An employment relationship ends when it is terminated, cancelled, or ended with a mutual agreement. Termination of employment is subject to regulations, and failure to comply with them may result in liability for compensation.
We help with questions such as:
- How to properly terminate an employment relationship
- How to communicate the termination correctly
- How to avoid unlawful termination
- How to prevent employment disputes by making an exit agreement
Termination of employment is often a difficult process for both the employee and the employer. It involves various legal and communication aspects that must be carefully considered. Poor communication and hasty actions can lead to disputes between the employer and the employee. In the worst case, uncertainty about the termination can last for months and result in significant costs.
An action plan prevents mistakes.
We help you with the following actions:
- Assessing the available measures
- Creating a plan based on the assessment
- Negotiating and drafting an employment termination agreement (exit agreement).
Grounds of termination
The grounds for terminating an employment agreement are regulated by the Employment Contracts Act. Depending on the situation and certain conditions, an employer may terminate or cancel the agreement.
Personal grounds for termination and financial or production-related termination grounds should be kept separate, as the nature of these situations differs significantly, and each has its own legal provisions.
If termination based on personal reasons is being considered, it is important to remember that, as a general rule, the employee should first be given an opportunity to correct their conduct through a warning.
Working shareholders
A departing employee may also hold shares in the employer’s company or have options entitling them to shares. Typically, the terms of a shareholder agreement or option agreement determine whether the departing employee can retain the shares or if they will be redeemed. These aspects must also be considered on a case-by-case basis.
