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TERMINATION OF CONTRACT OF EMPLOYMENT

In continuation of our series on the law of employment in Vanuatu we will reflect on termination of employment under the Employment Act. This area of the law is contained under Part 10, Sections 48 to 53.

What is termination?

Termination is when an employee’s job ends. This includes termination by choice, meaning you resign or retire and involuntary termination, meaning you are terminated by your employer.

When is a contract terminated?

Your contract of employment is terminated on the last day of work agreed in your contract, whether written or unwritten, or on the completion of a particular piece of work.

 

 

What is Notice?

Notice is the amount of time required in law that either an employer or employee must give to the other of an intention not to continue to work with the other.

 

 

Amount of Notice given to terminate a contract?

Notice can be given in writing or verbally and at any time during the contract of employment. Notice can always be more than what is stated in the law but it can never be less.

If you have been working with your employer continuously for at least 3 years then your employer must give you at least three (3) months’ notice of his intention not to keep you. Likewise, if you wish to leave then you must give your employer at least three (3) months’ notice.

Anyone working less thanthree (3) years, the amount of notice would be calculated based on how they are paid. Therefore, if you are paid every 14 days then you are to receive at least 14 days’ notice and you are to give at least 14 days’ notice.

If you are paid less than every 14 days, then your notice will be equal to the time when you next get paid, that is, if paid every seven (7) days then your notice will be seven (7) days.

 

When is notice not given?

  1. For serious misconduct, or
  1. If your employer prefers to pay your wages or salary for the period you would have had to serve your notice then he does not need to give you notice. E.g., if you were to serve notice of 3 months, the employer can simply pay you three (3) months’ worth of wages and let you go immediately. Likewise, if you do not give notice then your employer is entitled to deduct it from your wages.

What is serious misconduct?

This is behaviour that causes serious and future risk to the reputation or profits of the business or health and safety of another person, or is behaviour that is inconsistent with continuing in that particular job. This could include, persistent disobedience or rudeness, frequent absence from work or frequent lateness, dishonesty or theft, unable to properly perform your duties, sexually harassing other workers.

What cannot be described as misconduct

Your employer cannot dismiss you for serious misconduct on the grounds that;

  1. You belong to or are participating in a trade union, or
  2. You are attempting to be elected as a representative for the employees, or
  3. You make a justifiable complaint against an employer or participate in any proceedings against an employer.

Right to be heard

If you have been accused by your employer of serious misconduct, your employer must give you an opportunity to defend yourself. If he fires you without you defending yourself then any dismissal will be unfair and you could seek advice from a lawyer or speak with the Labour office. After he hears you he may still decide to let you go.

If your employer is aware of the misconduct and does not act on it within a short time, he cannot later decide to fire you for it.

 

 

Can an employee seek work during his notice period?

When you have been given notice by your employer that your contract will come to an end by a certain date, your employer must allow you some time off to look for other work or to attend interviews and he cannot deduct any money from your wages for that time you are absent. DO NOT abuse this right. Be aware of your employer’s time and try to schedule interviews when it is least disruptive to your employer.

 

 

Entitlement to a reference

The law states that you are entitled to a certificate of employment. This is a document from your previous employer stating the dates you worked for him and the type of work you did. Your employer cannot say anything bad about you in that document. Any previous employer must give you this if you ask. What you are not entitled to is a reference. A reference will give more detailed information about your work and whether you are a good and competent worker. A reference can say both good and bad things about your time of employment.

When is an employer in breach of contract?

An employer will be in breach of contract if he does anything that breaks the agreement between you and him, or if he ill-treats you, or treats you in such a way, or commits a serious breach of the agreement that gives you no choice but to leave before the end of the contract. In that case, you would be entitled to your full pay for the period of notice and you would still have the right to sue your employer for damages.

If your employer breaches the contract, or ill-treats you, and you do not do something within a reasonable time you cannot later leave and use that as your reason. In that instance you would not be entitled to receive notice pay or any other damages.

DISCLAIMER – This is a legal column to provide basic information on the law and court procedure. It is not to be used as a substitute for legal advice but to be used only as a starting point in understanding what you might need and what you might need to do. 

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