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Home Work life guide page Termination of employment Cancellation of an employment contract

Cancellation of an employment contract

Cancellation of an employment contract means that the employment relationship is terminated immediately without a period of notice. An employer may terminate an employment contract only for very weighty reasons. The employee has the right to cancel the employment contract with immediate effect if the employer seriously violates or neglects its obligations related to the employment contract, law or essentially the employment relationship. 

The grounds for cancellation must be so serious that, due to the conduct of the opposing party, the employer or, correspondingly, the employee cannot be required to continue the employment relationship even for the duration of the notice period. The underlying idea is that the conduct of one party violates the other party so deeply that they cannot reasonably be expected to tolerate the breach of contract, but have the right to cancel the contract immediately. The Act does not include a concrete list clarifying the grounds for cancellation, because the aim has been to guide employers to terminate employment relationships primarily by dismissal. 

Contrary to other grounds for termination, deeming the employment contract cancelled does not require that the other party’s views have to be heard.

Deeming a contract cancelled

Unauthorised absence from work is one of the most common grounds for cancelling an employment contract. The employer may deem the employment contract as cancelled if the employee has been absent from work or the workplace for a minimum of seven days without giving the employer a valid reason for the absence. If the seven-day period includes a lot of days off, e.g. due to public holidays, they shall extend the required time period. In order for an absence to be allowed, there must be an acceptable reason for the absence and the employer must be notified of the absence. If it has not been possible to notify the other party of the absence due to an acceptable obstacle, the cancellation of the employment contract will be revoked. The application of this provision requires continuous absence, and other days than the employee’s working days cannot be taken into account when calculating the seven days required for cancellation.

During the trial period, the employment contract can be cancelled by both parties.