Termination of employment

Grounds for termination

May an employer dismiss an employee for any reason or must there be ‘cause’? How is cause defined under the applicable statute or regulation?

An employment relationship may be terminated by the employer in writing:

  • with a notice period; or
  • without a notice period (ie, with immediate effect).

 

In both cases, a cause is needed.

In the case of termination with a notice period, such a cause must be in connection with the employee’s behaviour concerning the employment relationship, the employee’s ability or the employer’s operations. In the case of dismissal without a notice period, there must be a more serious cause. The employer may exercise such a right if the employee wilfully or by gross negligence gravely violates any substantive obligation arising from the employment relationship, or otherwise acts in a way that renders the employment relationship impossible.

Notice

Must notice of termination be given prior to dismissal? May an employer provide pay in lieu of notice?

In the case of termination by notice, a certain notice period must be given before dismissal. Such a notice period is 30 days, which increases based on the time spent in employment. The notice period starts on the day after the written notice has been handed to the employee. The employer may (to some extent, must) release the employee from work duty for the term of the notice period (in which case, the employee is entitled to absentee pay). However, even in that case, there must be a notice period, and the employer may not replace the notice period with payment.

In which circumstances may an employer dismiss an employee without notice or payment in lieu of notice?

The employer may dismiss the employee without a notice period (ie, with immediate effect) if the employee wilfully or by gross negligence gravely violates any substantive obligation arising from the employment relationship, or otherwise acts in a way that renders the employment relationship impossible. In this case, there is no notice period and the employment relationship ends on the day when the dismissal without notice is handed over to the employee. The right of dismissal without notice period may be exercised within 15 days of learning the reasons on which the dismissal without a notice period is based but in no case after one year of the occurrence of the events serving as grounds for the termination.

In the case of termination with a notice period, the notice period is compulsory and the employer does not have the right to pay in lieu of notice.

Severance pay

Is there any legislation establishing the right to severance pay upon termination of employment? How is severance pay calculated?

The employee is entitled to severance pay if the employment relationship is terminated:

  • by the employer;
  • due to dissolution of the employer without succession; or
  • by the employee, if the termination is validly connected with the transfer of undertaking.

 

Even in these cases, the employee is not entitled to severance pay if:

  • he or she is recognised as a pensioner at the time the termination notice is delivered or at the time the employer is terminated without succession; or
  • he or she is dismissed for reasons in connection with his or her behaviour concerning the employment relationship or on grounds other than health reasons.

 

The severance pay is one month’s absentee pay if the employee has spent at least three years in employment with the specific employer. This amount gradually increases based on the time spent in employment. The amount of the severance pay is increased by one to three months’ absentee pay if the employment relationship is terminated within the five-year period before the date when the employee reaches the pensionable age limit.

Procedure

Are there any procedural requirements for dismissing an employee?

The prior consent of the higher-ranking trade union body is required for terminating with notice the employment relationship of a trade union official. Trade union officials have this protection during their term in office and for a period of six months thereafter, provided that they have held the office for at least 12 months. The trade union may communicate its written opinion within eight days of receipt of the employer’s notice. If the trade union misses this deadline, this is to be construed as an agreement with the proposed action.

Employee protections

In what circumstances are employees protected from dismissal?

In the case of termination by a notice period, the employees are protected from dismissal during:

  • pregnancy;
  • maternity leave;
  • leave of absence taken without pay for caring for a child;
  • any period of actual voluntary reserve military service, and if the employee is a woman; and
  • while receiving treatment related to a human reproduction procedure, for up to six months from the beginning of such treatment.

 

In the case of dismissal without a notice period, there are no special circumstances protecting employees from dismissal.

Mass terminations and collective dismissals

Are there special rules for mass terminations or collective dismissals?

There are special rules for mass terminations in the Labour Code. If the employer plans mass terminations, it must initiate consultations with the work council and notify in writing the government employment agency as well. Even the employees subject to mass termination are to be informed in writing of the decision at least 30 days before delivering the notice of dismissal.

Class and collective actions

Are class or collective actions allowed or may employees only assert labour and employment claims on an individual basis?

There are collective actions allowed in employment litigations in the framework, of which at least 10 employees must jointly file a claim based on the same right.

Mandatory retirement age

Does the law in your jurisdiction allow employers to impose a mandatory retirement age? If so, at what age and under what limitations?

Employers do not have the right to impose a mandatory retirement age.