NATIONAL LABOUR MARKET POLICIES

Basic Information Reports

2.2.5.Dismissal

Termination of employment contracts

The termination of open-ended employment contracts is based on the right of each party to such a contract to express the one-sided desire to terminate it for the future.

In the case of contracts specifically drawn up for dependent employment, the employer terminates the contract by dismissing the employee.

The termination of open-ended employment contracts is regulated in principle by:

a) Law 2112/20, as amended by Law 4558/30, regulating termination of the employment contracts of white-collar workers;

b) Royal Decree 16 of 18.7.1920, which extends the regulations contained in Law 2112/20 to the termination of the employment contracts of blue-collar workers, craftspersons and domestic employees, as amended and extended by § 43 of Law 1836/89. The regulations contained in this legislation were extended and modified by Law 3198/55, as amended and extended by § 5 of Law 435/76. The dismissal procedure, the severance pay to which the worker is legally entitled and the type and payment of this sum depend on the status of the dismissed worker (white-collar worker, blue-collar worker or craftsperson).

Dismissal of white-collar workers

The employer has two possibilities for dismissing a white-collar worker in the private sector: dismissal with notice or instant dismissal (without notice).

Dismissal with notice

The employer may dismiss the employee after expiry of a certain period of notice, the length of which depends on the employee's length of service. In this case, the employer is obliged to inform the employee in writing that the employment relationship will be terminated on expiry of the period of notice.

Severance pay for dismissal with notice

The amount of severance pay to which a dismissed private-sector employee is entitled and the respective period of notice are laid down in various laws (2112/20 and 4558/30 in conjunction with 3198/55) and depend on the length of service of the dismissed employee with his/her last employer.

Under the terms of these regulations, the period of notice and the amount of severance pay for white-collar workers are equal to:

Length of service	Amount of severance pay	Period of notice
2 months - 1 year	½ one monthly salary	1 month
1 year - 4 years	½ two monthly salaries	2 months
4 - 6 years	½ three monthly salaries	3 months
6 - 8 years	½ four monthly salaries	4 months
8 - 10 years	½ five monthly salaries	5 months
10 years	½ six monthly salaries	6 months

For white-collar workers whose length of service exceeds 10 years, the amount of severance pay increases by half a monthly salary for each additional year of service. The severance pay may on no account exceed more than half the total salary for two years. The maximum period of notice is 24 months for workers with 28 years of service.

Dismissal without notice

Employers who so desire may, in principle, dismiss a white-collar worker without notice. In this case, the employer is obliged by virtue of Law 2112/20 to provide severance pay equal to the following amounts:

Severance pay for dismissal without notice

The amount of severance pay depends on the length of service and on the salary of the worker:

Length of service	Amount of severance pay
2 months - 1 year	1 monthly salary
1 year - 4 years	2 monthly salaries
4 - 6 years	3 monthly salaries
6 - 8 years	4 monthly salaries
8 - 10 years	5 monthly salaries

White-collar workers with over ten years of service receive six monthly salaries plus an additional monthly salary for each additional year of service. The amount may, however, on no account exceed the total salary for two years, i.e. 24 months.

Dismissal of blue-collar workers, craftspersons and domestic employees

Dismissal without notice is the only possible form of dismissal in the case of blue-collar workers, craftspersons and domestic employees. Thus, the statutory severance pay is paid out at the same time as the written termination of the employment contract.

Severance pay for dismissed blue-collar workers, craftspersons and domestic employees

The amount of severance pay granted on dismissal to blue-collar workers, craftspersons and domestic employees depends on the length of service and is equal to:

Length of service	Amount of severance pay
2 months - 1 year	5 daily wages
1 - 2 years	7 daily wages
2 - 5 years	15 daily wages
5 - 10 years	30 daily wages
10 - 15 years	60 daily wages
15 - 20 years	90 daily wages
over 20 years	105 daily wages

Formal dismissal procedure

In order that dismissal of white-collar workers, blue-collar workers and craftspersons on open-ended employment contracts of at least two months' duration is legally valid, the following procedures must be observed:

a) written notice of termination;

b) payment of the statutory severance pay;

c) registration of the employment relationship of the dismissed worker in the wage lists kept by the Social Security Office or the worker's insurance scheme (§ 2 of Section 4 of Law 2556/97).

In addition, the OAED must be notified of the dismissal. The dismissal is not invalidated by failure to inform the OAED, but this leads to a fine for the employer concerned.

Dismissal without severance pay

Workers may be dismissed without severance pay in the case of the following exceptions to the general principle:

a) if the employment relationship has lasted less than two months;

b) if the worker has been charged with violating the law in the execution of his/her work or with a crime. However, if the worker is acquitted by a court order or court judgement of the offence with which he/she was charged, the employer is obliged to pay the statutory severance pay;

c) if the dismissal is due to the enterprise ceasing operations due to force majeure. If the employer is insured against the circumstances in question, he/she is obliged to pay two-thirds of the statutory severance pay.

Two important presidential decrees should also be mentioned:

- Presidential Decree (PD) 572/88 on the maintenance of the rights of the workers on conveyance of enterprises.

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