Are employers required to give notice of termination?

Angola
Miranda & Associados

In general, termination by serving a notice period is not allowed. However, for fixed-term employment contracts the employer must serve the employee with prior written notice of two weeks before the contract expires.

Armenia
ELL Partnership LLC

An employer must give notice of termination in the following cases:

  • Where the company is liquidated, the employer should give written notice to the employee no later than two months before liquidation. The same requirement applies in the event of changes in production volumes, economic or technological changes, changes in working conditions and/or redundancies due to industrial necessity.
  • The employer must give notice where the essential working conditions have changed, the employee is no longer suitable for the position or the work or the employee has a longā€term inability to work (if he or she does not come to work for more than 120 successive days or no more than 140 days within a 12-month period because of a temporary inability to work, if the law and other normative acts does not provide that the job and title be preserved for a longer term in case of certain diseases).
  • Where the employee reaches retirement age (unless otherwise specified in the employment agreement), the employer must give notice of termination no later than:
    • 14 days before termination to employees with up to one year’s service;
    • 35 days before termination to employees with between one and five years’ service;
    • 42 days before termination to employees with between five and 10 years’ service;
    • 49 days before termination to employees with between 10 and 15 years’ service; and
    • 60 days before termination to employees with more than 15 years’ service.

Austria
Graf & Pitkowitz

Employers must observe contractual notice terms or, in the absence of agreed notice terms, the default notice regulations implied by law (or the relevant collective bargaining agreement). The minimum notice period is six weeks. The notice period increases in tandem with seniority, up to five months after 25 years of service.

Belgium
Van Bael & Bellis

There are several ways to terminate an employment contract. It may come to an end by mutual agreement between the employer and the employee at any time (eg, during the notice period or when the contract is suspended), either with immediate effect or at a later date. Such termination is subject to no formalities. The employer may not exert pressure on the employee to agree to termination. Mutual termination of the employment agreement does not give rise to the payment of an indemnity. However, the employer is free to pay compensation.

The employment agreement may also come to an end at its expiration if the contract is for a fixed period or for a specific task. It may also be automatically terminated if either party cannot perform its obligations under the employment contract and the cause of such non-performance is permanent.

An employer dismissing an employee may either give him or her notice of termination (during which period the employee must continue to work) or terminate the contract immediately by paying a severance indemnity in lieu of notice. The employer may terminate the contract during the notice period by paying an indemnity equal to the salary which the employee would have received for the remainder of the notice period. An employee who resigns must also give notice to the employer or pay an indemnity in lieu of notice.

An indemnity in lieu of notice is due when the employer or employee terminates the employment contract without notice or with insufficient notice. At any time during the notice period, the terminating party may decide to pay an indemnity in lieu of notice.

An employment agreement can also be deemed to be terminated due to the unilateral modification of one of its essential elements.

Canada
Miller Thomson LLP

The Canada Labour Code provides that employers must provide at least two weeks’ notice or pay in lieu of notice to employees with more than three months of employment, unless the employer has just cause. Severance pay is also required for employees with more than one year of service. Severance pay is calculated on the basis of two days’ pay per year of service, with a minimum of five days’ pay. In addition, common law principles apply. Employees may be entitled, at common law, to reasonable notice or compensation in lieu of notice which may significantly exceed their minimum statutory entitlements. For these purposes, reasonable notice is determined based on service, age, character of employment and the availability of alternative employment. The employer and employee may agree, by written contract, to an express termination provision, as long as it is not less than the statutory minimum requirements.

France
Seyfarth Shaw LLP

All termination notices must be in writing. The termination process is strictly regulated under French law and termination letters must explain the grounds for termination and contain certain mandatory information. 

Germany
Vangard

Yes, the employer must give notice of termination. Any notice of termination must be in writing. Otherwise, the termination is null and void. Notification by email, fax or text message will not suffice.

Depending on the employee’s years of service, notice of termination must be given well in advance. The basic notice period, applicable for the first two years of employment, is four weeks either to the 15th of a calendar month or to the end of a calendar month. Thereafter, the notice period increases from one month to the end of a calendar month to a maximum of seven months to the end of a calendar month for employees with 20 or more years of service. 

