Resignation and Dismissal: A Right by Will, an Ending with Regulations

The employment relationship is not a transient bond that ends with the close of the workday, nor a contract whose pages are folded away upon signing. Rather, it is a legal relationship that gives rise to rights and settles obligations upon both parties. When an employee chooses to terminate it by resignation, or an employer decides to put an end to it, the matter shifts from mere will to legal consequences governed by statutes and regulations. No resignation can extinguish a right guaranteed by law, and no termination can be exercised without restriction.

The Labor Law No. 6 of 2010 and its amendments regulate the termination of the employment relationship. They permit either party to a contract of indefinite duration to terminate it, subject to a notice period of three months for employees paid monthly, and one month for others. Failure to observe this notice period obligates the terminating party to pay a notice compensation equivalent to the employee’s wages for that period.

During the probationary period, either party may terminate the contract without notice. The employer may also exempt the employee from work during the notice period, provided the employee continues to be employed and remains entitled to wages. If the notice is given by the employer, the employee may be absent for one full day per week, or for eight hours during the week, to seek employment, while remaining entitled to wages.

Digital Newspapers

Constitutional Law and Civil Rights

As for contracts of definite duration, wrongful termination entitles the other party to compensation for any resulting harm. Conversely, Article 48 permits the employee to terminate the contract without notice and remain entitled to the end-of-service gratuity in certain circumstances, including the employer’s breach of obligations, assault on the employee, endangering the employee’s health or safety, fraud or misrepresentation at the time of contracting, the employee being charged with a crime and finally acquitted, or the employer or their representative committing an act of indecency toward the employee.

In the case of resignation, the end-of-service gratuity is tiered according to length of service. If the service period is less than three years, the employee is not entitled to a gratuity. If it is three years or more but less than five, the employee is entitled to half the gratuity. If it is five years or more but less than ten, the employee is entitled to two-thirds of the gratuity. If it is ten years or more, the employee is entitled to the full gratuity. An employee is deemed to have resigned if they are absent from work without a valid excuse for seven consecutive days, or for twenty non-consecutive days within a year.

The gratuity is calculated based on the last wage, taking into account the wage components and benefits prescribed by law. For piece-rate workers, the calculation is based on the average wage over the last three months and the average cash and in-kind benefits over the last twelve months. The employee’s actual service period is counted from the date of appointment to the last day of work, after deducting days of absence and unpaid leave. Unpaid sick leave is not deducted, as it is a leave guaranteed by law. The employee is also entitled to a cash settlement for any accumulated annual leave balance.

Conversely, the law does not deprive the employer of the right to terminate the employment relationship. Article 41(a) permits dismissal without notice, compensation, or gratuity in certain cases, such as committing an error that results in serious loss, obtaining employment through fraud or misrepresentation, or disclosing the establishment’s secrets. Clause (b) also permits dismissal in cases including a final conviction for a crime affecting honor, integrity, or morals; committing an act of indecency in the workplace; assaulting a colleague, the employer, or the employer’s representative; breaching contractual or legal obligations; or repeatedly violating instructions, provided that such dismissal does not deprive the employee of the end-of-service gratuity.

Article 51 establishes the rules for calculating the end-of-service gratuity. An employee paid on a daily, weekly, hourly, or piece-rate basis is entitled to ten days’ wages for each year of service during the first five years, and fifteen days’ wages for each subsequent year, up to a maximum of one year’s wages. An employee paid on a monthly basis is entitled to fifteen days’ wages for each year of service during the first five years, and one month’s wages for each subsequent year, provided that the gratuity does not exceed one and a half years’ wages. To protect rights, any settlement or release that diminishes the employee’s rights during the term of the contract or within three months after its termination is void. Furthermore, an employee’s claim is time-barred one year after the contract’s termination if the employer denies the claim; the party invoking this defense must swear an oath that the debt has been paid. Before filing a lawsuit, the parties must refer the dispute to the Labor Department for amicable settlement; if settlement fails, the dispute is referred to the court.

Thus, resignation does not constitute a release from obligations, nor does termination grant unlimited authority. Between the employee’s will and the employer’s power stands the law, safeguarding rights, regulating authority, and maintaining the balance in the employment relationship.

Legal Advisor