Unilaterally terminatation of the labor contract does not require the company to fully and strictly comply with the prescribed procedures as disciplinary dismissal. The company has the right to unilaterally terminate the labor contract with the employee in some special cases. Therefore, understanding the law on this case will help employees know if the enterprise has unilaterally terminated the labor contract illegal.
To know whether a company unilaterally terminates the labor contract in accordance with the law or not, we need to consider the following aspects:
First, when does a company have the right to unilaterally terminate the labor contract?
Comparing between Article 38 Labor Code 2012 and Article 36 Labor Code 2019, Labor Code 2019 has provided more specific and detailed provisions on the cases that enterprises are entitled to unilaterally terminate the labor contract. These are the following cases:
- The employee repeatedly fails to perform his/her work according to the criteria for assessment of employees’ fulfillment of duties established by the employer;
- The employee is sick or has an accident and remains unable to work after having received treatment for a period of 12 consecutive months in the case of an indefinite-term labor contract, for 06 consecutive months in the case of an labor contract with a fixed term of 12 – 36 months, or more than half the duration of the contract in case of an labor contract with a fixed term of less than 12 months;
- In the event of a natural disaster, fire, major epidemic, hostility, relocation or downsizing requested by a competent authority, the employer has to lay off employees after all possibilities have been exhausted;
- The employee is not present at the workplace after the time limit of the temporary suspension of the labor contract is expired;
- The employee reaches the retirement age, unless otherwise agreed by the parties;
- The employee quits his/her fails to go to work without acceptable excuses for at least 05 consecutive working days;
- The employee fails to provide truthful information during the conclusion of the labor contract that affects the recruitment.
Thus, when the company unilaterally terminates the labor contract which does not fall into the above cases, it is a illegal unilateral termination of the labor contract.
Second, is it the case that the company cannot unilaterally terminate the labor contract?
Article 37 Labor Code 2019 defines 3 cases in which a company is prohibited from unilaterally terminating an labor contract:
- The employee is suffering from an illness or work accident, occupational disease and is being treated or nursed under the decision of a competent health institution;
- The employee is on annual leave, personal leave, or any other types of leave permitted by the employer.
- The employee is pregnant, on maternal leave or raising a child under 12 months of age.
Accordingly, if the employee falls into one of the above cases but the company still unilaterally terminates the labor contract, it is an illegal decision.
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