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The employer must establish a real and serious reason to dismiss an employee.
It may be:
An employer may not dismiss an employee without a legally valid cause.
Dismissal may be based on personal grounds (e.g. disciplinary dismissal, dismissal due to professional inadequacy, dismissal due to incapacity) or economic grounds (e.g. economic difficulties, technological changes), or subject to specific conditions, without stating a specific motive.
An employer may terminate an employee's employment contract if there is a justified reason for doing so, namely:
The stages in the individual dismissal procedure are as follows:
The dismissal letter must be a registered letter whose receipt must be acknowledged by the employee, signed by either a legal representative of the firm or a person duly empowered by a legal representative, and who must belong to the company.
Applicable collective bargaining agreements can provide for a more favourable timeframe and / or procedure.
The letter must explicitly mention the grounds for dismissal. There are other mandatory provisions such as the possibility of choosing to benefit temporarily the supplementary health care scheme in force in the company, etc.
The grounds set out in the dismissal letter may be specified by the employer or at the employee’s request after the letter has been sent. If the employee does not make such a request, the letter’s lack of an adequate explanation will not in itself support a finding that the dismissal lacks real and serious cause, but will merely entitle the employee to compensation of no more than one month’s salary.
A special procedure (possible involvement of the works council, see below,
meeting and notification of the dismissal) applies in the case of a dismissal for economic reasons or when the dismissal concerns a ‘protected employee’ (e.g. members of the social and economic council, and trade union delegates notably).
A specific procedure prior to the dismissal exists for employees who have been recognised as physically incapable of performing their work by a labour doctor (redeployment obligation, possible involvement of the social and economic council, etc.).
For a dismissal based on a disciplinary reason, the employer should move rapidly as the procedure must begin within a few weeks of the employer becoming aware of the reason for dismissal and no more than two months after the discovery of the facts.
The employee must be notified of the dismissal in writing.
Termination must be in written form and given to the employee in person. It must contain the reasons for termination, an elaboration of the reasons and set out the employee’s right of appeal and the time limit for submitting the employee’s response prior to terminating the employment. This decision is given in the form of a decision by the director and is final.
The notice period is set by the applicable collective bargaining agreement and the Labour Code, and generally lasts between one and three months. The contract may be terminated without notice in the event of gross misconduct or intentional misconduct.
In the event of dismissal, the law provides that an employee is entitled to a notice of a duration which varies depending on his seniority as follows:
For any dismissal, the employer may choose whether the employee works during the notice period.
In either case, employee is entitled to receive the same salary, including any benefits.
The notice period depends on the ground for dismissal. If the ground for termination is one of the following:
Then, the employer is obliged to warn the employee in writing of the reasons for the employment termination, give evidence of those reasons, and allow the employee at least five working days to respond to the warning.
In addition, the employee has the right and duty to remain at work for at least 30 days from the day they receive notice that their employment contract is to be terminated, i.e. a termination notice.
The social and economic council must be informed and consulted (with an advisory but formal vote of its members) when a mass redundancy is planned, or for the planned dismissal of a protected employee or physically disabled employee.
Works councils do not exist in Monaco. A staff representative (if established) must be properly informed prior to a collective redundancies.
Montenegrin Labour Law does not recognize work councils. The closest institution to a work council is a trade union (see information below).
When a company employs more than 50 workers, trade unions may be involved in a mass redundancy procedure to negotiate an ‘employment saving plan’.
No involvement for dismissals.
The representative trade union must be invited to give its opinion on the redundancy programme draft if it becomes necessary to implement a redundancy programme and give its complaints to the Employment agency regarding redundancy proceedings.
This is required when dismissing ‘protected employees’ and now the validation or homologation of the employment saving plan is also required for mass redundancy procedures.
Mandatory for employees with legal protection because of their private life or their mandate.
This protection applies to staff representatives, union delegates, pregnant women, employees taking maternity leave, paternity leave, adoption leave or family support leave, members of the Labour Court, harassment referents.
The relevant Labour Authority has to be informed of projected collective redundancies prior to their dismissal, and grant prior approval.
No approval from the state authority is necessary according to the Montenegrin Labour Law.
Different procedures apply according to the company’s workforce and the number of employees concerned (the procedures are ‘lighter’ in small companies that dismiss fewer than ten employees).
The main principles are the same:
In case of mass redundancies (more than ten employees in a company employing at least 50 employees):
The implementation of collective redundancies is mainly regulated by law and the National Collective Bargaining Agreement, which imposes some procedural steps prior to implementing any such decision.
