JUDGMENT OF THE CIVIL SERVICE TRIBUNAL (Third Chamber)

30 September 2010

Case F-29/09

Giorgio Lebedef and Trevor Jones

v

European Commission

(Civil service — Officials — Remuneration — Article 64 of the Staff Regulations — First subparagraph of Article 3(5) and Article 9 of Annex XI to the Staff Regulations — Correction coefficient — Equal treatment)

Application: brought under Articles 236 EC and 152 EA, in which Mr Lebedef and Mr Jones seek annulment of an alleged decision of the Commission refusing to increase the purchasing power of officials employed in Luxembourg (Luxembourg) to a level equivalent to that of officials employed in Brussels (Belgium) and, in the alternative, annulment of their pay slips as from June 2008.

Held: The action is dismissed. The applicants are ordered to pay all the costs, with the exception of those incurred by the Council of the European Union, intervener for the Commission. The Council is ordered to bear its own costs.

Summary

1.      Plea of illegality — Measures the illegality of which may be pleaded

(Arts 230, second para., EC, 236 EC and 241 EC; Arts 236, second para., TFEU, 270 TFEU and 277 TFEU)

2.      Officials — Actions — Act adversely affecting an official — Definition — Pay slip

(Art. 265 TFEU; Staff Regulations, Arts 90 and 91(1); Annex XI, Art. 3(5), first para.)

3.      Officials — Remuneration — Weightings — Fixing — Powers of the Council — Discretion — Limits — Respect for the principle of equal treatment — Judicial review — Limits

(Staff Regulations, Arts 64 and 65)

4.      Officials — Remuneration — Weightings — No correction coefficient for Belgium and Luxembourg — Breach of the principle of equal treatment – Burden of proof

(Staff Regulations, Annex XI, Art. 3(5), first para.)

5.      Officials — Principles — Protection of legitimate expectations — Conditions

1.      Article 241 EC (now, after amendment, Article 277 TFEU) provides that in proceedings in which the lawfulness of a regulation referred to in that provision is at issue, any party may plead, in particular, in support of an action against an implementing measure, the grounds specified in the second paragraph of Article 230 EC (now, after amendment, the second paragraph of Article 263 TFEU), even after expiry of the time-limit for bringing an action against the regulation. That remedy is the expression of a general principle which ensures that every person has or will have had the opportunity to challenge a legal act deriving from the Union which forms the basis of an act adversely affecting him. The rule laid down in Article 241 EC is evidently applicable in proceedings brought before the Court of the European Union under Article 236 EC (now, after amendment, Article 270 TFEU).

However, the possibility provided by Article 241 EC of invoking the inapplicability of a regulation does not constitute an independent right of action and may only be sought incidentally, so that where there is no right to bring the main action or where the main action is inadmissible the plea of illegality must also be declared inadmissible.

(see paras 29-30)

See:

92/78 Simmenthal v Commission [1979] ECR 777; 33/80 Albini v Council and Commission [1981] ECR 2141, para. 17; 262/80 Andersen and Others v Parliament [1984] ECR 195; C-11/00 Commission v ECB [2003] ECR I-7147, paras 74 to 78; 89/86 and 91/86 Étoile commerciale and CNTA v Commission [1987] ECR 3005, para. 22

2.      A pay slip, by its nature and purpose, does not possess the characteristics of an act adversely affecting an official within the meaning of Articles 90(2) and 91(1) of the Staff Regulations, since it merely represents in financial terms the substance of previous administrative decisions relating to the personal and legal situation of the official. However, in so far as it clearly reveals the existence and the content of an administrative decision of individual application, which had hitherto not been disclosed, provided that it had not been formally notified to the official concerned, the pay slip, containing the statement of the financial rights, may be regarded as an act adversely affecting the official concerned and capable of forming the subject-matter of a complaint and, where necessary, an action, for which it has the effect of causing time to begin to run.

In that respect, in an action seeking to take issue with an institution, essentially, for not having taken the political initiatives necessary for a specific correction coefficient to be established in future for Luxembourg, which presupposes that the first subparagraph of Article 3(5) of Annex IX to the Staff Regulations must be repealed, and in order to maintain their right of action, it is accepted that officials may challenge their pay slips by raising against a provision of the Staff Regulations fixing their pecuniary rights a plea of illegality alleging, in particular, breach of the principle of equal treatment.

It is true that, since Article 90(1) of the Staff Regulations only empowers officials to request the administration, acting in its capacity as appointing authority, to take a decision relating to them, such a request falls outside the scope of that provision, since a political initiative cannot be characterised as a ‘decision relating to [an official]’.