Iceland
Logos Legal Services

Employees are entitled to a statutory minimum notice period according to the Act Respecting Labourers’ Right to Advance Notice of Termination of Employment and Wages on Account of Absence through Illness and Accidents (19/1979). The act establishes the following minimum rights: 

  • after one year of continuous employment with the same employer – one month's notice;
  • after three years of continuous employment with the same employer – two months' notice; and
  • after five years of continuous employment with the same employer – three months' notice.

An employee who is entitled to one of the above notice periods must give the same notice if he or she wants to terminate his or her employment.

Collective agreements contain provisions on notice periods which are applicable during and after the first year of employment. The length of an employee’s notice period varies between collective agreements, but is usually three months for long-term employment.

Employers must respect the rules on notice of termination, unless the employee has, by intent or gross negligence, seriously violated the employment contract. Serious violations can justify rescission of the employment contract. 

Employees who are deprived of their right to notice of termination can claim damages equivalent to his or her loss during the notice period. 

India
Kochhar & Co

In the case of ‘workmen’ (as defined in the Industrial Disputes Act, 1947), employers must give 30 days’ notice for termination for convenience. In the case of other employees, most states also provide for 30 days’ notice for termination for convenience. 

Israel
Barnea & Co

The Advance Notice for Dismissal and Resignation Law requires both employers and employees to give notice. The length of the notice period is set according to the duration of employment, with a maximum of 30 calendar days. An employer can forgo the attendance of the employee during the notice period, provided that it pays the employee in lieu of notice.

Japan
Iwata Godo

There is a minimum 30-day notice period before an employer can dismiss an employee. If the employer does not wish the employee to work any part of this notice period, it can pay his or her salary in lieu of notice. Although this procedure is cumbersome and seldom applied in practice, no notice is required where the employer summarily dismisses the employee for serious misconduct, as long as it has obtained the local Labour Standards Inspection Office’s consent.

Employers may terminate an employment contract for just cause only. Dismissed employees can claim reinstatement and salary based on the invalidity of the dismissal or compensation for unfair dismissal, unless the employer can show that there was a serious and objective reason for dismissal (eg, misconduct, incapacity, illegality, redundancy or some other substantial reason). The misconduct or breach of law must be serious in order to meet the stringent Japanese court standards. Unless the employer’s case is strong (including its evidence), a customary and safer alternative to dismissal is for the employer to request that the employee resign. Resignation offers are made on an individual basis and employees need not accept them. Financial incentives are normally offered in order to encourage employees to accept resignation offers. The arrangement can be documented in a separation agreement covering the separation package, waivers and releases and restrictive covenants.

Luxembourg
Loyens & Loeff

On termination, employees are entitled to a notice period calculated according to their length of service within the company. Unless the employer and employee have agreed otherwise in the employment contract, notice periods are calculated as follows:

  • less than five years of employment – two months;
  • between five and 10 years of employment – four months; and
  • over 10 years of employment – six months.

Employees dismissed for gross misconduct are not granted a notice period.

Mozambique
Miranda & Associados

Pursuant to the Labour Law, an employment contract may cease only by:

  • expiry;
  • mutual agreement;
  • termination by the employee, with or without cause; or
  • termination with cause by the employer.

Therefore, there is no at-will termination by serving an employee with a notice period.

However, in relation to a fixed-term employment contract, the employer should serve the employee with prior written notice before the contract expires, under penalty of the same being automatically renewed for an equal period or converted into an indefinite employment contract. Prior notice of termination is also required in the context of dismissals for technological, structural or market-related reasons that are essential to the competiveness, economic restructuring or administrative or productive reorganisation of the company (redundancy procedures).

Netherlands
Shearwaters

Yes. The Dutch dismissal rules are described in detail below, given their specific nature and complexity compared to comparable laws in other jurisdictions.

At the end of 2012, the Dutch government and Dutch social partners (trade unions and employers’ associations) agreed several major changes to employment/dismissal laws. The Employment and Security Act is being implemented in three phases: on January 1 2015, July 1 2015 and January 1 2016. The changes effective from the first two dates are described below. New rules are also being introduced in 2016 to relax the protection of employees who continue working beyond pensionable age.

