Notice and Severance
Notice Requirement
What is the relevant legislation on the notice requirement before a contract termination?
The Decent Work Act regulates provisions regarding notice requirements.
What are the different types of contract termination? (termination by the worker or employer)?
The party wishing to terminate the employment contract is obliged to provide a notice period. This means law allows both workers and employers to terminate employment contracts.
What is the required notice period (in weeks) for terminating a contract (fixed term, indefinite term, probationary contract)?
While the law does not specify separate notice periods for fixed-term, indefinite-term, or probationary contracts, it clarifies that no notice is required when termination is justified by just cause. Depending on the continuous service of an employee, the following notice periods are required:
- 2 weeks’ notice for a service of 3 to 6 months
- 3 weeks’ notice for a service of 6 to 12 months
- 4 weeks’ notice for a service of more than one year
During a probation period, either party can end the contract with at least 7 days’ written notice before the probation ends.
What is the required notice period for terminating a contract (initiated by the worker)?
The party wishing to terminate the employment contract is obliged to provide a notice period ranging between two and four weeks, depending on the length of service.
Under what circumstances may a contract terminating party not serve any notice?
An employer has the right to dismiss an employee immediately in cases of grave misconduct.
In general, no notice is required when termination is justifiable by reason (just cause).
Is there a provision for compensation instead of notice?
An employer may choose to pay (compensate the employee) in lieu of notice. So, instead of giving an employee notice of termination, the employer pays the employee a sum of money equal to that they would have earned during the minimum period of notice.
Sources: §12.1,13.1,14.3,14.4 & 14.6 of the Decent Work Act, 2015
Severance Pay
What is the relevant legislation on severance pay?
The Decent Work Act, 2015, governs the provisions on severance pay on termination of employment.
Under what circumstances is severance pay admissible (individual dismissals vs collective dismissals)?
It applies when employment is terminated for economic reasons, such as redundancy or business closure.
What is the rate at which severance pay is payable to a worker? (days or percentage of former salary)
Severance pay is payable at 4 weeks of pay for each completed year of service.
Any other payments due to a worker (other than severance pay)? (unpaid leave, bonus, etc.)
Employers are required to provide notice and fulfil severance pay obligations alongside other termination-related payments. These include remuneration for accrued but unused annual leave, calculated pro rata for service periods of less than a year, as well as compensation for any unpaid leave or contractual bonuses.
Sources: §14.5 and 18.4 for the Decent Work Act, 2015
