Introduction

Crucial elements of internal justice systems put in place by international organisations: the administrative tribunals. Unlike their name may indicate, their primary task is not to offer redress against acts of international organisations exercising public power over third parties. Rather than that, they focus on hearing and settling disputes between international organisations and their (former) members of staff, or their successors.

This contribution looks at the powers of the administrative tribunals from various angles, including their power to annul the contested decision and their corresponding leeway, the power to order other measures, and finally something we call a “price tag” scheme. Rather than offering an exhaustive comparative analysis, we wish to present the reader with some interesting takeaways. We primarily looked at the ‘proper’ administrative tribunals and refer below, often by way of example, to the law of the administrative tribunals of the Asian Development Bank (ADBAT), the Council of Europe (CoEAT), the Intern-American Development Bank (IDBAT), the International Labour Organization (ILOAT), the International Monetary Fund (IMFAT), the Organisation for Economic Co-operation and Development (OECDAT), the OPEC Fund for International Development (OPEC Fund AT), the Organization of American States (TRIBAD), and the World Bank (WBAT), as well as of the Independent Employment Tribunal of the Square Kilometre Array Observatory (SKAOIET). We also included some comparison with the Court of Justice of the European Union (CJEU), which, through the General Court, hears and determines staff disputes, namely between the EU institutions, organs, bodies and agencies and their staff.

Power to annul

Let us start with the power of the administrative tribunals to annul the contested decisions as such, however self-evident that may appear. It is interesting to see to what extent the legal framework of the administrative tribunals establishes such power and, by contrast, whether and how it has developed through their decision-making practice. It is true that, as a matter of principle, the administrative tribunals do set aside the contested decisions. The language they use varies; while some tribunals set aside, others quash, rescind, annul or declare null and void. They usually have in their legal framework a corresponding legal basis. However, the reality sometimes slightly shifts away from the exact wording of law.

In some cases, the text clearly empowers the tribunal to annul the contested decision. This is the case for instance for the SKAOIET. Its Rule 7.5 explicitly allows it to ‘annul the decision’ concerned. Similarly, the laws of the TRIBAD and OECDAT explicitly mention the power to annul the contested decisions. Interestingly, the fact that the OECDAT may annul the contested decision follows only indirectly from a provision of its Statute addressing a different question (Article 12[c] OECD AT Statute; see below). The CJEU is a case of its own. Its annulment power is explicitly embedded in its legal framework, as it may ‘declare the act concerned to be void’ (Article 264 Treaty on the Functioning of the EU [TFEU]). However, in practice, it has used much clearer wording, and it ‘annuls’ the contested acts to the extent it finds the action for annulment well-founded (for instance in C‑40/10 Commission/Council).

Sometimes though, the administrative tribunals annul the contested decisions although the applicable provisions of their legal framework read slightly differently. For instance, if the IMFAT concludes that an application challenging the legal­ity of an individual decision is well-founded, it is obliged, as per the text, to ‘prescribe the rescission‘ of such a decision (Article XIV[1] IMFAT Statute). The IMFAT should thus only order that the contested decision must be rescinded. In other words, the IMFAT’s decision would oblige the IMF as the defendant organisation to do so, but the rescission would still happen through an act of the IMF as the originator of the contested decision. That said, IMFAT’s case law clearly shows that IMFAT rescinds the contested decisions itself (for instance Judgment 2024-1 WW/IMF). The dissonance between the text of the rules and the actual practice is reinforced by the wording of the parallel provision for regulatory decisions. It follows therefrom that if the tribunal concludes that an application is well-founded, ‘it shall annul such deci­sion’. Similar discrepancies between the law and practice as in case of the IMFAT exist for instance in case of the WBAT (Article XII[1] WBAT Statute v. Decision 686/2023 GW/IFC), the ADBAT (Article X[1] ADBAT Statute v. Decision No. 115 Cruz/ADB) and IDBAT (Article IX[1] IDBAT Statute v. Case No. 102 Parrales/IDB).

More broadly on the annulment

The second set of findings revolves more broadly around various aspects related to the issue of annulment of the contested decisions by the administrative tribunals.

Wrong, but stays

First, some administrative tribunals may decide not to annul the contested decision despite finding the appeal well-founded and hence the contested decision illegal. Instead, they may order other consequences upon the defendant organisation. The defendant organisation is hence given the opportunity to convince the respective administrative tribunal that the annulment is not the right way forward, before the latter concludes the case. It is a way of addressing possible negative and undesirable impact of an annulment on the defendant organisation. Pursuant to Article XII(1) WBAT Statute, if the WBAT finds the application well-founded, it either orders the rescission of the contested decision or the specific performance of the obligation invoked, unless it finds that the defendant institution has reasonably determined that such rescission or specific performance would not be practicable or in the institution’s interest. If that is the case, the WBAT orders such institution to pay restitution in the amount that is reasonably necessary to compensate the applicant for the actual damages suffered. The Statute of the ILOAT includes similar rule in its Article VIII. The powers of the CJEU are constructed differently, although they are similar in outcome. The CJEU always annuls the contested act to the extent it is illegal, but it may, if it considers it necessary, state which of the effects of such act shall be considered as definitive (Article 264 TFEU). In other words, it can declare certain aspects of the contested act operative in the interests of legal certainty (for example C-21/94 European Parliament/Council [31]) or the need to suspend the effects of annulment until a competent institution replaces the annulled act with a new one (for example C‑40/10 Commission/Council [95]).

