązaniach służących realizacji ustawy budżetowej na rok 2023 (38) (Law laying down special provisions for the implementation of the budgetary law for 2023) ‘inconsistent with’, inter alia, Article 178(2) of the Constitution of the Republic of Poland and that those provisions are, accordingly, no longer in force. (39)
32. The Sąd Rejonowy w Białymstoku (District Court, Białystok) also indicated its wish to maintain the entirety of its request for a preliminary ruling, including the part relating to the period of 1 January 2023 to 31 January 2023. According to the Sąd Rejonowy w Białymstoku (District Court, Białystok), the judgment of the Trybunał Konstytucyjny (Constitutional Court) is limited to ruling on the constitutionality of Articles 8 and 9 of the ustawa z dnia 1 grudnia 2022 r. o szczególnych rozwiązaniach służących realizacji ustawy budżetowej na rok 2023 (Law laying down special provisions for the implementation of the budgetary law for 2023) in the light of Article 178(2) of the Constitution of the Republic of Poland and the dignity of the office of judge in conjunction with the scope of judges’ duties. That judgment did not examine the principle of judicial independence and freedom from incursion upon it by the legislature and/or the executive. The Trybunał Konstytucyjny (Constitutional Court) did not, moreover, examine the ustawa o szczególnych rozwiązaniach służących realizacji ustawy budżetowej na rok 2022 (Law laying down special provisions for the implementation of the budgetary law for 2022).
33. In Case C‑374/23, the Lithuanian and Polish Governments and the Commission submitted written observations.
34. By decision of 23 January 2024, the Court joined Case C‑146/23 and Case C‑374/23 for the purposes of the oral procedure and of the judgment.
35. At the hearing on 12 March 2024, the Lithuanian and Polish Governments and the Commission presented oral argument and replied to the Court’s questions.
Assessment
Jurisdiction of the Court in Case C‑374/23
36. The Lithuanian Government (40) observes that Member States have exclusive competence to regulate judges’ and other public office holders’ and servants’ remuneration in accordance with national law. EU law does not, accordingly, have any role to play in that regard. When drafting its budgetary laws, the Lithuanian Government must take into account, inter alia, the socio-economic situation in Lithuania, the needs and resources of the State and its financial commitments. The questions referred by the Vilniaus apygardos administracinis teismas (Regional Administrative Court, Vilnius) ask the Court to rule on the limits of the margin of appreciation that the Lithuanian legislature and executive enjoy as defined in the Constitution of the Republic of Lithuania and as interpreted by the Lietuvos Respublikos Konstitucinis Teismas (Constitutional Court of the Republic of Lithuania). The Court of Justice has no jurisdiction to do so.
37. It is settled case-law that while the organisation of justice in the Member States falls within their competence, the exercise of that competence must comply with EU law and, in particular, the second subparagraph of Article 19(1) TEU. (41) Under the second subparagraph of Article 19(1) TEU,Member States must ensure that courts or tribunals liable to rule on the interpretation or application of EU law (42) meet the requirements of effective judicial protection. (43) That provision precludes national provisions on the organisation of justice that reduce the protection of the value of the rule of law. (44) Member States are thus required to design the organisation of justice in such a way as to ensure that it complies with EU law requirements. These include, in particular, the independence of courts called upon to rule on questions concerning the application or the interpretation of EU law in order to ensure the effective judicial protection of individuals’ rights derived therefrom. (45)
38. It follows from this case-law and, in particular, from the Portuguese judges and the Escribano Vindel judgments, that the Court has jurisdiction to interpret EU law in cases that relate to the organisation of a Member State’s judicial system, including the remuneration of judges.
The admissibility of the questions referred in Case C‑374/23
39. The Lithuanian Government submits that the request for a preliminary ruling in Case C‑374/23 is inadmissible as the questions posed by the Vilniaus apygardos administracinis teismas (Regional Administrative Court, Vilnius) are unrelated to the facts and the object of the litigation before that court. An answer from the Court to the questions referred is thus unnecessary in order to resolve the dispute in the main proceedings.
