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Termination of an Employment Contract

Introduction

1. Grounds to terminate an employment contract
Pursuant to the Labor Code of the Russian Federation, grounds to terminate an employment contract are divided into the following main groups, subject to reason for such termination:

1) the initiative of an employee;
2) the initiative of an employer;
3) the agreement between an employee and an employer;
4) circumstances beyond the control of both an employee, and an employer.

a) Termination of an employment contract on the initiative of an employee
An employee has the right to terminate an employment contract of one’s own free will. To do so, he/she must meet the procedure defined by the law, which may differ, depending on a category of an employee (ordinary employee, temporary employee, executive officer, etc.).

b) Termination of an employment contract on the initiative of an employer
Unlike an employee, an employer may not dismiss an employee without any grounds.

Regarding an ordinary employee, a limiting list of such grounds has been specified by the law, which grounds can be conventionally divided into the following groups.

1) Grounds related to business operations (e.g. staff redundancy, liquidation of an organization or its business unit, etc.);

2) Grounds related to personality of an employee rather then his/her faulty actions (e.g. insufficient qualification);

3) Grounds related to the faulty actions of an employee i.e. breaking of rules introduced by an employer. Further, some of the violations specified in the Labor Code of the Russian Federation may result in the dismissal even though a violation were committed once only (e.g. a gross violation of safety engineering rules, disclosure of a commercial secret or other secret of a company; appearance at work in a state of intoxication).

Importantly, a different employment contract termination procedure shall be addressed for each group of grounds pursuant to the legislation to meet the due process of law.

Besides, it should be noted that there are such certain periods of time that employees may not be dismissed on the initiative of an employer, except for the liquidation of an employer’s company, namely:

- pregnancy;
- illness (disease) of an employee;
- being on holiday.

c) Termination of an employment contract on the agreement of the parties
An employment contract may be terminated by the agreement of the parties. Such an agreement normally takes the form of a supplementary agreement attached to an employment contract, where a term for leaving a job, amount of compensation due to an employee, and other employment contract termination terms are to be defined.

Entering into such an agreement will make it possible for an employer to avoid the necessity to follow the dismissal procedure, stipulated in the law, and preclude the risk that the dismissal be held invalid.

d) Termination of an employment contract due to the circumstances beyond the control of both an employee and an employer
An employment contract may be terminated due to the circumstances beyond the control of both an employee and an employer. The list of such circumstances is strictly limited by law (of all things, for instance, military draft, reinstatement of employment for an employee who was previously carrying out this work, extraordinary circumstances preventing from the continuation of employment relations, etc.).

2. Procedure for Employment Contract Termination
One should consider for the dismissal of an employee that the procedure for the employment contract termination has been specified in the labor legislation to be followed by an employer.

For instance, the termination of an employment contract is accompanied by an order issued by an employer, and an employee must sign that he/she has read such order.

On the day of termination of an employment contract an employer must give his/her work-related documents required to an employee and make all the payments without any exception due to an employee (salary (wage), bonuses, compensations, etc.)





 
 
 
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