Dear Mr X,

You submitted a complaint to the European Ombudsman against the European Investment Bank (the EIB).

In your complaint, you disagree with the EIB’s decision not to base its annual salary adjustments for its staff on the rates of inflation in Luxembourg. You argue that the EIB failed to provide a methodology for general salary adjustments (so-called ‘GSAs’).

Based on the information provided to us, the Ombudsman closes the case finding no maladministration.^[1]

The reason for this is that, contrary to what you state in your complaint, the EIB did in fact provide a methodology for salary adjustments. Furthermore, there is nothing in your complaint to suggest that the EIB committed a manifest error when determining its “new approach” for GSAs. Let me explain:

According to EU case law, the EIB has a discretion under its Staff Regulations in “establishing and unilaterally changing the components of staff remuneration, and consequently in setting and updating the scale of basic staff salaries” for its staff,^[2] so long as it determines in advance the criteria for this.^[3]

Following the expiry at the end of 2016 of its inflation-based criteria, the EIB put in place a new criteria in July 2017, applicable to staff salaries as from 2018. The new criteria clearly set out in advance the factors to be taken into account:

“[T]he decision by the Board on the budget is guided by the market data available in the [Annual Report on Renumeration]. It is important to reiterate that the market data are not binding for the Board decision. In fact, the Board may consider other factors such as the Bank’s overall performance and/or inflation and/or the general labour market conditions in the Member States. [...]

For SR I [Staff Regulations I], as a matter of principle, the [Management Committee] maximises the budget utilisation to focus and reward staff performance. However, the room for manoeuvre has to consider some key elements of constraint. Specifically, the Bank should have sufficient budgetary resources to apply the “minimum merit grid”, in compliance with the principles of Article 22 of the Staff Regulations I.”

Contrary to what you argue in your complaint, there is no obligation on the EIB under the Rome I rules^[4] to use the same salary adjustment as the one applied by authorities in Luxembourg under national employment legislation^[5]. As the EU Courts have ruled, the EIB’s Staff Regulations govern its employment relationship with its staff^[6], not the laws of Luxembourg or of another Member State. By the same token, the Rome I rules do not apply to the EIB because they are binding on EU Member States only. ^[7]

In your complaint, you also claim that the EIB’s decision was “possibly retaliation for having lost” an EU Court case^[8]. I regret to say that this aspect of your complaint is inadmissible since this concern was not raised with the EIB before turning to the Ombudsman.^[9] In any event, it would not serve any useful purpose to inquire into this aspect since the new GSA critieria were adopted before the EU Court delivered its judgment on the case in question.

I realise that this decision will disappoint you, but I hope that the above information and explanations are nevertheless helpful.

Yours sincerely,

 

Lambros Papadias

Head of Inquiries - Unit 3

Strasbourg, 13/08/2019

 

[1] Full information on the procedure and rights pertaining to complaints can be found at https://www.ombudsman.europa.eu/en/document/70707.

[2] Paragraph 48 of the judgment of the General Court of 14 September 2017, Jean-Pierre Bodson and Others v EIB, T-504/16 and T-505/16: http://curia.europa.eu/juris/liste.jsf?num=T-504/16&language=EN

[3] See case law cited above, paragraph 49.

[4] Recital 2 and Article 29 of Regulation (EC) No 593/2008 of the European Parliament and of the Council of 17 June 2008 on the law applicable to contractual obligations (Rome I): https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex:02008R0593-20080724. 

[5] Article L 223-1 of the Luxembourgish Employment Code requires salaries to be adapted to the cost of living. The rate is set by Statec.

[6] See paragraph 51 of the judgment of the General Court of 26 February 2016, Jean-Pierre Bodson and Others v EIB, T-241/14: http://curia.europa.eu/juris/liste.jsf?num=T-241/14&language=EN

[7] Recital 2 and Article 29 of Rome I. 

[8] See footnote 2.

[9] Article 2(4) of the Statute of the European Ombudsman.