40. Article 267 TFEU states that question(s) referred for a preliminary ruling must be ‘necessary’ to enable the referring court to ‘give judgment’ in the case before it. The Court has thus repeatedly held that it is clear from both the text and the scheme of Article 267 TFEU that a national court may not request a preliminary ruling unless a case is pending before it in which it is called upon to give a decision that is capable of taking account of the preliminary ruling. (46)
41. The main proceedings in Case C‑374/23 concern an application for damages against the Republic of Lithuania brought by two judges, SR and RB, in which they claim that the powers of the legislature and executive to determine their remuneration is incompatible with the independence of the judiciary. That constitutes a connecting factor between the dispute before Vilniaus apygardos administracinis teismas (Regional Administrative Court, Vilnius) and the interpretation of EU law that that court seeks. I therefore advise that the Court’s interpretation is ‘necessary’ to enable the referring court to decide the dispute before it. (47)
Relevance of Article 2 TEU and Article 47 of the Charter in Joined Cases C‑146/23 and C‑374/23
42. According to the Lithuanian Government, since the regulation of judges’ remuneration falls within the Member States’ exclusive competence, they do not implement EU law when they determine that remuneration. It follows that, pursuant to Article 51(1) thereof, the Charter does not apply to the main proceedings.
43. Article 51(1) of the Charter addresses its provisions to the Member States only when they implement EU law. It is not apparent from the orders for reference in Cases C‑146/23 and C‑374/23 that XL or SR and RB rely on a right that a provision of EU law confers on them or that they are the subjects of proceedings that implement EU law. Nor do the orders for reference indicate that they raise any issue as to the interpretation or the application of a rule of EU law. Nothing in the requests for a preliminary ruling shows that any person relies on the right to an effective remedy enshrined in Article 47 of the Charter. It thus appears that Article 47 of the Charter cannot be invoked in the context of the main proceedings. (48)
44. Article 19 TEU gives concrete expression to the value of the rule of law contained in Article 2 TEU. In accordance with the second subparagraph of Article 19(1) TEU, the Member States must establish a system of legal remedies and procedures that ensure a right to effective judicial protection for individuals in the fields covered by EU law. The effective judicial protection of individuals’ rights under EU law is a general principle of EU law that stems from the constitutional traditions common to the Member States (49) and which Article 47 of the Charter reaffirms. (50) In those circumstances, I advise the Court that it is unnecessary to interpret Article 2 TEU separately from Article 19 TEU. (51)
Substance
45. By their questions, the Sąd Rejonowy w Białymstoku (District Court, Białystok) and the Vilniaus apygardos administracinis teismas (Regional Administrative Court, Vilnius) seek an interpretation of the second subparagraph of Article 19(1) TEU in respect of two issues. First, does that provision contemplate the legislature and/or the executive making laws to determine, or to reduce, judges’ remuneration. Second, when Member States enact such laws, what criteria must they respect so as to comply with that provision.
46. It is settled case-law that EU law does not require Member States to adopt a particular constitutional model to govern the relationships and the interaction between the various branches of State, in particular as regards the definition and the delimitation of their respective competences. In choosing their constitutional models, Member States must comply, inter alia, with the second subparagraph of Article 19(1) TEU by not eroding judicial independence or encroaching upon the judicial function. (52) Given the Member States’ different political and constitutional structures and traditions, the roles played by the actors involved in determining the level and elements of judges’ remuneration may vary considerably. (53) In a democracy, the principle of the separation of powers and the need to insulate the judiciary from undue external influence from, inter alia, the legislature and/or the executive does not exclude the latter from determining many aspects of a State’s judicial architecture, including judges’ remuneration.
47. To ensure transparency, objectivity and legal certainty, (54) Member States must lay down a legal framework to facilitate the determination of judges’ remuneration, to include identifying the actors involved in that process and their allotted roles. (55) That framework must seek to protect judicial independence through ensuring that the level of judges’ remuneration is commensurate with the importance of their functions. National laws governing judges’ remuneration must operate on the basis of relevant, objective and verifiable criteria that respect the principle of proportionality. It follows that judges’ remuneration cannot be determined or reduced on a discretionary basis or by reference to individual circumstances. A national law aimed at reducing the level of judges’ remuneration must set out, in clear terms, the justification therefor. Such reductions in judicial remuneration as may result therefrom must be temporary and their amount and their duration tailored to, and evolve with, the gravity and persistence of the conditions that justified their adoption. Under no circumstances can such reductions in remuneration target the judiciary for unfavourable treatment. (56) In order to assess whether the judiciary is targeted, such reductions must take account of the evolution of judges’ and comparable public office holders’ remuneration, having regard, in particular, to any recent increases therein. (57) To ensure compliance with these principles and to enforce their stability, rules on judges’ remuneration or any reduction thereof must be subject to judicial control. (58)
