Did your employment terminate during lay-off? Read this!
Some new co-operation negotiations are to be expected during the autumn as the coronavirus crisis is dragging on. Furthermore, lay-offs are expected to turn into terminations of employment in many fields. We compiled in this blog entry an up-to-date info package on the period of notice and termination of employment during lay-off.
According to our Jäsenpulssi survey conducted in August, more than half (56%) of our laid off members believed that their employment situation will remain the same i.e. the lay-off will continue for the next six months.
Rights and obligations during the period of notice
If employment is terminated by a notice, at the end of the employment there is period of notice during which the rights and obligations related to the employment continue to remain valid. So as a general rule, the employee has to work for the employer against a salary during the period of notice.
If the employee fails to observe the period of notice, the employer is not obliged to pay a salary, and the employee may have to pay compensation for the non-observed period of notice.
Sometimes the employer may release the employee from the obligation to work during the period of notice. The employer’s obligation to pay salary shall not be removed, but the employer has to pay the employee the salary for the period of notice.
You should ask your employer to provide a written notice on removing the obligation to work in case of any uncertain situations.
Duration of the period of notice
According to the Employment Contracts Act (55/2001), the employer and employee may mutually agree on the periods of notice as long as the duration of the period of notice is no longer than six months. Collective agreements may, however, include mandatory regulations about periods of notice, references to the Employment Contracts Act or an option to agree at the time of termination of employment, so you should check the collective agreement applied to your employment relationship.
Often the period of notice stated in employment contracts is “general periods of notice according to the law”. The Employment Contracts Act prescribes about the general notice periods which shall be observed when the parties have not agreed otherwise.
So a provision agreed on in the employment contract or a mandatory provision of the collective agreement shall supersede the notice period determined in the law. Unless otherwise agreed, the notice periods to be observed are the following if the employment relationship has continued uninterruptedly:
When the employer gives a notice of termination to the employee
Duration of employment
Period of notice
Up to one year
More than one year but no more than four years
More than four years but no more than eight years
More than eight years but no more than 12 years
More than 12 years
When the employee gives a notice of termination to the employer
Duration of employment
Period of notice
Up to five years
More than five years
An employee whose employment has been terminated due to economic or production-related reasons during the period from 1 April – 31 December 2020 shall be re-employed, if the employer needs employees for the same or similar positions within 9 months from the termination of the employment.
How does lay-off affect if the employer terminates the employment?
If the employer gives a notice of termination of employment, the employer shall pay the employee compensation that equals the salary for the period of notice. The employer may deduct the salary of 14 days from the salary for the period of notice, if the employer has used a lay-off notice period of over 14 days when laying off employees.
How does lay-off affect if the employee terminates the employment?
As a general rule, the employee has the right to terminate the employment without a period of notice during lay-off, but in that case they are not entitled to receive pay for the period of notice. If the employee knows the end date of the lay-off period, the employee does not, however, have the right to terminate the employment without a period of notice during the seven days preceding the end of the lay-off.
What is lay-off until further notice?
If full-time lay-off has lasted without interruptions for a minimum of 200 calendar days, i.e. it is lay-off until further notice, the employee has the right to receive compensation in the amount of the salary for the period of notice intended to be paid by the employer, if the employee terminates the employment.
Despite the salary the employee is not obliged to work during the period of notice, because the employment is considered to have terminated due to reasons attributable to the employer. The employer has the right to deduct the salary of 14 days from the salary for the period of notice, if the employer has used a lay-off notice period of over 14 days when laying off employees
In case of those laid off part-time, the condition for uninterrupted lay-off is not fulfilled as a general rule. In exceptional cases the employer may be obliged to pay salary for the period of notice also to those laid off part-time, if the employee has only worked for a very small portion of their regular working time, or the employer has asked the employee to come to work only to avoid the limit of 200 days to be fulfilled.