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Termination

Notice

Are employers required to give notice of termination?

Yes, employers must give notice of termination in writing. 

Redundancies

What are the rules that govern redundancy procedures?

Employers must provide a written statement on a termination notice. A termination notice for an indefinite term employment agreement must provide grounds that justify the termination. Employment agreements concluded for a trial or definite period are exempt from this requirement.

Where an employer terminates an employment agreement without giving notice, it must indicate its reasons for doing so in the statement on the termination notice.

In case of termination of an indefinite term employment agreement with notice or termination of an employment agreement without notice where the employee is a member of a trade union or has applied to the trade union to defend their rights, the employer must notify the trade union of its intention to terminate the employment agreement.

Are there particular rules for collective redundancies/mass layoffs?

Yes, the Act on Special Principles for Termination of Employment Relationships with Employees for Reasons Not Relating to Employees provides for a special procedure to be followed where an employer needs to dismiss multiple employees. This procedure applies to employers of at least 20 employees. However, whether it need be applied is determined by the limits of acceptable dismissals, which depend on the number of employees. For example, the procedure must be applied if the following limits are met in a 30-day period:

  • an employer with less than 100 employees intends to terminate 10 or more employees;
  • an employer with between 100 and 300 employees intends to terminate 10% of employees or above; or
  • an employer with 300 or more employees intends to terminate 30 or more employees.

Under this procedure, employers must:

  • inform the relevant state institution employment offices;
  • conduct consultations with the relevant trade unions or employee representatives; and
  • determine the course of action during the above process.

Protections

What protections do employees have on dismissal?

In case of termination of an employment agreement with notice – and in some cases without notice – the Labour Code provides special protection in certain circumstances (eg, if an employee has been absent from work, is within four years of the retirement age, is pregnant or has performed functions for a trade union).

Further, where an employee is a member of a trade union or has applied to a trade union to defend their rights, the employer must notify the trade union of its intention to terminate:

  • an employment agreement for an indefinite period with notice; and
  • an employment agreement for any period without notice.

In case of dismissal for reasons unrelated to the employee within the meaning of the Act on Special Principles for Termination of Employment Relationships with Employees for Reasons Not Relating to Employees, the employee will be entitled to one of the following severance payments, depending on their length of service:

  • one month’s salary – if the employee has been employed for less than two years;
  • two month’s salary – if the employee has been employed for two to eight years; and
  • three month’s salary – if the employee has been employed for more than eight years.

The severance payment cannot exceed 15 times the amount of the minimum compensation for work determined on the basis of separate provisions which apply on the date of termination.