Three main issues must be considered regarding the preparation and implementation of a collective social plan:
regarding the decision to restructure, its motivation, its implementation and the measures taken by the employer to minimise any adverse impacts on employees;
If, within a 90-day period, the employer plans to conduct a collective dismissal of 20 or more employees, he must:
Conduct consultations and consider the opinion of the Union, or Employee representatives if there is no union, in order to reach an agreement regarding the lack of need for those employees’ work and reach a solution. The employer must respond to these in written form and consider them in order to reach a mutually beneficial solution; the consultation must last at least 30 days. The employer must inform the employment agency about the consultation and give all relevant information regarding the consultation in writing. Employees cannot be terminated before 30 days have elapsed after the consultation conclusion is delivered to the Employment agency.
The employer must deliver to the Union or Employee representatives, in written form, and for the purpose of conducting consultations, the following:
The term ‘summary dismissals’ has no real meaning in France. Dismissal without a notice period is only possible where there has been a serious breach, but even in that case, the form described above for dismissal procedure, including the preliminary meeting and registered letter, must still be applied. In case of dismissal without notice, the employee has no dismissal indemnity or notice period indemnity, because there is no notice period. Such dismissed employees are still entitled to unemployment insurance benefits, however. The dismissal procedure must begin within a few weeks of the employer becoming aware of the reason for dismissal and no more than two months after the discovering of the facts.
Dismissal without notice is only possible in case of gross misconduct. In such a case, the employee receives no dismissal indemnity or notice period indemnity. The employee is still entitled to unemployment insurance benefits.
Montenegrin Labour Law does not permit dismissal without notice. Notice has to contain the reasons for dismissal, evidence indicating that the conditions for dismissal have been obtained and a deadline for responding to the notice. The deadline may not be shorter than 5 days.
The amount of damages depends on the actual loss suffered by the employee. For dismissals notified on or after 24 September 2017, the ordonnance n° 2017-1387 provides that the damages have a preset minimum and a maximum amount depending on the employee’s length of service. The ordonnance also stipulates specific lower minimum amounts for companies that usually employ fewer than 11 employees, but the maximum remains identical.
In some circumstances, the dismissal will be void, allowing the employee to request reinstatement. (These circumstances may include collective redundancies without a social plan, dismissal after an occupational injury or in discriminatory dismissals, or dismissal of a protected employee without state authority authorisation). In such a case, the compensation cannot be less than six months’ salary.
Should the employer dismiss an employee on personal or economic grounds without a valid cause, the employer would have to pay a dismissal indemnity.
In addition, the employee could claim damages for injuries suffered due to his / her wrongful dismissal.
If a court determines during the proceedings that the employee’s employment relationship has been unlawfully terminated, the court will decide that the employee is to be reinstated and compensated for damage. The employee’s right to compensation for financial damage is to be calculated as the amount of the lost salary and all other earnings he/she would have earned at work, in accordance with the law, collective agreement and employment contract, as well as payment of contributions for mandatory social insurance.
Dismissal indemnity is payable unless the dismissal is due to gross misconduct or intentional misconduct. The amount payable is mainly set by the collective bargaining agreement but must not be less than 1 / 4 of the monthly salary per year of service for the first ten years of service, plus 1 / 3 of the monthly salary for each year of service after ten years. Indemnity is also payable for unused accrued holiday entitlement and for the notice period if the employer chooses to release the employee from performing it.
Dismissal indemnity is payable unless the dismissal is for gross misconduct. The amount payable is mainly set by the collective bargaining agreement, but must not be less than the French legal dismissal indemnity (since 27 September 2017: 25% of the monthly gross salary until ten years of seniority and one third of the monthly salary as of the tenth‘s year). A higher indemnity is payable in case of dismissal without a stated motive. Indemnity is also payable for unused accrued paid holidays and for the notice period if the employer chooses to release the employee from performing it.
If the employment contract is terminated because a certain job becomes unnecessary, the employer must pay severance pay as set by the labour rulebook/collective agreement or employment contract.
Severance pay is given to employees who have worked for that employer longer than 18 months.
The severance pay is given as the sum of one third of the employee's average gross salaries paid over the previous six months, for each year of work with that employer, or 1/3 of the average monthly salary without taxes and contributions in Montenegro, if this is more favourable for the employee.
Severance pay cannot be lower than three average monthly salaries without taxes and contributions in the past 6 months, or three times the average monthly salary without taxes and contributions in Montenegro, if this is more favourable for the employee.
A non-competition clause is only valid if provided in the work contract, and if:
This clause can be waived by the employer in the letter of dismissal or according to the provision of the applicable collective bargaining agreement and / or employment contract.
The examination of the terms of the applicable collective bargaining agreement is key on this matter.
Non-competition clauses are enforceable in Monaco provided they are appropriately restricted.
A non-competition clause must comply with five cumulative conditions:
Independent consideration is required for a non-competition clause.
