In recent years, the global economy has undergone significant shifts, particularly in lucrative industries like the IT sector. Rising living costs and increased business expenses have put pressure on these sectors, leading to widespread layoffs. This trend has captured public attention not due to the industry’s allure, but because many employees have lost their jobs as companies tighten budgets to manage financial obligations.

A prominent example is the mass layoffs at Twitter following Elon Musk’s acquisition, sparking debates about whether such terminations might qualify as wrongful dismissal and violate workers’ rights.

While the topic of employment termination is broad and complex, this article will cover some of the essential aspects of termination agreements and workers’ rights during the process.

Overview of Employment Termination

Employment contracts can end in two primary ways:

1. Employer-initiated termination

2. Employee-initiated resignation

Employers can terminate employees for various legally defined reasons, generally categorized into four groups:

1. Reasons related to job performance or behavior

2. Violations of work obligations

3. Breaches of work discipline

4. Valid reasons linked to the employer's needs

Each category has specific causes for termination. Employers must adhere to a defined procedure when issuing termination notices, ensuring that notices are delivered personally either at the workplace or at the employee's residence.

Employees, on the other hand, can resign for any reason, provided they give adequate notice—usually at least 15 days, but it can be longer depending on company policies or employment contracts. During this notice period, employees are expected to continue fulfilling their regular work responsibilities.

Collective Terminations and Union Involvement

The economic downturn in 2022 and 2023, largely driven by issues in the banking and energy sectors, has also brought collective layoffs into the spotlight. Collective dismissals often occur due to technological, economic, or organizational changes within a company. In these cases, employers are required to work with unions and the National Employment Service to mitigate the impact on affected workers and to devise strategies for managing redundancies.

Unions play a critical role in reviewing and providing feedback on programs developed by employers to address redundancies. Employers must respond to union feedback within eight days, ensuring a collaborative approach to collective terminations.

Severance Pay for Terminated Employees

Employees who lose their jobs due to technological changes are entitled to severance pay. This financial compensation, paid before termination, serves as a cushion for laid-off workers. The minimum severance is determined by law and is based on a fraction of the employee’s salary for each year of service. However, employers can offer more favorable terms in their internal policies or contracts.

It’s important to note that severance calculations consider the employee’s total years of service, even if the company has undergone mergers, acquisitions, or other structural changes. Changes in ownership, such as privatization, do not impact an employee’s entitlement to severance pay.

Situations Where Termination Is Prohibited

Employers face certain legal restrictions when terminating employees, particularly to protect vulnerable groups. These restrictions prevent termination in specific cases, such as during pregnancy, maternity leave, or childcare leave. These protections are non-negotiable, ensuring that employees in these situations cannot be dismissed, even if the company undergoes significant organizational changes.

Employees involved in union activities are also protected. An employer cannot terminate or disadvantage an employee due to union membership or participation in union activities. This protection extends to union representatives for up to a year after their term ends, as long as they follow the law and their employment contract.

Discrimination in Employment Termination

Discrimination in the termination process is strictly prohibited. Employers cannot dismiss employees based on characteristics such as gender, race, religion, nationality, or political beliefs, among others. Discriminatory termination, including unequal pay for equal work, is illegal, and affected employees have the right to seek legal recourse.

Employees who experience discriminatory termination can file claims for compensation and seek legal protection to safeguard their rights.

Violations of the Termination Process and Worker Rights

When employers fail to follow legal procedures during the termination process, it is considered an abuse of termination rights and a violation of workers’ rights. In such cases, employees can take legal action, which may result in reinstatement or compensation for lost wages. Employers who violate termination laws may face substantial financial penalties, including legal costs and damages.

Fixed-Term Employment Termination

Fixed-term employment contracts typically last up to two years, with termination occurring at the end of the agreed period. However, employers can terminate these contracts earlier under certain circumstances, such as performance-related issues or organizational changes. The procedures and restrictions for terminating fixed-term contracts are similar to those for indefinite-term employment.

For foreign workers, fixed-term contracts may also terminate when a work permit expires and is not renewed.

Legal Advice for Employment Termination

Whether you're an employee facing termination or an employer handling layoffs, understanding the legal aspects of the termination process is essential. If you believe your rights have been violated, seeking advice from a lawyer experienced in employment law can help protect your interests. Likewise, employers should consult legal professionals to ensure that their termination processes comply with the law and avoid costly mistakes.