Termination of the employment relationship is subject to strict formal and procedural requirements under Labor Law No. 4857. Where the employer terminates the contract without complying with these requirements, or without a justified cause provided for by law, significant compensation rights arise in favor of the employee.
The Difference Between Justified and Unjust Termination
The law grants both the employer and the employee the possibility of immediate termination for justified cause in certain circumstances (Labor Law Art. 24-25). Outside these circumstances, a valid reason is required for terminations based on the employee's performance or on operational grounds (Art. 18-21); a termination not based on a valid or justified cause is regarded as unjust termination.
Severance Pay
Severance pay arises where the employee has worked at the workplace for at least one year and the employment contract ends for one of the reasons listed in the law (unjust termination by the employer, termination by the employee for justified cause, retirement, military service, etc.). The pay is calculated, based on the employee's last gross wage, at the rate of 30 days' pay for each full year worked.
Notice Pay
In indefinite-term employment contracts, if either party terminates the contract without complying with the notice periods set out in the law according to length of service, they are obliged to pay the other party notice pay (Labor Law Art. 17):
- Up to 6 months of service: 2 weeks
- 6 months - 1.5 years: 4 weeks
- 1.5 - 3 years: 6 weeks
- More than 3 years: 8 weeks
Reinstatement Lawsuit
For employees covered by job security (employees with at least 6 months of service working at workplaces meeting certain conditions), there is also the possibility of filing a reinstatement lawsuit in the case of a termination made without showing a valid reason. If the court finds the termination invalid, it may order the employee's reinstatement, and, if the employee is not reinstated to work, may additionally order job-security compensation.
Conclusion
Unjust termination of an employment contract may bring with it multiple claims, such as severance pay, notice pay, and, depending on the circumstances, reinstatement/job-security compensation. The extent and manner in which these rights may be claimed in a specific case varies according to factors such as length of service, the reason for termination, and the size of the workplace; it is advisable to have the matter evaluated by a legal professional.
You can objectively evaluate the legal basis of a reinstatement petition you have prepared before sending it, using Lawyer Services' Petition Analysis tool.