In accordance with the Labour Code, grounds for termination of the employment contract are:
- the parties' agreement;
- expiration of the employment contract;
- employer's initiative;
- employee's initiative;
- transfer of an employee to work for another employer;
- owing to circumstances beyond parties’ control;
- refusal of the employee to continue working;
- transfer of an employee to an elected job;
- breach of the conditions of the contract.
For terminating a contract by the parties' agreement, one party must notify the other. The second party must respond to the proposal in writing within three working days. Date of termination of the employment contract is established by the agreement.
An employment contract may be terminated by the employer in many situations, some of which include:
- liquidation of a legal entity employer or termination of the activities of an individual employer;
- reduction in staff numbers or positions;
- reducing the volume of production, works and services, which caused deterioration of the economic status of the employer;
- unfitness of the employee for the position held or work performed as a consequence of inadequate qualifications;
- unfitness of the employee for the position held or work performed as a consequence of health reasons hampering continued performance of the given work;
- negative result of work performed during a probationary period;
- absence of the employee from work without valid reason for three or more hours per working day;
- failure of a worker in a test checking the knowledge on occupational safety and health or industrial safety of the employee responsible for security and protection of workers engaged in production activities.
Employment contract is terminated after serving a written notice stating the reasons for termination of a contract. The employer must inform the employee in writing at least one month ahead about the liquidation of the organization or staff reduction (redundancy) or in the case of individual dismissal unless the employment contract or the collective agreement provide for longer notice period. With the written consent of the employee, termination of employment is allowed before the expiry of the notice period by paying compensation in lieu of notice period (full or partial term). The parties may agree to give the employer unilateral right to terminate the contract without serving any notice against a compensation, the size of which is determined under the employment contract.
In the case of dismissal in connection with the decrease of production volume, worker is informed at least 15 working days beforehand. Termination of contract in such case is possible once the following conditions are met:
1) closure of structural unit;
2) lack of an option to transfer worker to another suitable job;
3) a written notice of at least one month to employee representative indicating the reasons for termination of employment contract.
Termination of a worker who has less than two years in reaching the retirement age on the ground of reduction in staff numbers/positions or as a consequence of inadequate qualifications to perform work must be authorised by ad-hoc joint employer-employee commission created for the purpose. Termination of a worker on leave due to temporary incapacity is not allowed except in the case of liquidation of employer, when the violation of labour duties by a unit head or organization head caused a material damage to the employer, and absence of a worker for more than two months on account of temporary disability. Termination of employment contract on the ground of reduction in staff or production volume (redundancy) is not permitted for pregnant women (with a certificate of pregnancy), women with children under three years, single parents raising a child under 14 (limit is raised to 18 for disabled child).
The employee may leave job by his initiative in a month after written notification. The employment contract is allowed to establish a longer term. The employer may agree with discharge earlier.
The worker has the right to notify the employer in writing about the breach of conditions of the employment contract. If violation of the terms of employment continues after seven days of complaint submission, the employee may terminate the contract by written notice to the employer within three working days.
Sources: §49, 50, 52, 53 and 56 of the Labour Code
The employer makes compensation payments due to loss of work in amount of one month’s average wage in the following cases:
- liquidation of the organization;
- staff reduction;
- breach of the conditions of the contract by employer.
In the case of the decrease of production volume, compensation is in amount of two month’s average wage. The severance payment is not dependent on the length of service. The Labour Code mainly provides severance payments in the case of economic dismissals/redundancy.
By agreement with the employee, the employment contract may provide for the right of the employer to terminate the employment contract without notification, but with compensation payment. Its size is determined by the labor contract.
If the worker achieves retirement age, he will get compensation in the amount by the contract, collective agreements, acts of the employer. At the discharge of the seasonal worker, he may get compensation in the amount of two-week average wage in the case of the liquidation of the organization or staff reduction.
Upon termination of the employment contract, a worker who has not used or not fully used the annual paid leave will get compensatory payment for it.
Other rates of payments may be established by collective bargaining agreement and employment contracts.
Sources: §53, 96 and 131 of the Labour Code