Employment Contract Termination: Grounds, Dismissal, and Legal Consequences

Posted on Feb 27, 2025 in Law & Jurisprudence

Unit IX – Termination of Employment Contract

Grounds for termination of employment contracts are specifically provided for in them, if they are not contrary to law. The mutual agreement must be formalized in the presence of a notary public or a representative of the Labour Management Authority or the Clerk of Court Work in the Labour Court of a shift or two witnesses to the act. Other grounds include:

  • The worker’s death or physical or mental disability that makes it impossible to fulfill the contract.
  • The fortuitous event or force majeure that permanently precludes the continuation of the contract.
  • The deadline or completion of the work in the fixed term contracts or work.
  • The death or incapacity of the employer, provided that results in a compelling or forced termination of the work.
  • The employer’s bankruptcy or liquidation judicial business, except where the liquidator, in accordance with relevant legal procedures, resolves that should continue the business or farm. If you continue, the trustee may, if circumstances so require, request amendment of the contract. The rehabilitated must be made with the same workers or union.
  • The complete closure of the company, or the final reduction of the chores, after written notice to the labor administration authority, which will share summary workers before taking the decision respective.
  • The depletion of the subject matter of an extractive industry.
  • The dismissal of an employee by the employer for cause as provided in this Code.
  • The retirement of the employee for cause under the law.
  • The termination of the contract ordered by competent authority, for other causes of termination of contracts in accordance with the provisions of common law which is applicable to the employment contract.

Dismissal for Cause: Valid Reasons

There are valid reasons for termination of the contract by unilateral will of the employer, including:

  • The deception by the employee using false certificates or personal references on ability, moral behavior or attitudes of a worker.
  • Theft, robbery or other crime against property of persons, committed by the worker in the workplace whatever the circumstances of its commission.
  • The concurrence of the employee to work drunk or under the influence of drugs or narcotics, or carrying dangerous weapons, except those which, by the nature of work, we were allowed.
  • Participating in an illegal strike by a competent authority.
  • The abandonment of work from the trabajador.
  • The unexcused absence or without notice, to assist the worker with a office.

Unfair Dismissal

When the employer terminates the employment contract, not based on some of the grounds for dismissal provided for by law or improperly applied, this situation is compensable for the employer.

Justified Withdrawal

The removal is justified if the worker proves the existence of a cause attributable to the worker.

Legal Consequences

If justified in withdrawing, the employee is entitled to the indemnity provided for unfair dismissal and lack of advance warning.