48. The requests for a preliminary ruling refer to the level of judges’ basic remuneration in Poland and Lithuania. (59) In the light of the definition of ‘pay’ in the first subparagraph of Article 157(2) TFEU, any consideration, whether in cash or in kind, immediate or future, which judges’ receive directly or indirectly in respect of that employment must be taken into account when assessing whether their remuneration is commensurate with the importance of their functions. (60) Increments or allowances received for exercising certain functions or additional tasks or responsibilities, (61) seniority, length of service or experience, non-contributory or subsidised occupational retirement pensions (62) and healthcare additional to that provided to workers in general under a national welfare scheme, housing and use of a vehicle or phone for private purposes are examples of remuneration in cash or kind to be taken into account. (63) Limitations or impediments on the exercise by judges of other economic activities (64) must also be factored into an assessment of the adequacy of their remuneration. (65)
49. In the absence of harmonisation, the varying socio-economic conditions across the European Union, and the different budgetary constraints individual Member States face, they are usually best placed to determine the remuneration of judges within their jurisdiction. Subject to the overriding obligations in the second subparagraph of Article 19(1) TEU, Member States therefore enjoy a margin of appreciation in determining the level of judges’ remuneration. That margin of appreciation is not unlimited. Objective elements, such as the average or minimum national salary – multiplied by a coefficient – or the salaries of other national public office holders and servants with equivalent responsibilities, are examples of acceptable benchmarks that Member States may rely upon, in conjunction with other socio-economic parameters such as the cost-of-living (the consumer price index in a Member State), rate of inflation, etc., to calculate judges’ remuneration. (66) Since wage levels, including minimum wage levels, are not harmonised in the European Union (67) and vary greatly given the significant disparities between the socio-economic conditions that prevail in the different Member States, (68) a bare comparison of remuneration in simple monetary terms is inadequate. Judges’ remuneration thus falls to be assessed in the precise national socio-economic context of each Member State. (69)
50. An assessment of the adequacy of judges’ remuneration must verify if, in a given national socio-economic context, it is at a level that is sufficient to attract, retain and motivate persons of high moral integrity from diverse backgrounds having the necessary professional qualifications and/or experience. (70) Inadequate remuneration may undermine morale, reduce productivity and ultimately hinder recruitment by discouraging qualified candidates from entering the profession. The retention of judges may also be affected as low pay may encourage individuals to leave the profession or to retire before the end of their mandate or compulsory retirement age, thereby reducing the general level of judicial experience. (71)
51. In the absence of any indication that judges’ remuneration is taxed unlawfully or disproportionately, (72) the principle of effective judicial protection is not an obstacle to any taxes or other charges – such as social security payments – that a Member State lawfully levies on judges’ remuneration by reference to objective, non-discriminatory criteria. The burden of such general charges thus does not feature as part of a review as to the compatibility of a system of judicial remuneration with the second subparagraph of Article 19(1) TEU.
52. A comparison of judges’ remuneration with the level of fees lawyers charge or are awarded when they advise or are instructed by the State is also excluded, even where the law lays down a scale for those fees. While the level of judges’ remuneration cannot be divorced from private sector earnings (73) in similar fields, the judicial function is in the nature of a public service, not a commercial endeavour. (74) It entails a conscious career choice to work in the public sphere in return for, inter alia, security of tenure and stable monetary compensation. (75) While that may result in a lower level of remuneration than lawyers in private practice may charge in certain instances, judges are not exposed to commercial risks, (76) they do not have to meet the cost of overheads, (77) they are not subject to VAT and, in principle, they are paid irrespective of the outcome of proceedings, their output or their productivity. (78) Finally, I might add that while judges are paid at regular, predictable intervals, the timeframe within which clients pay their lawyers’ fees can be both long and highly unpredictable. (79)
53. An assessment of the adequacy of judges’ remuneration therefore has both a holistic perspective, taking account of all relevant socio-economic factors, and a dynamic or temporal aspect, by reference to the evolution of that remuneration over time. While it may not be imperative that Member States update judges’ remuneration automatically to account for inflation and/or rises in the cost of living or review pay levels at specific intervals, a persistent failure to do so may lead to a depreciation in its value. A significant erosion of the level of judges’ remuneration over time is prejudicial to judicial independence and to the dignity of the judicial office. Unless there is a sudden sharp decrease in its value, an examination of the evolution of judges’ remuneration ought to be carried out by reference to a representative period of at least ten years.
54. So far as the present joined cases are concerned, Polish and Lithuanian law lays down a framework to determine judges’ remuneration. (80) There is nothing in the proceedings before the Court that would tend to indicate that, in so doing, the Polish or the Lithuanian legislature and/or executive usurped the role or the powers of any other legitimate actor. (81) These references for a preliminary ruling also show that, in those Member States, the rules governing judicial remuneration, and any reduction thereof, are subject to judicial control.