Contractual non-competition clauses may contain a number of jobs which the employee cannot do in his/her own name and on his/her own behalf (i.e. not in his/her capacity as an employee of the company) or for a different entity without the approval of the employer. If the employee violates this obligation, he/she may be terminated.
Post-contractual non-competition restrictions may last for a maximum of two years after employment is terminated. However, such restrictions are only valid if the employer undertakes to pay monetary compensation to the employee in the employment agreement.
Specific and restrictive rules and procedures apply in the case of pregnant women, women on and returning from maternity leave, young fathers, and employees recovering after a work-related accident or suffering from a work-related illness. Women on maternity leave cannot be dismissed during this period.
Since 2008, a new means of termination has been introduced, namely “by mutual agreement”. This new possibility is called ‘rupture conventionnelle’ (mutual termination of the employment contract). The termination is agreed by both employer and employee and there is no cause or reason to demonstrate.
The employee is entitled to unemployment insurance benefits and dismissal indemnity provided by law or the applicable collective bargaining agreement (or more if agreed).
A strict procedure including preliminary meetings and consideration periods should be followed (both parties have the benefit of 15 calendar days to retract, from the date on which the form is signed); a specific form must be filled in and signed by both parties.
The specific form must be sent to the state authorities for agreement. The state authorities have a 15-open day period to review the form. Within these 15 days, the state authorities can agree to the termination, disagree or stay silent (silence amounts to agreement). However, the state authorities must expressly agree for protected employees. Otherwise the termination is void.
Since September 2017 it has been possible for the employer to negotiate a collective agreement through a ‘rupture conventionnelle collective’ (mass mutual termination of the employment contract) with trade unions. Such an agreement can only implement voluntary departures and thus excludes any dismissals designed to eliminate jobs. This new method of terminating contracts is entirely excluded from the rules governing economic dismissals. The labour administration is informed as soon as negotiations to conclude such an agreement start and reviews the agreement’s contents before validating it.
Not applicable.
The employment termination resolution is void if, on the date the resolution is passed, the employer was aware of the existence of the grounds for using pregnancy leave, maternity leave, or leave for the special care of a child, or if the employee, within 30 days of termination of employment, informs the employer of the existence of these circumstances and submits the appropriate certificate from an authorized physician or other competent authority.
Also, an employer may not terminate employment, or put an employee in a disadvantageous position in any other way, because of his/her status or activities as an employees’ representative, trade union member, or because of his/her participation in trade union activities.
As for disabled persons, the employer is obliged to make it possible for any disabled employee to perform work suited to his/her working capability. Also, the employer must find another suitable job for any employee who is compromised by his/her disability in his/her job. Only if the employee refuses to accept such a job may the employer serve an employment termination resolution. If the employer cannot provide the disabled employee with a job suitable for his/her working capability, then such an employee will be considered redundant.
The company may generally revoke the appointment of the managing director without cause, unless stated otherwise in the by-laws of the company or the resolution of appointment. However, a fair reason is legally required in certain forms of companies (e. g. the civil form or commercial forms such as certain limited companies (‘SA’) or limited liability companies (‘SARL’)).
A company may generally revoke the appointment of the managing director without cause, unless stated otherwise in the by-laws of the company or the resolution of appointment. This is particularly the case for limited companies (‘SA‘). However, a just cause is legally required in limited liability companies (‘SARL’) when revoking a managing director who is also a shareholder of the company. In any event, revocation must follow mandatory steps to be declared valid.
An employer may terminate an employee's employment contract if there is a justified reason for doing so, namely:
A resolution taken by the shareholders or board of directors, depending on the form of the company and the internal organisation of the management. The managing director must be notified in writing of the revocation, and the change of managing director must be published in a public Corporate Register.
A resolution is taken by the shareholders and / or board of directors, depending on the form of the company and the internal organisation of the management. The managing director must be given the opportunity to explain himself or herself and the revocation must not be made vexatiously.
Termination must be in written form and given to the employee in person. It must contain the reasons for termination, an elaboration of the reasons and set out the employee’s right of appeal and the time limit for submitting the employee’s response prior to terminating the employment. This decision is given in the form of a decision by the director and is final.
There is no notice period, except where one is provided by the by-laws of the company or in the resolution of appointment of the managing director.
No notice period, except where one is provided by the by-laws of the company or in the resolution of appointment of the managing director.
The notice period depends on the ground for dismissal. If the ground for termination is one of the following:
Then, the employer is obliged to warn the employee in writing of the reasons for the employment termination, give evidence of those reasons, and allow the employee at least five working days to respond to the warning.
In addition, the employee has the right and duty to remain at work for at least 30 days from the day they receive notice that their employment contract is to be terminated, i.e. a termination notice.
