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Understanding Termination Rules in Global Employment Contracts

Ending an employment relationship is always a sensitive subject. Ending it across borders introduces another layer – maybe several. When companies hire globally, knowing how to part ways with team members respectfully and legally is not just thoughtful, it’s required. One misstep and suddenly, a company is up against steep fines, reputational risk, and sometimes, court battles that seem to go on forever.

This article takes a careful look at the rules and practices around global employee termination laws, running through the main concepts, key differences by country, and practical advice for companies aiming to expand or scale internationally. It also covers how EWS supports compliant, ethical exits, focusing on notice periods, severance, and probation – those topics that are a little uncomfortable, but absolutely necessary.

Why global termination rules matter so much

Imagine hiring your first employee in a new country. You’re excited, optimistic, and sure you’ve ticked every administrative box. But then, a year later, you need to restructure and let someone go. Suddenly, you’re in unfamiliar territory. Even experienced HR teams can find themselves asking – are we following the right process here? Is this legal? Is this fair? When in doubt, there’s always a chance that things could turn costly.

What makes global termination different from domestic? Well, almost everything. Believe it or not, there are countries where a handshake is enough, and others where every step must be documented, signed, and rubber-stamped. Even the definition of “cause” varies from one jurisdiction to the next.

Global compliance starts long before the last day of work.

That’s why EWS makes compliant offboarding a key part of its solutions, addressing the nuances of local employment practices and legal requirements. It allows organizations to focus on their growth, confident that their employee exits meet every local standard.

Core concepts in termination

Global employee termination rules rarely fit a single pattern. Here are the basic elements that come up, just about everywhere, even if the details are different:

• Notice periods: How long in advance must either party inform the other?
• Severance: Is there a right to compensation? How is it calculated?
• Probation: Are rules different at the start of employment?
• Cause vs. no cause: Does the employer need a reason? What qualifies as “fair” or “gross” misconduct?
• Fixed-term and open-ended contracts: Do the rules differ depending on the contract?
• Local documentation/filing: Are there requirements for how the exit is handled administratively?

Without an understanding of these elements for each country, companies may risk legal action, sudden costs, and a damaged employer brand. So let’s walk through the main pillars.

Notice periods around the world

The idea behind notice periods is pretty universal: give employees a fair warning before letting them go. Yet, how long “fair” is depends very much on location, work history, and sometimes company policy.

Europe’s layered approach

Many European countries have intricate systems of notice periods tied directly to length of service. Take Sweden, for example. Notice periods range from 2 months for employees with a tenure of 2–4 years, up to 6 months for those with over 10 years on the job, according to comparative notice period data.

Similarly, Turkey’s legislation sets scalable notice periods – 2 weeks for employees with up to 6 months of service, 4 weeks for up to 1.5 years, 6 weeks up to 3 years, and 8 weeks for over 3 years. It’s systematic but also, sometimes, restrictive.

Looking further, research notes that in some jurisdictions, the minimum can start at 30 days and extend to 90 days if the employee has exceeded 20 years in service (country-specific notice requirements).

Asia’s written clarity

Countries like China specify the notice period in law. In China, employees generally must give 30 days’ written notice, or just 3 days if they are within probation. Employers, in turn, should also give 30 days’ written warning or a similar payment in lieu, depending on the grounds for termination (China labor law summary).

Thailand mandates 60 days in advance, unless the employer is willing to pay the equivalent in compensation – a straightforward rule, but one with strict penalties for missing paperwork or delayed payment (Thailand employment compliance reporting).

Statutory vs. contractual notice

One area that can confuse even seasoned managers is the difference between statutory notice and contractual notice. Sometimes, the employment contract promises longer (or even shorter) notice than what the law says. In most jurisdictions, the higher standard prevails. Yet, failing to clarify this in employment contracts can lead to disputes. EWS works with clients to draft global employment contracts that balance local law and company policy, preventing misunderstandings before they start.

Severance: how much, when, and why?

Severance pay: it can be a safety net, a legal requirement, or a goodwill gesture, depending on where you are. Yet, the rules are anything but uniform.

Severance by length of service

Severance entitlements usually grow with an employee’s tenure. In Thailand, for instance, staff receive from 30 days’ salary (for 6 months–1 year) to 300 days’ wage (for over 10 years), a very staggered approach (severance practices overview).

In Europe and South America, severance can be even more generous, especially following mass layoffs or if the company triggers “no-cause” termination for economic reasons. However, failing to pay the right severance, or paying it late, can open companies to claims, penalties, or, in extreme cases, the freezing of local bank accounts.

Not knowing the local rules can cost more than any planned severance.

How severance is calculated

The formula for severance pay usually depends on these factors:

• Length of continuous employment
• Last drawn monthly or weekly wage
• Reason for termination (redundancy, no-cause, misconduct, retirement, etc.)
• Any collective agreements or company policies in force

Sometimes, the law sets a minimum (as in Turkey or France), but employers may need to pay more, depending on local collective bargaining agreements or long-standing company customs.

EWS helps companies forecast severance liabilities before entering a new market, which can be the difference between a manageable restructuring and an unexpected budget blowout.

