snowy bikesAfter years of economic recession, double dips, financial cliffs, bankrupt member states and other woes, employees across Europe are still worrying about their employment situation. That is if they haven’t already been sacked. Regardless of which sector their employer is operating in, many employees are victims of the fallout of the financial crisis. Restructuring, downsizing and hire freezes have been on everyone’s minds and few are unaffected by the icy winds of employment uncertainty. We have all seen bailout after bailout, government stimulus packages and changes in employment policies.

In the centre stage are executives, HR professionals and lawyers still scrambling to reduce Europe’s relatively expensive and inefficient bulging organisations.

The European Employment Law Checkpoint is an excellent resource from Wragge & Co.  It covers a wide spectrum including the commencement and content of the employment relationship, general rules for terminations, individual and collective redundancy, employee’s rights in case of termination and discrimination.

Country Termination Notice Period.  Note: Employment contracts may provide for more notice.

UK

  • Up to 2 years’ service: 1 week.
  • 2 to 12 years’ service: 1 week per completed year (maximum of 12 weeks).

France

  • Up to 6 month’s service: No statutory minimum notice period.
  • From 6 months to 2 years’ service: 1 months’ notice.
  • Over 2 years’ service: 2 months’ notice.

With very few exceptions, the Labour Code does not provide for a notice period in the case of a resignation.

Belgium

Under Belgian law, the duration of the notice period is different for blue-collar and white-collar employees. Also different provisions apply to employment contacts that started before 1 January 2012. Details are available here.

Portugal

 

An employee cannot be dismissed without justification. For dismissals with fair ground, no prior notice is required, but formal disciplinary proceedings are required. For a redundancy dismissal or unsuitability dismissal, the employee is entitled to a prior notice which varies from 15 to 75 days, depending on his/her seniority.

Spain

 

Prior notice is not required if a dismissal is based on disciplinary reasons. However, if a dismissal is based on redundancy reasons, the employer must give minimum prior notice of 15 calendar days (or provide payment in lieu of notice).

Germany

 

  • Less than 2 years of service:  4 weeks’ notice.
  • Over 2 years’ service: 1 months’ notice increasing in line with the length of service to a maximum of 7 months after at least 20 years’ service.

The employee is entitled to remuneration during the notice period.

Ireland

 

The Minimum Notice and Terms of Employment Acts, 1973-2005 require notice:

  • From 13 weeks’ to 2 years’ service: one week’s prior notice
  • From 2 to 5 years’ service: 2 weeks’ prior notice
  • From 5 to 10 years’ service: 4 weeks’ prior notice
  • From 10 to 15 years’ service: 6 weeks’ prior notice
  • Over 15 years’ service: 8 weeks’ prior notice

Italy

 

Notice periods are established by National Collective Labour Agreements and vary based on the employee’s level/qualification and length of service. In the absence of such an agreement, the relevant period is established by Labour Courts. Employees are entitled to terminate their employment agreement either:

  • by giving notice to the employer (which is established under the National Collective Labour Agreements and is usually shorter than the notice due to them in case of termination); or
  • without giving any notice, if a just cause (“giusta causa”) for termination exists.

The Netherlands

 

Except for instant dismissal or dismissal during a probationary period, notice periods to be given by an employer are:

  • Less than 5 years’ service: 1 month;
  • Service from 5 to 10 years: 2 months
  • Service from 10 ti 15 years: 3 months
  • Service over 15 years: 4 months

The statutory notice period to be observed by the employee is one month. Parties may deviate from the statutory notice period in writing. However, the notice period to be observed by the employer must then be twice as long as the notice period to be observed by the employee. No notice period has to be observed in the case of a resignation.

Poland

 

The length of a statutory termination notice period depends on the type of employment contract and seniority.  Termination notice periods for a probationary-term are:

  • 3 days – for a probationary period of up to two-weeks;
  • 1 week – for a probationary period longer than two weeks but less than three months; and
  • 2 weeks – for a three-month probationary period.

Generally a fixed-term employment contract and an employment contract for a specific task will terminate at the end of the fixed term period or on completion of the specific task and cannot be terminated earlier upon notice. Termination of employment for a fixed period is possible if an employment contract is for more than six months and the contract provides for termination with at least 2 weeks’ notice. The length of notice for an indefinite period contract is:

  • 2 weeks – for less than 6 months of employment;
  • 1 month – for 6 months or more of employment and less than 3 years of employment; and
  • 3 months – for 3 years or more of employment.

For further information, go here.

Czech Republic

 

The minimum notice period set by the Czech Labour Code is two months but the parties may agree upon a longer notice period, which must be adequate for the term of employment and type of work. The notice period must be the same for both the employer and the employee.

