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Termination and Severance Policies

Learn about the legal processes for employee termination and severance in Armenia

Notice period

In Armenia, the Labor Code outlines the notice periods required for employment termination. These periods vary depending on who initiates the termination and the length of service of the employee.

Notice Period for Employer-Initiated Termination

When an employer decides to terminate an employee's contract, they are required to provide written notice in advance. The duration of this notice period depends on the reason for termination:

  • For staff reduction, employers must give employees a notice period of two months.
  • For other reasons, the notice period varies based on the employee's length of service:
    • For service of less than 1 year, a 14 days' notice is required.
    • For service of 1 year to 5 years, a 35 days' notice is required.
    • For service of 5 years to 10 years, a 42 days' notice is required.
    • For service of 10 years to 15 years, a 49 days' notice is required.
    • For service of more than 15 years, a 60 days' notice is required.

It's important to note that the specific notice periods for service under one year might be subject to different interpretations. It's recommended to consult a legal professional for such cases.

Notice Period for Employee-Initiated Termination

Employees have the right to terminate their employment contract with a notice period of at least one month. There's no requirement to specify a reason for resignation.

Exceptions and Agreements

  • Both parties can agree on a different termination date that deviates from the standard notice period.
  • If an employee commits gross misconduct as defined by the Labor Code, the employer can terminate the contract without notice.

Severance pay

In Armenia, employees are entitled to severance pay under specific termination scenarios as outlined in the Labor Code.

If an employer terminates an employee's contract due to company-related reasons such as liquidation, bankruptcy, or employee reduction, the employee is entitled to a severance package equivalent to one month's average salary.

Severance Pay upon Retirement

When an employee retires, they receive severance pay equivalent to two weeks' pay, calculated based on their average daily wage.

Other Termination Scenarios

There is no general statutory requirement or standard practice for severance pay in Armenia in the following situations:

  • Termination with Cause: If an employee is terminated due to a valid reason related to their conduct or performance.
  • Voluntary Resignation: When an employee voluntarily resigns from their employment.

Additional Information

The severance pay entitlements mentioned above are the minimum under the Law. Employers may offer a more generous severance package at their discretion or as per collective bargaining agreements.

Termination process

The termination process of employees in Armenia is governed by the Labor Code of the Republic of Armenia. Here's a simplified breakdown of the process:

Notice of Termination

When an employer initiates the termination of an employment contract, they must provide written notice of termination to the employee. The notice period depends on the reason for termination and employee seniority (Labor Code Article 126). On the other hand, employees wishing to resign must provide at least one month's written notice to the employer (Labor Code Article 125).

Documentation and Finalization

The employer should provide a detailed termination letter explaining the grounds for termination (if applicable). Employers must also provide a certificate of employment detailing the employee's start and end dates, position held, and salaries. The final paycheck should cover any owed wages and unused vacation days.

Additional Considerations

Employers can terminate an employee with just cause, such as serious misconduct or consistent poor performance. In these cases, severance pay may not be required. Certain categories of employees, like pregnant employees or those engaged in trade union activities, have extra protections against unlawful dismissal. In case of disputes regarding termination, employees can refer complaints to the Labor and Social Inspection Body of the Republic of Armenia or seek resolution in labor courts.

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