Annulled. Then what?

Second, if administrative tribunals decide to annul a contested decision, they usually also decide on consequences of such an annulment. In other words, they order the defendant organisation what it needs to do to correct the effects of the successfully contested decision, including payment of compensation or sometimes even specific performance, such as for instance the reinstatement of the appellant. However, the SKAOIET and the CoEAT are not endowed with the power to order specific performance: they defer to the defendant institutions on the implementation of decisions, although they can order compensation. Moreover, the CJEU has constantly rejected its power to issue directions to the defendant EU entities. That said, it has not shied away from ordering them to pay compensation (for instance T-370/20 KL/EIB [109, 111]).

Price tag

Third, instead of taking the measures, which the annulment of a contested decision by the tribunal implies or which the tribunal even prescribed, some defendant organisations may opt for an in lieu compensation. One could also call it a “price tag”. Those organisations may do so if they consider that the judgment is not in the interest of the organisation (see for example, IDBAT: Article IX of Statute, ADBAT: Article X(1) of Statute, CoE AT: Article XVI of Statute). In other words, the rules explicitly allow those organisations to disregard the annulment and its consequences. As a substitute, they may decide to pay. That is another way of addressing possible negative and undesirable impact of an annulment on the defendant organisation. The EU law does not foresee such an option, hence any comparison with the CJEU is irrelevant here.

The tribunal determines the level of such an in lieu compensation, be it subsequently or even before the defendant organisation has taken such decision. Dependant on that, one can distinguish one-step from two-step price tag schemes. The IMFAT Statute follows the one-step approach. Article XIV(2) IMFAT Statute foresees that the IMFAT fixes the price tag at the same time as it orders in its judgment for the IMF to take any non‑pecuniary measures. The price tag is thus put on top of any potential compensation (pecuniary measures) already awarded. The IMF Managing Director is then given one month time from the judgment’s notification to decide whether to implement such measures. The provision makes clear that a decision not to do so should be driven by the ‘interest of the Fund’. We have not found an application of this provision in practice as relatively few claimants ask for reinstatement, and we have found none who have succeeded or received compensation instead pursuant to this provision. The ADB (Article X(1) ADBAT Statute), the OPEC Fund (Article XI(11.3) of the OPEC Fund AT Statute) and Organization of American States (Article IX(2) of TRIBAD Statute) have also put in place one-step price tag schemes. Interestingly, in the case of TRIBAD, the successful appellant may also opt for the price tag, if the defendant entity does not do so within the time limit foreseen. By contrast, the IDBAT Statute provides for a two-step model. Pursuant to Article IX(3) of the IDBAT Statute, the decision to reject the rescission or specific performance ordered lies with the executive head of the defendant entity. Following such rejecting decision, the executive head needs to petition the tribunal in writing, which then fixes the price tag. Here again, the price tag is put on top of any other compensation awarded and the rejecting decision should result from the fact that the rescission or specific performance ordered is not practicable or in the best interest of the defendant entity. The legal frameworks of the OECDAT (Article 12(c) OECDAT Statute) and the IDBAT (Article IX(3) IDBAT Statute) foresee similar two‑step price tag models.

When determining the price tag, the tribunals may be constrained by a “cap” – an upper limit of the amount the tribunal can fix. The rules can differ from each other as to how high the cap is set, as well as whether and how much the tribunals can exceed it. It can be demonstrated on three different examples. First, the IMFAT is limited by a cap of appellant’s three annual salaries. It may, however, in exceptional cases, order the payment of higher compensation, which it needs to justify in its decision (Article XIV(3) IMFAT Statute). Similar rules apply to the ADBAT (essentially same limit and exceeding power; Article X(1) ADBAT Statute) and to the CoEAT (only two years basic limit, but same unlimited exceeding power in exceptional cases; Article XVI(2) CoEAT Statute). Second, the TRIBAD is bound by a limit of appellant’s two annual salaries. The power to exceed such limit resembles the one granted to the IMFAT, the ADBAT or the CoEAT, with the exception that it is limited by the amount of one further appellant’s annual salary (Article IX.2 TRIBAD Statute). Third, the OPEC Fund AT must respect a cap of appellant’s two annual salaries. The rule does not foresee that it could exceed such a cap (Article XI(11.3) OPEC Fund AT Statute).

Conclusion

The administrative tribunals of international organisations have been endowed with various powers of redress. There is neither a silver bullet, nor a one-size-fits-all solution. At the same time, inspiration and “cross-fertilisation” between the various administrative tribunals can hardly be denied. Further to that, even if sometimes the schemes put in place differ from each other, in practice, they often resemble in outcomes. Finally, some of the concepts differ significantly from what has been put in place for or by the CJEU, which needs to be kept in mind, as it for instance means that the applicants must plead their cases differently depending on the forum.

Posted by Iona Luca and Michal Kianička

Ioana is a senior legal counsel at the International Monetary Fund. In 2023 and 2024, she was seconded to the European Stability Mechanism for one year.

Michal has been working as a senior legal counsel for institutional affairs at the European Stability Mechanism since 2021. Before that, he was member of the Slovak EU litigation team between 2010 and 2020.