Lending a voice to the silenced – John Katakis v. Maltco Lotteries Limited
AE on Unfair Dismissal – Employment Case Law
Unfair dismissal cases form a large part of employment law cases, but very few of these attract media attention. When the former Chief Executive Officer of Maltco Lotteries Limited found himself summarily dismissed, the unusual circumstances of his sacking raised several eyebrows.
What does the law have to say?
Dismissal and the rights and obligations of both employers and employees are subject to very strict regulation under Maltese law. The Employer may only terminate a contract of employment on the basis of:
- a good and sufficient cause
- redundancy
- retirement ageof the employee
The first reason on the list is that which forms the foundation for most cases which wind up in dispute. Unfortunately, there’s no statutory definition for what constitutesa “good and sufficient cause”. This room for interpretation allows for certain abuse by employers and superiors.
The dispute
John Katakis was employed at Maltco Lotteries Limited in 2001, and appointed Chief Executive Officer in 2005. Mr Katakis was more than just an employee, he was also responsible for the establishment of the company as we know it today, following the privatisation of what was previously the Department of Public Lotto.
Under his tenure, Maltco Lotteries thrived. Shareholders were appeased by regular and generous returns, and there wasn’t a single shift or tremor to indicate that anyone opposed the manner in which Mr Katakis executed his role.
In 2014, it came to his attention that the representatives of one of the minority shareholders sitting on the board also had interests in a casino. This casino was soon to launch a sports book, offering clientele sports betting as a service. At the time, this type of gambling remaining solely within the remit of Maltco Lotteries’s —meaning this external relationship was a clear conflict of interest.
Mr Katakis voiced his concerns and requested that the representatives professionally involved in this casino were removed from the board. To his surprise, the minority shareholder in question reacted poisonously. He retaliated with a strategic vendetta designed to force John Katakis out of the company. First came a refusal to review his employment package, and then an offer to take a similar position in Morocco —which he refused.
In June 2015, the Chairman of the company, Antonios Kerastaris, abruptly announced that an acting CEO was to be appointed in the place of John Katakis. This change was not only put into effect the following day, but John Katakis was not informed. He only learned of the decision by letter in October 2015. This letter, apart from being wholly tardy and unprofessional, also did not contain any logical explanation for his termination of employment.
The solution
It was imperative that John Katakis received not only a favourable ruling, but also proportionate compensation for the appalling treatment he received. Georg Sapiano, founding partner of AE Legal, rarely enters the courts and tribunals these days —dispensing his talents in other areas of the company instead. However, the plight of John Katakis moved him to throw his hat into the ring, together with the support of AE Legal labour law associate, Joseph Grech.
Successful representation comes from not only understanding the struggles of a client, but also genuinely empathising with the injustice. It’s imperative that the decision-maker is moved to understand the unfair treatment of the client through both evidence, and the passion of the legal representation team.
The team at AE Legal knew that John Katakis was treated with the cold disdain. He experienced the blunt aggression that men in power display when they feel the rifle butt of a strong accusation. Our determination stemmed from a desire to demonstrate that no man, no matter his position, is above the law. A lesson that has been forgotten by many today. AE Legal would ascertain that John Katakis’s determination to disallow unethical behaviour would not transform him into a victim.
The result
After hearing both sides, the tribunal ruled that thedismissal of John Katakis wasillegal.It found that the reasons cited by Maltco Lotteries Limited, namely that the CEO and shareholders had developed an unworkable relationship, was an insufficient reason for termination.
The tribunal was chaired by Charles Cassar, who stated that he could see no evidence that Mr Katakis’s sacking had any connection whatsoever to his work or professional performance. Instead it came down to a breakdown in the relationship with the company’s minority shareholders. This is itself was not a legal basis to merit termination of employment.
The tribunal ordered Maltco Lotteries Limited to pay John Katakis €83,125 in compensation and damages. The result of this dispute is not only a victory for John Katakis, but also for professional morality. It demonstrates that a single entity can wield enough power to rise up against the unethical actions of giants.
