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The Federal Supreme Court on employment termination with immediate effect

If an employment contract is terminated without notice, this often results in legal disputes. The Federal Supreme Court has clearly stated its position on dismissal without notice in two cases.

For important reasons, an employment relationship can be terminated with immediate effect (Art. 337 para. 1 CO). Good cause is deemed to exist if the party giving notice of termination cannot reasonably be expected to continue the employment relationship until the end of the regular period of notice (Art. 337 para. 2 CO). This requirement is considered to be fulfilled if the relationship of trust between employer and employee has been destroyed or at least profoundly shaken. In two groundbraking decisions, the Federal Supreme Court has expressed its opinion on the permissibility of dismissal without notice.

Termination with immediate effect due to failure to report illness

In the decision BGE 4A_521/2016, the Federal Supreme Court had to assess whether the employee’s failure to report illness was a sufficient basis for immediate dismissal. The dispute arose after a security guard at a track construction site was absent from his work without excuse. In this case, the Federal Court affirmed the permissibility of dismissal without notice. The reason given for this decision was that the security guard of a track construction site had a responsibility function, as he is responsible for the safety of the other employees. In addition, the track workers were dependent on the appearance of the safety attendant. Only if he appeared could the other workers carry out their work. Furthermore, the Federal Court of Justice argued that the safety guard had violated his duty of loyalty because he had not reported his absence by 8 a.m. of the corresponding day as required by the employee handbook. In view of these circumstances, the failure to report his absence was classified as grave misconduct, which justified immediate dismissal.

No postponement of reasons for dismissal

In its decision BGE 4A_109/2016, the Federal Supreme Court stated that only events that occurred before the termination without notice can be considered as good cause. Furthermore, the party giving notice of termination must already have been aware of this reason at the time the termination was discussed. For example, it should not be possible to dismiss an unpleasant employee without notice and to construct a reason for the termination afterwards. The postponement of reasons for termination is generally inadmissible. Only if an important reason was not known to the person giving notice at the time of dismissal can he or she subsequently invoke it. The dismissing party must therefore not have had prior knowledge of the good cause. If a dismissal without notice is based on a subsequent reason for termination, however, it is necessary to critically examine whether this reason would have been suitable to shake the relationship of trust in the long term if it had been known. 

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