In Myanmar, the labor law mandates a minimum notice period for employers terminating an employment contract, with some exceptions.

Minimum Notice Period

According to the Employment Contracts Act (ECT) 2017, employers must provide a minimum of 30 days' written notice to employees before terminating their employment, unless the termination falls under specific categories. This applies to all situations except the probationary period.

Probationary Period Notice

During the probation period, the employer is required to provide only 7 days' written notice before terminating the employee's contract. However, the employer can choose to pay one month's salary in lieu of providing notice.

Exceptions to Notice Period

There are limited exceptions where employers are not obligated to provide a notice period. These include situations where the employee commits gross misconduct. The employment contract can also outline additional reasons for dismissal without notice, but these reasons must be clearly defined and adhere to Myanmar's labor laws.

Importance of Written Notice

The written notice serves as a crucial document during termination. It should clearly state the termination date and the reason for termination, if applicable.

In Myanmar, employees may be entitled to severance pay under certain termination circumstances. The entitlement and calculation of severance pay are determined by the Employment and Skills Development Law (ESDL) 2013 and the Ministry of Labour, Immigration, and Population (MOLIP) Notification No. 84/2015.

Applicability of Severance Pay

Severance pay is mandatory in the following termination scenarios:

• If the employer breaches the contract (ESDL, Section 5(d)).
• If the employer permanently ceases operations (ESDL, Section 5(d)).
• If the workplace is forced to close due to unavoidable events, such as natural disasters (ESDL, Section 5(d)).
• In the unfortunate event of the employee's passing, their beneficiary is entitled to severance pay.

Calculation of Severance Pay

Severance pay calculations are based on the employee's length of service and their final salary. MOLIP Notification No. 84/2015 outlines the following scale:

| Length of Service | Severance Pay | | --- | --- | | 6 months - 1 year | Half of monthly salary | | 1 - 2 years | 1 month's salary | | 2 - 3 years | 1.5 months' salary | | 3 - 4 years | 3 months' salary | | 4 - 6 years | 4 months' salary | | 6 - 8 years | 5 months' salary | | 8 - 10 years | 6 months' salary | | 10 - 20 years | 8 months' salary | | 20 - 25 years | 10 months' salary | | Over 25 years | 13 months' salary |

Key Points to Remember

• Severance pay is calculated based on the employee's basic salary and does not include overtime or other allowances.
• Severance pay is not required in cases of resignation or dismissal for misconduct.

The termination of an employee in Myanmar must adhere to labor laws to ensure a fair and legally sound process.

Grounds for Termination

Employers must have a justifiable reason for terminating an employee. Legally valid reasons for termination in Myanmar include:

• Misconduct: Gross misconduct, as outlined by Myanmar's labor laws or the employment contract, allows for dismissal.
• Underperformance: Repeated instances of poor performance despite warnings or provided opportunities for improvement.
• Redundancy: Economic factors or changes in business operations can lead to redundancies.
• Breach of Contract: Violation of the employment contract by the employee.
• Completion of Fixed-Term Contract: Employment naturally terminates at the end of a fixed-term contract unless specified otherwise.

Written Notice

Unless termination involves gross misconduct, the Employment Contracts Act (ECT) 2017 mandates employers provide written notice. The notice period is typically 30 days but may be reduced during the probationary period. The notice must include:

• Date of termination
• Reason for termination (if applicable)

Exit Documentation

Upon termination, employers must provide the following:

• Certificate of Employment: Details the employee's start and end dates, as well as their job title.
• Tax Clearance: Confirms tax obligations have been met.

Termination Dispute Resolution

If an employee disputes the termination, Myanmar has processes for dispute resolution:

• Workplace Coordination Committee (WCC): An internal committee within workplaces that attempts to resolve disputes through mediation.
• Labor Courts: If unresolved at the WCC level, disputes can be escalated to labor courts for legal resolution.

It is always recommended to have a well-defined termination policy within employment contracts that aligns with Myanmar labor laws. Always consult legal counsel for guidance on complex termination scenarios.