As a rule, all employment contracts for indefinite time may be terminated at earlier notice (save for a number of instances when termination is prevented by statutory restrictions).
Termination of employment contracts for indefinite time is traditionally just-case termination, meaning that the employer is required to provide a reason for termination, which is true and valid. Otherwise the dismissal will be considered unfair.
There is no definition of just cause in the Labour Code, nor does it provide a list of qualifying reasons. Instead, it is left for the courts (mainly to the Supreme Court) to explain what may and should by understood under just cause justifying termination of the employment contract for indefinite time.
Examples of ‘just cause’ situations include:
- employee’s negligence;
- unsatisfactory employee’s performance;
- unjustified absence from work;
- breach of the covenant not to compete while the employment contract is in force;
- absence of required and/or expected qualification or skills;
- failure to perform the superior’s instructions.
Just cause for termination may be related to the employee or the employer, but doesn’t have to – it may just as well be an event which neither party has got influence on.
Termination of the employment contract at earlier notice is a regular manner of termination, which means that the reason provided by the employer does not need to be extraordinary; it is sufficient that for that (true and valid) reason the employer does not want to continue employment. This is a consequence of the employer’s right to mould his or her workforce.
IMPORTANT! The employment contract for indefinite time may also be terminated by the employee. However, the employee is not required to provide the reason for termination – such an obligation rests only with the employer.
The declaration on termination at an earlier notice (whether made by the employer or the employee) must be in writing. Additionally, the employer’s declaration must include information of the employee’s right to challenge the termination at court.
The duration of notice periods depend on the employee’s length of employment with the particular employer. I will discuss this in the next entry.