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Employment regulations


An employment relationship is established upon the signing of an employment contract. The law prescribes the mandatory content elements of employment contracts, such as the base wage and the position (job title) of the employee and the place of work. The term of the employment is also to be determined in the employment contract, in the absence of which the employment relationship is considered as entered for an indefinite term. The employment contract may also provide for a trial period, the maximum length of which is three months, except where a collective agreement has been concluded. Should a collective agreement be available the maximum length of the trial period is set at six months. Through a unilateral written statement either the employer or the employee may terminate the employment relationship during the trial period with immediate effect, without stating the reasons for such termination.




• upon termination with notice;

• upon termination without notice by either the employer or the employee;

• upon the mutual agreement of the employer and the employee;

• with immediate effect at any time during the trial period.

Termination shall be in writing, and the employer must provide its reasons. Such reasons may be in connection with the employee’s ability, with his/her behaviour in relation to the employment relationship, or with the employer’s operations. In certain situations and circumstances detailed by the Labour Code, the employee is entitled to protection from termination (e.g. pregnancy, during maternity leave, during a leave of absence without pay for the purpose of nursing or caring for children).

In case of the termination of indefiniteterm employment contracts, the notice period is 30 days, which may be extended by an additional period of not more than 60 days based on the length of the employment relationship in case of termination by the employer. The amount of the severance pay shall be equal to the absence fee due for one to six months, depending on the length of the employment relationship. Employees first become entitled to severance pay after three years of employment with the given employer.

An employer or employee may terminate an employment relationship by termination without notice in the eventthat the other party commits a material breach of any substantive obligation arising from the employment relationship wilfully or by gross negligence, or otherwise engages in conduct rendering the further maintenance of the employment relationship impossible. Special rules are applicable in the case of termination of contracts concluded for a fixed term.

Source: HIPA