55. Case C‑146/23 arises from the laws laying down special provisions for the implementation of the budgetary laws for 2021, 2022 and 2023 (82), which amended Article 91 of the Law on the organisation of the ordinary courts and made reductions in judges’ remuneration. It is not alleged that the Polish legislature and/or executive did not have the power under Polish law to amend Article 91 of the Law relating to the organisation of the ordinary courts by the Laws laying down special provisions for the implementation of the budgetary laws for 2021, 2022 and 2023. The full extent of the impact of the judgment of 8 November 2023, K 1/23, of the Trybunał Konstytucyjny (Constitutional Court) (83) on those budgetary laws remains somewhat unclear. At the hearing, the Polish Government confirmed, in response to questions put by the Court, that remuneration due to judges in the wake of that judgment had been paid. In Case C‑374/23, SR and RB brought an action for damages against the Republic of Lithuania arising from its failure to act as no other legal proceedings are available to require the legislature and the executive to pay judges remuneration commensurate with the dignity of their functions. It is clear from the Savickas judgment (84) that the reduction of judges’ remuneration may be challenged before the Lithuanian courts and that financial remedies are available to recover remuneration unlawfully unpaid.
56. The referring court in Case C‑146/23 considers that the amendments to Article 91 of the Law relating to the organisation of the ordinary courts in 2022 and 2023 are contrary to the second subparagraph of Article 19(1) TEU. Unlike the measures in the Portuguese judges judgment, (85) the Polish amendments are not general in nature but specifically target judges, establishing a lasting derogation from the mechanism set out in Article 91(1) of the Law on the organisation of the ordinary courts.
57. It is undisputed that judges’ remuneration (86) in Poland in 2022 and 2023 was lower than if it had been calculated in accordance with Article 91 of the Law relating to the organisation of the ordinary courts. That reduction also coincided with a significant increase in the cost of living in that Member State. It may, however, be observed that during that same period judges’ remuneration was not lower than it had been in previous years but appears to have increased by 4.37% in 2022 as compared to 2021, and by 7.8% in 2023 as compared to 2022. The Polish Government claimed that the amendments in question did not ‘freeze’ judges’ remuneration but merely slowed its rate of increase. While XL refers to a long list of public servants who received higher pay rises than judges in 2022, at the hearing the Polish Government pointed out that ordinary public servants in that Member State earn considerably less than judges and, unlike judges, did not receive a recent pay rise.
58. As regards the allegedly permanent nature of the amendments in Poland, while Article 91 of the Law relating to the organisation of the ordinary courts appears to have been amended for three consecutive years, (87) it appears to remain in force. The Polish Government confirmed at the hearing that each of the amendments to that provision introduced by the Laws laying down special provisions for the implementation of the budgetary laws for 2021, 2022 and 2023 related to a single budgetary year and were each valid for one year only. There is, moreover, no indication in the file before the Court that similar amendments are proposed to Article 91 of the Law relating to the organisation of the ordinary courts in 2024. (88) The effects of the amendments to Article 91 of the Law relating to the organisation of the ordinary courts and on judges’ remuneration thus appear to be limited in both duration and in size.
59. At first glance, these disputed amendments might appear to have targeted or singled out judges’ and prosecutors’ remuneration since the salaries of other public office holders and servants were not subject to analogous measures. The Polish Government indicated, both in its written observations and at the hearing, that judges and prosecutors had previously received preferential treatment under that state’s remuneration policy for public office holders and servants. The Polish Government further claimed that judges and prosecutors had been exempt from a public sector pay freeze from 2013 to 2018. These elements indicate that, from 2013 to 2023, judges’ remuneration may not have been negatively targeted or disproportionately affected as compared to that that which other public office holders or servants received. (89) It further appears that, during that period, there was no substantial erosion of their remuneration. (90)
60. The Polish Government justified the 2022 and 2023 amendments by reference to the COVID-19 pandemic and the Russian invasion of Ukraine in February 2022. These are, in my view, relevant, objective, verifiable and extraordinary circumstances that undoubtedly imposed considerable budgetary constraints on all Member States, including the Republic of Poland, and were capable of justifying a reduction in public office holders’ and servants’ remuneration, including that of judges. A reduction in judges’ remuneration in compliance with the second subparagraph of Article 19(1) TEU does not require the existence of a national budgetary crisis or the opening of an excessive deficit procedure pursuant to Article 126(2) TFEU and Protocol No 12 on the excessive deficit procedure. (91) Reductions in judges’ remuneration and other budgetary cuts may be justified in an effort to avoid precipitating an excessive deficit in a Member State. (92) As for the proportionality of the measures adopted in response to those circumstances, the request for a preliminary ruling in Case C‑146/23 indicates that XL’s remuneration in 2022 and 2023 was significantly greater than twice the average salary in Poland. (93)
61. While it is ultimately a matter for the referring court to decide upon, the matters to which points 56 to 60 of the present Opinion refer tend to indicate that judges’ remuneration in Poland in 2022 and 2023 was commensurate with their independence and the importance of their functions.