No.
No involvement.
Montenegrin Labour Law does not recognize work councils. The closest institution to a work council is a trade union (see information below).
Not applicable.
No involvement.
The representative trade union must be invited to give its opinion on the redundancy programme draft if it becomes necessary to implement a redundancy programme and give its complaints to the Employment agency regarding redundancy proceedings.
No.
For limited liability companies (‘SARL’), appointment of a new director is subject to government approval. For all companies, the change of director must be registered in the Monaco Companies Register.
No approval from the state authority is necessary according to the Montenegrin Labour Law.
Not applicable.
Not applicable.
If, within a 90-day period, the employer plans to conduct a collective dismissal of 20 or more employees, he must:
Conduct consultations and consider the opinion of the Union or Employee representatives if there is no union, in order to reach an agreement regarding the lack of need for those employees’ work and reach a solution. The employer must respond to these in written form and consider them in order to reach a mutually beneficial solution; the consultation must last at least 30 days. The employer must inform the Employment agency about the consultation and give all relevant information regarding the consultation in writing. Employees cannot be terminated before 30 days have elapsed after the consultation conclusion is delivered to the Employment agency.
The employer must deliver to the Union or Employee representatives, in written form, and for the purpose of conducting consultations, the following:
Not applicable.
Not applicable.
Montenegrin Labour Law does not permit dismissal without notice. Notice has to contain the reasons for dismissal, evidence indicating that the conditions for dismissal have been obtained and a deadline for responding to the notice. The deadline may not be shorter than 5 days.
Damages may mainly be claimed:
Damages may be claimed, mainly:
If a court determines during the proceedings that the employee’s employment relationship has been unlawfully terminated, the court will decide that the employee is to be reinstated and compensated for damage. The employee’s right to compensation for financial damage is to be calculated as the amount of the lost salary and all other earnings he/she would have earned at work, in accordance with the law, collective agreement and employment contract, as well as payment of contributions for mandatory social insurance.
There is no mandatory severance pay for the capacity as director, unless stated otherwise in the by-laws of the company or in the resolution of appointment of the managing director.
Not applicable.
If the employment contract is terminated because a certain job becomes unnecessary, the employer must pay severance pay as set by the labour rulebook/collective agreement or employment contract.
Severance pay is given to employees who have worked for that employer longer than 18 months.
The severance pay is given as the sum of one third of the employee's average gross salaries paid over the previous six months, for each year of work with that employer, or 1/3 of the average monthly salary without taxes and contributions in Montenegro, if this is more favourable for the employee.
Severance pay cannot be lower than three average monthly salaries without taxes and contributions in the past 6 months, or three times the average monthly salary without taxes and contributions in Montenegro, if this is more favourable for the employee.
The terms of any non-competition clause must be agreed between the parties. If the scope of the clause is too wide (according to its geographic area, its length, or the activities it concerns), its validity may be challenged.
Non competition clauses are only valid insofar as they specify a restricted application in time and space. They also have to include financial compensation in order to compensate the director for the loss of revenue they cause him or her. If the clause does not include those elements, it is null and void. In that case, the director may still be held liable for unfair competition towards the company if it is demonstrated that the director resorted to fraudulent practices intended to disturb the company’s activity such as denigrating it or employing key members of its staff.
Contractual non-competition clauses may contain a number of jobs which the employee cannot do in his/her own name and on his/her own behalf (i.e. not in his/her capacity as an employee of the company) or for a different entity without the approval of the employer. If the employee violates this obligation, he/she may be terminated.
Post-contractual non-competition restrictions may last for a maximum of two years after employment is terminated. However, such restrictions are only valid if the employer undertakes to pay monetary compensation to the employee in the employment agreement.
The director may also be an employee. In this case, a proper dismissal process will have to be implemented in addition to the revocation process and corresponding dismissal indemnities paid.
Not applicable.
The employment termination resolution is void if, on the date the resolution is passed, the employer was aware of the existence of the grounds for using pregnancy leave, maternity leave, or leave for the special care of a child, or if the employee, within 30 days of termination of employment, informs the employer of the existence of these circumstances and submits the appropriate certificate from an authorized physician or other competent authority.
Also, an employer may not terminate employment, or put an employee in a disadvantageous position in any other way, because of his/her status or activities as an employees’ representative, trade union member, or because of his/her participation in trade union activities.
As for disabled persons, the employer is obliged to make it possible for any disabled employee to perform work suited to his/her working capability. Also, the employer must find another suitable job for any employee who is compromised by his/her disability in his/her job. Only if the employee refuses to accept such a job may the employer serve an employment termination resolution. If the employer cannot provide the disabled employee with a job suitable for his/her working capability, then such an employee will be considered redundant.
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