Our client, a leading company in the pharmaceutical sector, faced a complex challenge in defending its commitment to ethics and transparency in its operations. This case not only involved a labour dispute that went through multiple judicial instances but also allowed for a significant precedent to be established regarding the proper application of termination with cause in cases of serious misconduct committed by medical sales representatives.
The strategic and thorough defence led by Meythaler & Zambrano not only protected our client's interests but also reinforced legal certainty in the labour field, promoting a solid interpretation of labour regulations in favour of the employer in Ecuador.
Case Context
Our client specialises in the promotion and distribution of medical supplies, and bases its strategy on promotional management through medical sales representatives who interact directly with healthcare professionals. To ensure efficiency and control, they use a technological platform that automatically records and monitors the visits made, guaranteeing transparency and traceability. In this way, our client prioritises strict compliance with its internal policies, promotes its products ethically and effectively, and maintains the trust of healthcare professionals.
In August 2019, one of the employees, a medical sales representative, "GC," recorded visits to four doctors that she had not actually made. This practice is prohibited by the company's Internal Regulations. Therefore, our team of lawyers initiated a termination procedure for serious misconduct, under Article 172 of the Labour Code. After the administrative process, the labour inspector issued a favourable resolution. However, the former employee filed a lawsuit for unfair dismissal, also challenging the termination, which led the case to complex judicial proceedings, resulting in unfavourable decisions in the first and second instances.
Role of Our Team
The legal team at Meythaler & Zambrano played a decisive role at every stage of the process: from representation before the administrative authority for the termination procedure to judicial defence and filing the cassation appeal. Our lawyers demonstrated a deep understanding of the labour and procedural legal framework. The lead lawyers on the team were Atty. Cristina Guarderas, Atty. Carla Caicedo and Dra. Vanesa Aguirre, who led the cassation appeal.
Key Actions
Initial Strategy
We initiated the termination process backed by solid evidence of the breach, which resulted in a favourable resolution for the company, given the seriousness of the offence committed by the former employee.
Judicial Defence
Our team gathered and presented strong evidence to refute the employee's allegations and validate the termination. We appealed the unfavourable decisions of the first and second instances, pointing out errors in assessment and interpretation. We acted swiftly to challenge potential adverse rulings, highlighting deficiencies in judicial reasoning. For instance, although the employee claimed inadequate notification of the termination, the evidence showed that the proper procedure was followed, with notices left at the provided address, in accordance with Article 55 of the General Organic Code of Processes.
The unfavourable decisions in both instances were due to two main factors:
Misinterpretation of the Recurrence Requirement: In the first instance, the judge incorrectly considered that the misconduct needed to be recurrent to justify dismissal through termination. This interpretation does not align with the regulations governing this procedure for serious offences, thus limiting our client's ability to justifiably terminate the employment relationship.
Issue Not Raised Regarding Termination Notification: In the second instance, the appellate court reviewed aspects that were not part of the original dispute, such as how the termination was notified to the former employee. This led the court to exceed its role, improperly affecting our client's situation (reformatio in peius).
Cassation Appeal
Faced with judicial decisions that contained reasoning errors and inconsistencies, our team filed an extraordinary cassation appeal, which allowed the previous rulings to be rectified and a favourable result to be obtained for our client. We developed a strategy based on constitutional doctrine to overturn erroneous decisions that compromised the right to a clear and reasoned judgement, ensuring a fair process in accordance with the law. Throughout the process, we defended the principle of procedural truth and ensured that our client's situation was not aggravated, in compliance with Article 77.14 of the Constitution, thus avoiding «reformatio in peius».
Judicial Achievement and Impact
Thanks to our team's effective strategy in presenting the cassation appeal, the National Court of Justice corrected the previous rulings and issued a favourable resolution for our client.
This ruling not only protected our client's financial interests, exonerating them from paying $13,321.90 for unfair dismissal and severance pay but also set a significant precedent for the company and the pharmaceutical sector, reaffirming justice in labour relations and the validity of termination with cause.
The judgement confirmed the employee's offence and set a precedent for fulfilling the labour responsibilities of medical sales representatives, preventing impunity in cases of internal fraud. The National Court of Justice's decision was notified in writing on 24 September 2024.
This case underscores the need for solid audit and monitoring systems in the pharmaceutical sector to ensure regulatory compliance.
Our intervention in terminating the employment relationship due to report falsification reinforces our commitment to high standards of control and transparency, fostering a culture of compliance and mitigating the risk of future unfounded claims.
Need advice on implementing best labour practices in your company? Contact us today and protect your interests with our specialised legal team.
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