Source: Wragge & Co _meeting

An interesting study on international dismissal costs was published in 2013 by the accounting giant Deloitte.  This report used four scenarios to which the legal framework of the different Member States were applied so that the overall costs of dismissal could be calculated.

  • Case 1 was an employee of the age of 35, a legal advisor in an IT company with 7 year’s seniority and a gross annual base salary of €60,000.  The gross variable salary per year was €5,000 and benefits in kind per year in gross figures were €8,000.
  • Case 2 was an employee aged 49, a legal advisor in an IT company, 11 year’s seniority, gross annual base salary of €120,000 euros and gross variable salary per year of €10,000 euros and benefits in kind per year of €16,000.

The study analysed the overall costs involved where the dismissal was due to individual reasons (i.e. the employee’s behaviour and ability) or where the dismissal was for economic reasons (i.e. shortage of work.)  The results were rather interesting. Apart from Italy, Belgium was the most expensive country for dismissing employees.

The Table below shows the 5 most expensive countries for dismissal costs for each case.

Case 1, individual/economic reason
1. Italy
2. Belgium
3. Norway
4. Spain Europe
5. Sweden Case

2, individual reasons
1. Italy
2. Belgium
3. The Netherlands
4. Spain
5. Sweden Case

2, Economic reasons
1. Italy
2. Belgium
3. Spain
4. The Netherlands
5. Sweden

The second, and much less surprising, finding of this study was that western European countries face substantially higher dismissal costs compared to central European countries. On average a dismissal in a western European country is expected to be at least two times more expensive than in central European countries.

Facing the sack

Employee rights are constantly changing and are also very susceptible to changes in the domestic political landscape. For instance, the employment legislation in the UK is much more employer-friendly than for instance, Sweden or the Netherlands.  This in turn means that the labour market in the UK is much more dynamic than elsewhere.  On the other hand, employees do not really have a lot of protection against being unfairly dismissed until they have reached to two years’ continuous service.  Employees are still protected from for instance, being discriminated against or suffering a detriment because they are a whistle-blower. Such dismissals are automatically unfair.  However, looking through the window from the UK towards Europe, it may be the proverbial case of “the grass always being greener”.

Looking at other countries

Click here for a brief look at a few EU countries. It is an overview only and it is suggested that you take appropriate professional advice on any particular situation.

Further information

Flexicurity
Another perspective is provided in an article on the flexicurity model that was launched by the European Commission in the mid-2000s. It claimed that there existed such a thing as a ‘golden triangle of flexicurity’. The European Commission urged Member States and trade unions to give up on job protection in exchange for adequate unemployment benefits and active labour market policies. The inspiration for this was Denmark – a country hailed as the perfect illustration of how a flexible labour market with low restrictions on employers to dismiss workers could still offer high security of employment. Read the article, by Ronald Janssen. It says that, contrary to expectation when everything is considered, Denmark does not have a labour market that is particularly flexible at all.

OECD indicators of employment protection
The OECD indicators of employment protection legislation measure the procedures and costs involved in dismissing individuals or groups of workers and the procedures involved in hiring workers on fixed-term or temporary work agency contracts. Details are here.

The European Court of Human Rights found in November 2012 that UK law does not provide an adequate level of protection for people that are dismissed as a result of their political leanings. This protection will be extended to members of all political parties including the BNP and while it does not necessarily mean that employees cannot be sacked for their political beliefs, it does mean that they will be afforded the opportunity for a tribunal.

For a brief look at a few EU countries view this publication. It is an overview only and it is suggested that you take appropriate professional advice on any particular situation. It is derived from the 2013 study by Deloitte.

Sofie Lyeklint

Sofie Lyeklint

Sofie has recently joined the firm and heads up the Employment department specialising in all aspects of employment law. She has a particular interest in Tribunals and drafting employment contracts, staff handbooks and settlement agreements. Sofie also works closely with our Commercial Property and Residential Property departments specialising in Collective Enfranchisement, which is flat owners entitlement to collectively purchase their own freehold, the Right to Manage and Lease Extensions. She is committed to reaching the best commercial outcome for our clients.

Sofie speaks fluent Swedish and Chinese and graduated with a Chinese & Politics honours degree from School of Oriental and African Studies in 2005. She then spent a few years living and working in China before returning to the UK to qualify as a solicitor. In her free time she enjoys scuba diving, boxercise, running and travelling.

She can be contacted at +44 (0)1273 204411 or by email to sofie@engleharts.co.uk
Sofie Lyeklint
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