Among other things, since 2015 employers can no longer choose to dismiss employees on indefinite employment agreements either through court proceedings or through a dismissal permit; appeal (to the high court and the Supreme Court) is now possible in all dismissal cases. As a rule, dismissed employees are also legally entitled to a ‘transitional allowance’ (which can be regarded as constituting a statutory entitlement to a severance payment).

Termination of fixed-term employment agreements on the expiry of the agreed term is thus fairly straightforward, but the new legislation has also introduced several relevant changes in this respect. For example the use of trial periods and the use of non-compete clauses in fixed-term contracts has been restricted, and employers are now obliged to notify the employee in a timely fashion as to whether the contract wull be renewed. In addition, the use of successive fixed-term contracts has been restricted further: fixed-term contracts will become indefinite either after two years of using fixed-term contracts or as soon as a fourth contract is agreed. The only way to prevent fixed-term contracts from becoming permanent contracts is to maintain a mandatory ‘non-use’ period of at least six months between two fixed-term contracts.

Under the new rules, an indefinite employment agreement can be terminated by employers in the following ways:

  • mutual consent confirmed in a written termination agreement;
  • court order (rescission);
  • notice of termination without the employee’s consent and after having obtained a permit to give such notice; or
  • summary/instant dismissal in case of an urgent reason (eg, theft or fraud).

Termination by mutual consent
The employer and employee are free to reach an amicable settlement at any time, which is then laid down in a settlement agreement between the parties. This will confirm that the employment agreement is terminated by mutual consent with effect from a certain date and on the initiative of the employer, in order to safeguard social security entitlements for the employee (if any) insofar as possible.

A settlement agreement usually includes a number of issues in addition to a specific termination date and severance payment, such as bonus entitlement, holiday entitlement and garden leave.

In practice, employers usually offer a settlement agreement before unilateral dismissal (eg, rescission by court order) is pursued. Should the parties fail to reach agreement, a settlement agreement can also be reached at a later stage (eg, at the time of a court hearing).

As from July 1 2015, an employee who has entered into a settlement agreement can revoke his or her consent to that agreement during a mandatory two-week cooling-off period. The employer must notify him or her of this right in advance. Failure to do so results in extension of the cooling-off period to three weeks.

Rescission by court order
The employer may request a court to rescind the employment agreement where a reasonable ground for termination applies.

Performance-related issues (eg, underperformance) constitute reasonable grounds for termination. Dutch law now states explicitly that the employer must first have given the employee timely notice of such underperformance and sufficient opportunity to improve his or her performance.

In the rescission request, the employer must set out its case for dismissal. The employee will be given the opportunity to defend himself or herself, both in writing and during the court session.

The court may refuse to rescind the employment agreement if it is not convinced of the employer’s case (eg, if the employee has not been given a genuine chance to improve his or her performance). Should the court honour the request (usually within eight weeks of the request being filed), it will determine a termination date and a transitional allowance (see below). In light of EU Regulation 44/2001, an employer cannot request a Dutch court to rescind the employment agreement if the employee lives abroad.

The employee can also request rescission of the employment agreement, although such requests are fairly uncommon.

Termination by giving notice with dismissal permit
The employer may request a dismissal permit from the semi-governmental Employee Insurance Schemes Implementing Body (UWV) either for economic reasons or following two years of continued illness.

As in the court route described above, the employer must set out its case for dismissal, and the employee will be given ample opportunity to submit a defence (in writing, in principle, without a hearing).

As in the court route, the UWV may refuse to grant a dismissal permit if it is not convinced of the employer’s case. This decision can be appealed before the court; likewise, if the UWV grants the requested dismissal permit, the employee can appeal to the court in an effort to restore the employment agreement. Both court decisions are subject to further appeal.

Only if the UWV honours the request for a dismissal permit (usually within eight weeks of the permit request being filed), the employer can give notice to the employee. The termination date depends on the applicable notice period (if this employer does not intend to observe this, payment in lieu is required). The time spent on the UWV proceedings may be deducted from the notice period, provided that the remaining notice period will equal at least one month.