62. In Case C‑374/23, the Vilniaus apygardos administracinis teismas (Regional Administrative Court, Vilnius) stated that over the 13-years between 2008 and 2021, judges’ remuneration decreased by 3.2% in nominal terms due to tax changes alone. The referring court did not provide any details on the 2019 tax reform in Lithuania. In any event, as point 51 of the present Opinion indicates, the taxation of judges’ remuneration is, as a general rule, irrelevant to an assessment in the context of the second subparagraph of Article 19(1) TEU.
63. The Lithuanian Government and the Commission submit that, in accordance with Article 3 of the LRJ, the base rate for calculating judges’ and other public office holders’ or servants’ salary is based on clear and objective parameters linked to the socio-economic conditions prevailing in the Republic of Lithuania. (94) It is, in principle, updated annually and cannot be lower than the previous year. There is no suggestion in Case C‑374/23 that judges’ remuneration in Lithuania was targeted, or disproportionately affected, as compared to that of other public office holders or servants. It is clear, inter alia, from Article 3 of the LRJ that their remuneration is determined in tandem with that of other public office holders and servants. That is also the case with respect to the reform of public service remuneration adopted on 25 May 2023. (95) The fact that that reform increased (substantially) judges’ remuneration and that of other public office holders and servants does not, pursuant to the second subparagraph of Article 19(1) TEU, call into question the lawfulness of amounts previously paid to judges.
64. The Vilniaus apygardos administracinis teismas (Regional Administrative Court, Vilnius) indicated that the relative level of judges’ remuneration in Lithuania has been eroded over time and that, since the end of 2021, it approaches the level of the national average salary. The Lithuanian Government claimed at the hearing that the figures the referring court submitted are incorrect as they do not reflect arrears paid to judges between 2016 and 2019 in the wake of the judgment of the Lietuvos Respublikos Konstitucinis Teismas (Constitutional Court of the Republic of Lithuania) which declared a reduction in judges’ remuneration unconstitutional. (96)
65. While the adequacy of judges’ remuneration in the main proceedings is ultimately a matter for the Vilniaus apygardos administracinis teismas (Regional Administrative Court, Vilnius) to assess, Figure 3.36 of the 2020 CEPEJ Report (97) and Figure 3.46 of the 2022 CEPEJ Report (98) indicate that the average gross salary of judges of the Lietuvos Aukščiausiasis Teismas (Supreme Court, Lithuania) was 2.2 (2018) or 2.1 (2020) times higher than the national average gross salary. (99) A comparison of the data from other Member States tends to show that, in 2018, the remuneration of Lithuanian judges (100) at the beginning of their career at that State’s Supreme Court is in the mid-range and higher in relative terms than that of comparable Austrian (1.5), Belgian (1.6), Finnish (1.5), French (1.3), Croatian (1.7), Dutch (1.3), German (0.9), Hungarian (1.8), Italian (1.9), Luxemburgish (1.4), Latvian (1.9), Slovenian (1.6), Swedish (1.8) and Spanish (2.1) judges. (101)
Conclusion
66. In the light of the foregoing, I propose that the Court answer the questions referred by the Sąd Rejonowy w Białymstoku (District Court, Białystok, Poland) and the Vilniaus apygardos administracinis teismas (Regional Administrative Court, Vilnius, Lithuania) as follows:
The second subparagraph of Article 19(1) TEU
must be interpreted as not precluding the legislative and/or the executive of Member States from making laws to determine and/or to reduce judges’ remuneration, including by way of collective agreements made in accordance with national law.
as requiring Member States to lay down a legal framework to facilitate the determination of judges’ remuneration that seeks to protect judicial independence through ensuring that the level of judges’ remuneration is commensurate with the importance of their functions. Laws governing judges’ remuneration must operate on the basis of relevant, objective and verifiable criteria that respect the principle of proportionality.
as requiring that any assessment of the adequacy of the level of judges’ remuneration take account of all relevant socio-economic factors and refer to the evolution of that remuneration over time.
as requiring that any national law aimed at reducing the level of judges’ remuneration set out, in clear terms, the justification therefor. Such reductions in judicial remuneration as may result therefrom must be temporary and their amount and their duration tailored to, and evolve with, the gravity and persistence of the conditions that justified their adoption. Under no circumstances can such reductions target the judiciary for unfavourable treatment.
as requiring that rules on judges’ remuneration or any reduction thereof are subject to judicial control.