Navigating the complexities of employment termination in Cabo Verde requires a thorough understanding of local labor law. Employers must adhere to specific regulations regarding notice periods, grounds for dismissal, procedural steps, and severance pay to ensure compliance and avoid potential legal challenges. These rules are designed to protect both employers and employees, providing a framework for ending employment relationships fairly and lawfully.
Understanding the correct procedures for termination, whether initiated by the employer or employee, is crucial for businesses operating in Cabo Verde. Compliance with notice requirements, proper calculation of severance, and adherence to formal processes are fundamental aspects of managing the employee lifecycle in the country.
Notice Period Requirements
When terminating an employment contract in Cabo Verde, employers are generally required to provide employees with a minimum notice period. The length of this notice typically depends on the employee's length of service with the company. Failure to provide the statutory notice period may result in the employer being liable to pay compensation in lieu of notice.
Minimum notice periods vary based on the duration of the employment relationship:
| Length of Service | Minimum Notice Period |
|---|---|
| Up to 1 year | 7 days |
| More than 1 year to 3 years | 15 days |
| More than 3 years to 5 years | 30 days |
| More than 5 years | 60 days |
These are minimums, and individual employment contracts or collective bargaining agreements may stipulate longer notice periods. Notice must generally be given in writing.
Severance Pay
Severance pay, also known as compensation for termination, is typically due to an employee upon the termination of their employment contract, particularly in cases of termination without just cause or collective dismissal. The calculation of severance pay is based on the employee's length of service and their base salary.
The standard formula for calculating severance pay is often based on a certain number of days' or months' salary per year of service. While specific rates can vary based on the type of termination and applicable laws or agreements, a common reference point involves a calculation related to days of salary per year of service.
For instance, a common calculation method involves:
- A certain number of days of base salary for each year of service.
- This rate may be higher for the initial years of service and potentially decrease slightly for subsequent years, or remain constant.
The total severance amount is capped at a specific number of months' salary or years of service, as defined by law. It is crucial to use the employee's base salary for this calculation and prorate for incomplete years of service.
Grounds for Termination
Employment contracts in Cabo Verde can be terminated based on various grounds, which are broadly categorized as termination with just cause and termination without just cause. The grounds for termination significantly impact the required procedure and the employee's entitlement to severance pay.
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Termination with Just Cause: This occurs when the employee commits a serious offense or breach of contract that makes the continuation of the employment relationship impossible. Examples include:
- Serious disciplinary misconduct (e.g., theft, insubordination, violence).
- Repeated unjustified absences or lateness.
- Serious breach of duties or obligations.
- Significant and persistent poor performance after warnings.
- Damage to company property caused intentionally or through gross negligence. Termination with just cause, if proven and procedurally correct, generally does not entitle the employee to severance pay.
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Termination Without Just Cause: This refers to termination initiated by the employer for reasons not directly related to the employee's fault. Examples include:
- Redundancy due to economic, technological, or structural reasons (collective dismissal or individual redundancy).
- Termination during the probationary period (subject to specific rules).
- Termination for objective reasons permitted by law but not constituting employee misconduct. Termination without just cause typically requires the employer to pay severance compensation and adhere to specific procedural requirements, including notice periods.
Procedural Requirements for Lawful Termination
Adhering to strict procedural requirements is essential for a lawful termination in Cabo Verde, particularly when terminating with just cause or due to redundancy. Failure to follow the correct process can render a dismissal unlawful, even if the grounds for termination were valid.
Key procedural steps often include:
- Notification of Intent: The employer must formally notify the employee in writing of the intention to terminate the contract, outlining the specific grounds and facts supporting the decision.
- Employee's Defense: The employee is typically given a period (e.g., 5 working days) to present a written defense or explanation regarding the allegations or reasons for termination.
- Investigation/Hearing: The employer may conduct an investigation or hold a hearing to consider the employee's defense and gather further information.
- Final Decision and Written Notice: After considering the defense, the employer makes a final decision. If the decision is to terminate, a formal written termination notice must be issued to the employee. This notice must clearly state the effective date of termination and the definitive grounds for dismissal.
- Severance Payment: If severance is due (e.g., termination without just cause), it must be calculated correctly and paid to the employee along with other final payments (e.g., outstanding salary, pro-rata holiday pay).
Common procedural pitfalls include failing to provide written notice, not clearly stating the grounds for termination, not allowing the employee sufficient time to respond, or failing to pay due severance and final entitlements.
Employee Protections Against Wrongful Dismissal
Cabo Verdean labor law provides significant protections to employees against wrongful or unfair dismissal. A dismissal is considered wrongful if it is based on unlawful grounds or if the correct legal procedures are not followed.
If an employee believes they have been unfairly dismissed, they have the right to challenge the termination through legal channels, typically starting with an attempt at conciliation and potentially escalating to labor court.
In cases of proven wrongful dismissal, the court may order the employer to:
- Reinstate the employee: The employee is returned to their position with payment of back wages from the date of dismissal.
- Pay compensation: If reinstatement is not feasible or desired by the employee, the employer may be ordered to pay significant compensation to the employee. This compensation is often higher than the standard severance pay for termination without just cause and aims to cover damages suffered by the employee.
The burden of proof in termination cases often lies with the employer to demonstrate that the dismissal was based on valid grounds and that all legal procedures were strictly followed. Certain categories of employees, such as pregnant employees or employee representatives, may have additional protections against dismissal.