Prohibitions against giving notice may apply which could potentially prevent the use of a successfully obtained dismissal permit. Such prohibitions apply, for example, to pregnant employees, ill employees during the first two years of illness, employees in military service and employees who are members of a works council.

Financial compensation in case of dismissals under Dutch law
With effect from July 1 2015, dismissed employees may be eligible for two types of financial compensation under Dutch law (in addition to compensation if the notice period is not observed).

A statutory transitional allowance (a statutory severance payment) was introduced into Dutch law for the first time on July 1 2015. The employer must pay the transitional allowance to the employee if:

  • the employer has given notice of termination (with or without the employee’s consent);
  • the employment agreement has been rescinded by the court at the employer’s request;
  • a fixed-term contract has not been renewed at the initiative of the employer; or
  • the employee has taken the initiative for the termination (eg, by requesting rescission or giving notice of termination) due to serious misconduct by the employer (eg, sexual harassment, discrimination).

The transitional allowance is calculated as follows in relation to employees below the age of 50:

  • one-sixth of the employee’s monthly salary for every six months of service for the first 10 years of service (ie, one-third of the employee’s salary for every full year of service for the first 10 years); and
  • one-quarter of the employee’s monthly salary for every six months thereafter (ie, one-half of the employee’s monthly salary for every full year of service thereafter).

For employees aged 50 and above with 10 or more years of service, every six months of service after the age of 50 counts for one-half of the employee’s monthly salary (ie, a full month for every full service year thereafter); these employees are thus eligible for a higher transitional allowance compared to their younger colleagues or colleagues with under 10 years of service.

The transitional allowance is paid only to employees (aged 18 or over) who have been employed by the employer for at least two years. It is capped at €75,000 gross or one year’s salary, whichever is greater.

Several exceptions apply, including in relation to small companies (ie, with fewer than 25 employees) in specific circumstances and companies in financial difficulties. In addition, the transitional allowance need not be paid if the employee can be seriously blamed for the dismissal.

The court may also award an employee an additional financial compensation at its discretion, but only under very specific and exceptional circumstances – essentially, in case of gross misconduct by the employer, such as sexual harassment or discrimination.

Summary dismissal
Either party to the employment agreement may face circumstances in which the employment relationship could not reasonably be expected to continue (‘urgent reasons’). If these circumstances are the fault of the employee, the employer can terminate the employment agreement with immediate effect. Likewise, if these circumstances are the fault of the employer, the employee can terminate the employment agreement with immediate effect.

Dutch law sets forth a number of examples of ‘urgent reasons’, such as gross negligence in the performance of duties, disclosure of trade or professional secrets, theft, fraud, embezzlement or (other) crimes involving breach of trust. However, only the competent court can determine whether the facts of any given case constitute urgent reasons justifying immediate termination.

Saudi Arabia
Clyde & Co LLP

If the employment contract is for an unlimited term, either party may terminate it for a valid reason by serving on the other party no less than:

  • 30 days' written notice if the worker is paid monthly; or
  • 15 days’ written notice for other workers (or the period specified in the contract, if different).

Failure to give adequate notice entitles the other party to compensation equivalent to the notice period required or remaining (as the case may be).

The Labour Law also lists specific circumstances in which the employer or employee may terminate employment without notice.

An employee on an indefinite term contract is also entitled to written reasons for termination of employment.

Switzerland
Pestalozzi Attorneys at Law Ltd

Employers must respect the applicable statutory notice periods of one, two or three months, depending on the employee’s years of service. The employer and employee may agree, in writing, on shorter or longer notice periods. However, the employer and employee cannot agree on a notice period of less than one month.

United Kingdom
Mayer Brown LLP

Employers must provide notice of termination. The required notice period is usually set out as an express term in the employment contract; however, where no written employment contract or express term dealing with notice in the written contract exists, there will be an implied term to give reasonable notice.

Employees are entitled to a statutory minimum notice period of one week after they have been employed for more than one month but less than two years. After two years of employment, employees are entitled to an additional week's notice for each complete year of service, up to a maximum of 12 weeks.

Where the contractual notice period exceeds the statutory minimum, the contractual period will prevail.

USA
Ogletree Deakins

Outside the context of plant closures and mass layoffs, employers in the United States are not required to provide employees with notice of termination.

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