Judicial remuneration freeze do not comply with the Satversme
The Constitutional Court has adopted a judgment in the case wherein it assessed the freezing of judicial remuneration (case No. 2009-11-01 “Compliance of the Second Sentence of Para 7 and Para 17 of the Transitional Provisions of the Law “On Judicial Power” (wording of 14 November 2008) with Article 1, Article 83 and Article 107 of the Satversme (Constitution) of the Republic of Latvia”).
The applicants – more than one hundred judges of Latvia – hold that the contested norms infringe, among the rest things, the principle of legal certainty, the principle of legal stability and the principle of independence of the judiciary.
The Constitutional Court, taking into consideration the peculiar nature of the issue, first investigated whether it has the right to examine the matter under review. The Court established that the Constitutional Court acts as a supreme guardian of the Constitution. If legal norms or activities of the executive power infringe interests of a person, these should be controlled by the judicial power.
The Constitutional Court concluded that, when adopting the contested norms, the principle of separation of powers has been violated. The legislature has not taken into consideration the opinion of the judiciary. Taking into account the reference to possible infringement of the Constitution included in the annotation of the Draft Law and mentioned in the opinion of the Saeima Legal Bureau, neither has the legislatore assessed risks and negative consequences caused by the contested norms.
When assessing influence of the contested norms on the independence of judges and the judiciary, the Constitutional Court has indicated that independence of judges and the judiciary is an obligatory precondition for the exercise of the right of each person to a fair trial, rather than an end in itself. Independence of judges guarantees ensuring lawfulness in the interests of the society and the state.
The independence of judges is related with several guarantees, for instance, security of tenure, immunity of judges, financial security, independence of the judicial power from political influence of the executive power of the legislature. All guarantees are mutually related. In case if any of the guarantees is being restricted in a non-proportionate manner, the principle of the independence of judges is violated; this consequently threatens fulfilling the basic functions of the court and ensuring human rights and freedoms. The requirement to ensure a judge with a sufficient remuneration is related not only with the principle of the independence of judges but also the requirements set forth for judges regarding their qualification and proficiency, and the restrictions established in connection with their income. The decision of the legislator to reduce salaries of judges might jeopardize the independence of the judiciary.
The Constitutional Court has also established that judges do not live in a social vacuum and they are also affected by the present situation in the State, whatever has caused it – a natural disaster, economic recession, actions or inactivity of the government or irresponsible decisions. Therefore the prohibition to reduce remuneration of judges may not be absolute.
The Constitutional Court has drawn attention to the criteria that should be observed when reducing remuneration of judges, namely, it is possible to reduce remuneration of judges only by law, in exceptional cases, and the reduction may take effect only for a short term, namely, as long as the financial and economical situation of the State remains difficult. Moreover, according to the principle of separation of powers, it is necessary to hear and respect the opinion of the judicial power. If the opinion of the judicial power is not taken into consideration or it is only partially considered, such action must be substantiated.
The Court recognized that the contested norm has a legitimate objective, namely, ensuring of welfare of the society. The decision of the legislator to reduce remuneration of judges due to the lack of resources during the economic recession, this reduction being effected simultaneously with the reduction of salaries of all persons paid from the public purse, can be justified.
The system of remuneration of judges in Latvia has been elaborated in a way to avoid, as far as possible, the necessity to amend it. The amount of the basic wage of a judge reflects the trends of remuneration in Latvia in general. During the economic growth, remuneration of judges increases as the average wage in the State grows, which helps preserving the actual value of the salary. During the economic recession, however, remuneration of judges is automatically reduced. Consequently, it would not be fair to permit a double cut of remuneration of judges, the first being carried out along with the reduction of remuneration of employees in the public sector and the second – based on the reduction of the average monthly wage in the State. It can be concluded that automatic reduction of remuneration due to the specific character of the system takes place with a certain delay in time; however increase takes place with a certain delay as well.
The Constitutional Court has also concluded that the principle of solidarity has neither been observed when providing for the reduction of judicial remuneration.
The contested norms thus provide for such wage of judges in 2009 that is equal with the wages in 2007 rather than those in 2008. Consequently, the remuneration was, in fact, reduced.
As to members of the Saeima (Parliament) and the Cabinet of Ministers, remuneration in 2008 was recalculated. Wages of higher public officials in 2008 were increased by 17 to 19 percent, whilst wages of directors of independent institutions – by 20 percent. The average monthly wage of directors of legal departments of the ministries in the first six months of the year exceeded the average monthly wage of 2008 by 6.4 percent. The monthly wage of State secretaries of the ministries was increased by 3.4 percent. In certain ministries, the monthly wage of State secretaries was increased even in April 2009. For instance, in the Ministry of Finance – by 35 percent, and the Ministry of Health – by 30 percent. Remuneration of separate officials employed in State administration institutions in 2007 and 2008 exceeded remuneration of judges even by 5.5 times and that of a judge of Land Registry – tenfold.
Consequently, the Constitutional Court has recognized the contested norms as non-compliant with the Satversme. The Court has taken into account, however, that an immediate enforcement of the judgment could cause negative consequences for the State budget. Even more negative consequences would occur if these norms were declared void as from the date of coming into force, namely, 1 January 2009. Therefore, having assessed the circumstances of the case, the Court established that the contested norms shall become void as from 1 January 2011.
The Judgment of the Constitutional Court is final and not subject to appeal. It shall come into force as on the date of publishing it in the newspaper “Latvijas Vēstnesis”.
Linked case: 2009-11-01