Criminal liability arises from an employer’s failure to fulfil the obligation to pay an employee’s wages on time. Pursuant to Article 8 para. 1 of Law 2336/1995, the non-payment of wages due constitutes a criminal offence and is punishable by imprisonment of up to 6 months and a monetary penalty, where the employer who is liable fails to pay the entitled wage-earner the remuneration owed to them within the time limit provided by the individual employment contract or the law. The offence is prosecuted following a formal complaint by the employee or by the bodies of the Labour Inspectorate, or also ex officio. The flagrante delicto procedure also applies to the trial of this offence.
The existence of a contract of dependent employment, whether of indefinite or fixed duration, is among the prerequisites for establishing the above offence. However, a valid employment contract is not necessarily required. Secondly, it is required that the employer fail to pay the wages owed within the prescribed time limit, and thirdly, it has been held by Areios Pagos that the protective function of the law covers, in addition to the salary, all other wage-related benefits provided by the employer as consideration for the work performed. However, with regard to benefits in kind of a wage-related or other character, which the employer grants to the employee, these are not included in regular remuneration, nor do they constitute income, and therefore are not subject to the criminal protection of the law, provided that they serve the operational needs of the business.
Furthermore, the criminal protection of the annual statutory leave to which the employee is entitled is provided for in Article 5 para. 7 of Law 539/1945. Where the employer wilfully fails to grant the statutory leave to the wage-earner, they bear, in addition to civil, also criminal liability and are punished in accordance with the law.
Areios Pagos interprets the provision on the criminal liability of the employer narrowly, limiting it to wages actually due and excluding wages of mora creditoris or other claims. Recently, however, by virtue of Law 3996/2011, Article 28, the non-payment of severance pay has been rendered a criminal offence. The law, however, protects the employee’s claim for the payment of statutory severance pay, criminalising only the non-payment of this, and not of any greater amount owed by virtue of agreement (contractual severance pay).
For the non-payment of compensation owed for unlawful (exceptional) overtime employment, which is equal to the daily wage paid increased by 120%, criminal liability is provided for the employer or the manager or director responsible for the application of the provisions on working hours, in accordance with Article 7 of Legislative Decree 515/1971 and Article 15 of Legislative Decree 1037/1971.
- See also article Termination of Employment Contract
- See also article Severance Pay
- See also article Modification of Employment Terms
- See also article Withholding of Labour
- See also article Annual Statutory Leave
- See also article Employee Remuneration
- See also article Additional Hours – Overtime
- See also article Employer Obligations
FREQUENTLY ASKED QUESTIONS ON EMPLOYER CRIMINAL LIABILITY
1. A formal complaint has been filed against me for non-payment of wages due — what penalty do I face?
The failure to pay wages due in a timely manner constitutes a self-standing criminal offence under the sole article of Emergency Law 690/1945, as replaced by Article 8 para. 1 of Law 2336/1995, and is punishable by imprisonment of up to six months and a monetary penalty. It is a misdemeanor falling within the jurisdiction of the Single-Member Misdemeanors Court and is prosecuted upon the formal complaint of the employee. In practice, even in the event of conviction, the sentence is generally convertible into a monetary penalty (Article 80 of the Penal Code (PK)) or suspended (Article 99 PK), provided there is no prior conviction. With a sound criminal defence strategy and timely settlement of the debts, any custodial sentence can be avoided.
2. What remuneration does the criminal provision actually cover?
It is critical that the subject of prosecution be narrowly defined, since not every labour claim falls within the criminal provision. Covered are the salary or daily wage, holiday bonuses, the leave allowance, remuneration for additional hours and lawful overtime, as well as compensation for unlawful overtime employment. Law 3996/2011 also added the lawful severance pay. By contrast, wages of mora creditoris are excluded from criminal protection by settled case-law of Areios Pagos, as are benefits in kind that serve the operational needs of the business. Correct legal delimitation may lead to a significant reduction of the charges or even acquittal on certain counts.
3. How do I defend myself — is there a limitation period or a formal defect in the complaint?
The first point of review is the timely lodging of the complaint: if the employee filed the complaint after the lapse of three months from when they became aware of the violation, the criminal prosecution is inadmissible and results in dismissal. Furthermore, the identity and exact timing of the alleged debts are reviewed, along with the standing of the employee, the proper specification of each individual amount, and the eight-year statute of limitations applicable to misdemeanors. Complaints are often vague or mix civil claims with criminally protected items, which opens the door to dismissal or significant reduction of the charges.
4. Can I invoke financial inability or force majeure?
Mere financial difficulty does not negate criminal liability, but genuine and proven inability to pay due to force majeure may exclude intent and lead to acquittal. Elements such as the sudden interruption of financing, the bankruptcy of a key client, destruction of premises, measures by the authorities (lockdown), or unforeseen events substantiate the absence of fault. At the same time, partial or staged payment before trial, participation in conciliation proceedings before the Labour Inspectorate, and the conclusion of a settlement agreement operate as mitigating circumstances (Article 84 PK) and as strong arguments for more lenient treatment.
5. I have been arrested under flagrante delicto — what do I do and how can I avoid imprisonment?
The non-payment of wages due falls within the flagrante delicto procedure, as it is regarded as a continuing offence so long as the debts remain unpaid. Upon arrest, the immediate presence of a lawyer is critical: a deadline can be requested for settlement or restructuring of the debts, an adjournment of the trial may be sought to allow conciliatory resolution to be completed, or defensive pleas may be raised. Pre-trial detention for a misdemeanor of this nature is an exceptional measure and is practically not imposed. In the event of conviction, the sentence is generally converted into a monetary penalty (Article 80 PK) or suspended (Article 99 PK), and there is also the possibility of community service.
6. How does a lawyer help me as an accused employer?
The lawyer assesses from the outset the merits of the complaint, reviews timely lodging, formal defects, and the legal characterisation of the amounts invoked. They develop a defence strategy that may combine an aggressive rebuttal of vague items with a conciliatory approach toward established debts, through payment, restructuring or a record of conciliation before the Labour Inspectorate — procedures that often lead to withdrawal of the complaint or to extinction of criminal liability. The lawyer represents the client at the hearing, raises mitigating circumstances (Article 84 PK), and applies for suspension or conversion of the sentence. The long-standing experience of our firm in criminal matters involving employers ensures effective protection and the avoidance of painful criminal consequences.