Termination with notice is a ‘unilateral act’ by the employee or the employer. The employment contract may be terminated by the worker, and the employer as well. The worker may terminate the employment contract by a written statement announcing their intention to terminate. The worker (as a ‘weaker’ party in the employment) is not required to explain the reasons for their intention to terminate the employment contract. In labour law and in everyday life, termination of an employment contract by the employer is of special significance, hence the protection of workers against unlawful (ungrounded) termination.

Protection of workers from unlawful termination depends on two conditions – existence or non-existence of a just cause (reasonable grounds) for termination of an employment contract by an  employer, and fulfillment or failure to fulfill certain requirements. In case no reasonable grounds exist for termination, and/or the given requirements are not fulfilled prior to termination, termination may be considered unlawful and will be null and void. On the other hand, in cases where there are reasonable grounds for termination and certain requirements prior to termination have been fulfilled, termination will be considered lawful and allowed.    

Reasonable grounds for termination of employment contract are:

Personal reasons (when the employee, due to his conduct, lack of knowledge or capacity, or due to failure to meet the special requirement laid down by law, is not able to perform their contractual obligations or other obligations arising from employment);

Fault as a reason (when the employee is in breach of the contractual obligations or other obligations arising from employment);

Business reasons (there is no longer a need to undertake specific work under the conditions laid down in the employment contract due to reasons of economic, technological, structural or similar nature, upon initiative of the employer).

The Law on Labour Relations ‘allows’ for reasonable grounds, but ‘bans’ unreasonable grounds for employment termination. Unreasonable grounds for termination are membership into trade unions or participation in trade union activities in accordance with the law and collective agreement; lodging a complaint and taking part in legal proceedings against the employer; approved absence from work by reason of illness or injury, pregnancy, childbirth and parenthood, care for dependents and unpaid parental leave; use of approved absence from work and annual leave; compulsory military service or participation in a military exercise; and other cases of suspension of the employment contract laid down by the present law.

Requirements to be fulfilled prior to termination are:

• In the case of personal reasons related to the worker (providing required working conditions, adequate instructions, guidelines and written notification by the employer stating their dissatisfaction of the performance by the worker, and providing an additional period, of no less than 15 days, for the worker to improve their performance);
• In the case of fault implying light breaches of workplace order and discipline and failure of the worker to undertake the obligations that are subject to sanctions by termination with a notice (written notice by the employer warning the employee about the possibility of termination in the case of further breach of obligations from the employment contract, or imposing a fine);
• In the case of business reasons (identifying possibilities for continuation of the employment at the employer prior to termination such as employment with another employer without advertising, by transfer and entering into an employment contract to perform work that corresponds to the employee’s skills and professional qualifications; providing professional training, retraining or additional training; or offering a new employment contract.
• Defining notice periods (in case of reasons for termination requiring a notice period) or payment in lieu of notice (when this payment is agreed upon). The Law on Labour Relations defines the duration of minimum notice periods. If an employer terminates an employment contract of an individual worker or a small number of workers, the notice period is one month. There is a two month notice period in case of termination of employment of more than 150 employees or 5% of the total number of employees with an employer;
• Payment of severance benefits as one time financial compensation for an employee in case of termination due to business reasons (economic, technological, structural or similar). The amount of severance pay is one to seven net-salaries, defined depending on years in service at the same employer (including the previous employer, whose legal successor, due to status changes, is the last employer).

A worker who considers their termination of employment unlawful (unpermitted) may start a procedure for annulment of the decision for termination of their employment contract and seek to be returned to their job position and/or claim damages by the employer. The protection of the rights of employees is done in a procedure consisting of two instances (first before the employer, second before a competent court), in accordance with applicable regulations (primarily the Law on Labour Relations, and the Law on Civil Procedure).