The Constitutional Court annuls the Dismissal Decree

The Constitutional Court annulled the Dismissal Decree by its judgment of 5 June 2025. This decree had allowed Flemish provincial and local administrations to dismiss statutory staff members in accordance with the rules applicable to the termination of employment contracts for contractual staff. It also granted jurisdiction to the labour courts and tribunals for disputes concerning the termination of statutory employment. The flexibility that administrations had obtained to terminate the employment of statutory staff is now curtailed by the Constitutional Court’s judgment. With this judgment, the Constitutional Court does not challenge the contractualisation of the public sector, but rather gives substance to the standstill principle for current statutory staff.

The essence of the Dismissal Decree

The Dismissal Decree, a Flemish decree of 16 June 2023, amended the dismissal rules for statutory staff members of Flemish provincial and local administrations (e.g., municipalities, Public Centres for Social Welfare, autonomous municipal companies, etc.).

The Flemish legislator considered it necessary to modernise and make the dismissal rules for statutory staff in provincial and local administrations more flexible, in light of the principle of adaptability and the general interest. The aim was to ensure equal treatment between statutory and contractual staff members with regard to the termination of employment.

Specifically, the dismissal rules applicable to contractual staff, i.e., those set out in the Employment Contracts Act, were declared applicable by analogy to statutory staff members. This allowed provincial and local administrations, for example, to terminate the employment of a statutory member of staff by giving notice, by paying a severance pay in lieu of notice, or through a dismissal for serious cause.

In addition, jurisdiction over disputes arising from the termination of statutory employment was transferred to the labour courts and tribunals. This authority was removed from the Council of State and assigned to the labour courts, thereby granting statutory staff members the same legal protection as contractual staff.

The Dismissal Decree entered into force on 1 October 2023.

The test of the Constitutional Court

Several stakeholders, including statutory staff members and trade unions, filed an application for annulment with the Constitutional Court. Among other things, they alleged a violation of the rules on the division of powers and of the constitutional standstill principle. According to this principle, the legislator may not significantly reduce the level of protection provided by existing legislation without reasonable justification.

The Constitutional Court ruled that the Flemish legislator did not exceed its powers by declaring the rules concerning the termination of employment contracts applicable by analogy to statutory staff, nor by assigning jurisdiction over related disputes to the labour courts and tribunals. This approach was therefore positively received.

The Constitutional Court also upheld the expansion of the dismissal grounds to include dismissals based on operational necessities of the administration. Prior to the Dismissal Decree, this was not an explicitly recognised ground for dismissal. The Court found this additional ground to be reasonably justified in light of the objective to modernise and increase the flexibility of the termination of statutory employment. This too is a positive outcome for the Flemish legislator.

However, the Dismissal Decree ultimately failed because it no longer allowed the administration to be compelled to reinstate a staff member to their former position in the event of an unlawful termination, a consequence that would normally follow from an annulment of a dismissal decision by the Council of State. A staff member who was unlawfully dismissed could only claim compensation, for example in cases of manifestly unreasonable dismissal. 

The Constitutional Court considered the removal of the reinstatement obligation to be a significant reduction in the existing level of protection regarding the right to labour and the right to fair working conditions. According to the Court, this substantial deterioration could not be justified by the legislator’s objective of modernising and increasing the flexibility of the termination of statutory employment.

With this ruling, the Constitutional Court does not challenge the ongoing trend of contractualisation in the public sector, but rather gives concrete effect to the standstill principle for current statutory staff.

Annulment of the Dismissal Decree and its consequences

Although only the removal of the reinstatement obligation was found to be unconstitutional, the Constitutional Court annulled the Dismissal Decree in its entirety. This is because the various elements of the dismissal scheme introduced by the Decree formed an inseparable whole.

Several provincial and local administrations had already dismissed statutory staff members by using the provisions of the Dismissal Decree. These administrations assumed that the employment of the staff member in question had been definitively terminated and that, at most, a financial compensation would be owed, allowing them to immediately proceed with replacing the staff member.

To avoid legal uncertainty and in consideration of the organisational difficulties that could result from the annulment of the Dismissal Decree, the Constitutional Court rightly decided to maintain the effects of the Decree up until the date of its judgment.

This means that dismissals given between 1 October 2023 and 5 June 2025 remain valid and definitive. Administrations cannot be compelled to reinstate a dismissed staff member. The labour courts and tribunals also retain jurisdiction over disputes related to these dismissals.

Key message

As of 6 June 2025, Flemish provincial and local administrations are no longer permitted to terminate the employment of statutory staff members in accordance with the rules governing the termination of employment contracts for contractual staff. The previous legal framework has been reinstated.