However, in the light of the procedural difficulties that would be encountered by an individual intending to bring an action for failure to act, under Article 265 TFEU, against an institution in order to have a provision of a regulation adopted by the EU legislature repealed, to preclude the possibility for an official to challenge his pay slip on the ground of a change in factual circumstances, such as a change in economic conditions, by raising, on that occasion, a plea of illegality against a provision of the Staff Regulations which, while perhaps valid when adopted, has, in the submission of the official concerned, become unlawful as a consequence of that change in circumstances, would render it practically impossible to exercise a remedy designed to ensure compliance with the general principle of equal treatment recognised by EU law and would thus constitute a disproportionate interference with the right to effective judicial protection.

(see paras 33, 40-42)

See:

C‑107/91 ENU v Commission [1993] ECR I‑599, paras 16 and 17

T-181/97 Meyer and Others v Court of Justice [1998] ECR-SC I‑A‑151 and II‑481; T-354/03 Reggimenti v Parliament [2005] ECR-SC I‑A‑33 and II‑147, paras 38 and 39

F-103/05 Pickering v Commission [2008] ECR-SC I‑A‑1‑101 and II‑A‑1‑527, paras 72 and 75; F-112/05 Bain and Others v Commission [2008] ECR-SC I‑A‑1‑111 and II‑A‑1‑579, paras 73 and 76

3.      The purpose of the correction coefficients affecting officials’ salaries provided for in Articles 64 and 65 of the Staff Regulations is to ensure that equivalent purchasing power is maintained for all officials, whatever their place of employment, in accordance with the principle of equal treatment.

It is for the Council, in accordance with Article 65(2) of the Staff Regulations, to establish whether there is an appreciable variation in the cost of living between the various places of employment and, where appropriate, to draw conclusions by adjusting the correction coefficients. The principle of equal treatment, which aims to ensure the establishment of those correction coefficients, is also binding on the Union legislature.

The principle of equal treatment cannot, however, require perfect identity of officials’ purchasing power, whatever their place of employment, but substantial correspondence of the cost of living between the places of employment concerned. In view of the complexity of the matter, the Union legislature has in that regard a wide discretion and intervention by the judicature must be limited to examining whether the institutions remained within reasonable limits by reference to the considerations which prompted their action and did not use their powers in a manifestly incorrect manner.

(see paras 62, 63, 67)

See:

194/80 Benassi v Commission [1981] ECR 2815, para. 5; C-301/90 Commission v Council [1992] ECR I‑221, paras 19, 24 and 25; judgment of 29 April 2004 in C-187/03 P Drouvis v Commission, not published in the ECR, para. 25 and the case-law cited therein

T-544/93 and T-566/93 Abello and Others v Commission [1995] ECR-SC I‑A‑271 and II‑815, para. 76

4.      In an action brought by officials employed in Luxembourg alleging that they suffer discriminatory treatment owing to the absence of a specific correction coefficient for that Member State, under the first paragraph of Article 3(5) of Annex XI to the Staff Regulations, the applicants cannot be bound to demonstrate before the Court of the European Union, to the requisite legal standard, the existence of an appreciable and sustainable increase in the cost of living in Luxembourg, by comparison with Brussels, capable of establishing the existence of unequal treatment of officials, according to their place of employment. All that they are required to do is to produce a body of sufficiently significant indicia disclosing a possible difference in purchasing power of such a kind as to place the burden of proof on the defendant institution and, where appropriate, to warrant administrative investigations being undertaken by Eurostat.

Furthermore, where it is alleged that the defendant institution applied the first paragraph of Article 3(5) of Annex XI to the Staff Regulations without having undertaken a study of the possible difference in purchasing power between Brussels and Luxembourg, judicial review is not limited to ascertaining whether there has been a manifest error of assessment, but goes to whether or not the applicants have adduced sufficient indicia, such as sufficiently substantiated figure-based or other studies from an authorised source, that would justify initiating an investigation.

(see paras 64, 66, 68)

5.      Where he has not been given precise assurances by the administration, an official cannot rely on the principle of protection of legitimate expectations in order to challenge the legality of a provision of the Staff Regulations and to object to its application. Promises made by the administration which do not have regard to the provisions of the Staff Regulations cannot give rise to a legitimate expectation on the part of the person to whom they are addressed.

(see para. 72)

See:

T-123/89 Chomel v Commission [1990] ECR II‑131, paras 26 to 30; T-175/03 Schmitt v EAR [2004] ECR-SC I‑A‑211 and II‑939, paras 46 and 47