Probation: different rules for new starters

Many countries permit a distinct set of rules for employees on probation. Usually, the threshold for termination is lower and notice requirements are shorter – sometimes, almost non-existent.

China’s probationary notice period: only 3 days required from either side (official labor guideline).

In contrast, some European states limit the use of extended probation periods, reflecting a trend towards greater employee protections. According to European Union Directive 1999/70/EC, nations must prevent abuse of successive, temporary contracts and limit how often and how long probation can truly last (EU fixed-term contract rules).

Termination with and without cause

Perhaps the most delicate question a global employer can face is, “Do I need a good reason to let someone go?” In some places, the answer is yes. In others, less so.

Termination for cause

This happens when an employee breaches their duties – by stealing, repeated poor performance (documented, never assumed), or gross misconduct. Jurisdictions such as Germany or France demand a robust paper trail and often a formal warning process before an employee can be dismissed for cause.

An interesting twist is how “serious cause” is interpreted. What one country calls insubordination, another may see as a difference of opinion.

Termination without cause

Some nations, including the United States, allow for “at-will” employment, but this is the exception, not the rule. Most global markets require a justified reason for ending employment, especially after the probation period.

EWS frequently counsels clients on documenting just-cause terminations, ensuring that reasons are legally sound, behavior is fairly documented, and requisite warnings have been given. This lowers risk for costly disputes and appeals.

Special rules for fixed-term and open-ended contracts

Temporary, seasonal, or fixed-term contracts seem simple – but international rules often complicate the story. The European Union, for instance, actively discourages chaining fixed-term contracts together to avoid employee protections, mandating maximum durations and restriction on renewals (European fixed-term directive).

Permanent, or open-ended, contracts usually promise greater protection, including longer notice and higher severance, unless the employee is at fault. Once again, the definition of “fault” is a local issue.

Key country snapshots

It would take days to cover every country, but here’s a quick overview of key regions:

• Sweden: Notice periods of 2–6 months based on tenure. Cause is strictly defined. Unions often involved in exits.
• Turkey: Notice is 2–8 weeks. Severance based on service years. Documentation is critical.
• China: 30 days’ written notice; probation just 3 days. Good cause usually required by law.
• Thailand: 60 days’ notice or equivalent payment; severance can rise to 300 days’ pay.
• France and Germany: Require documented cause, especially post-probation. Lengthy notice and potentially generous severance packages.
• United Kingdom: Statutory minimum notice is one week per year of service, up to 12 weeks.

If you’re sending employees abroad, or planning your first international hire, knowing these local differences will shape every step of your employee lifecycle. If you want a comprehensive look at pre-hiring requirements, the compliance checklist for international hiring in 2025 is a useful reference.

How EWS manages compliant global exits

EWS views compliant global exits as more than just paperwork – they’re a sign of a company’s integrity. By partnering with local labor experts and using technology to track legal developments, EWS guides clients from initial discussions through final payments, making sure everything is by the book.

• Pre-termination audit: Review the contract, past warnings, payment history, and all local requirements.
• Notice and documentation: Draft, serve, and log notices in line with statutory and contractual demands, every time.
• Severance and benefits: Run calculations for all due compensation using correct local formulas – not global “averages.”
• Physical and digital offboarding: Handle the return of equipment, revoke system access, and confirm final payments, always with an audit trail.
• Employee communications: Share communication templates and help teams deliver news with empathy and clarity.

As an extra layer of compliance, EWS maintains detailed records in case of dispute, tying up loose ends that can otherwise lead to misclassification risk. For a helpful guide on this topic, see legal risks of misclassification.

Lessons from experience: EWS case notes

It isn’t always the law that gets companies in trouble – sometimes, it’s a failure to communicate. EWS has found that being transparent about the reasoning behind a termination, even if uncomfortable, is better in the long run. It’s not unusual for clients to want to act quickly, especially during restructuring, but taking the time to document every step makes future audits and challenges much smoother.

For companies experimenting with global expansion through employer of record solutions, having EWS as a partner adds a safeguard against legal exposure, missteps, and inconsistent offboarding practices.

Empathy and rigor can coexist in global offboarding.

Common compliance mistakes and how to avoid them

Mistakes in the termination process are more common than many think. Through supporting clients, EWS sees a few errors more often:

• Underestimating notice or severance: Assuming “at-will” is the global default can lead to major liability.
• Inadequate documentation: No paper trail of warnings or performance issues, making cause impossible to prove.
• Improper contract types: Using repeated fixed-term contracts in violation of the law, particularly in Europe, leads to automatic conversion to permanent status.
• Overlooking local filings: Some regions require government notification or redundancy registration, which is often overlooked.
• Relying only on templates: Generic HR templates rarely account for country-specific requirements.

The safest move is to involve local or global experts, like EWS, early in the planning – not just after problems arise. See how you can weigh PEO versus EOR models for your first overseas hire.

Global mobility and complexity in terminations

International assignments – sending employees to work in new jurisdictions – add a further set of rules for terminations. Cross-border exits may involve tax clearances, relocation costs, and visa cancellations. Employers can face significant delays if exit paperwork is incomplete, particularly in regulated sectors.

Key challenges identified by clients include unclear assignment handover, remote final payments, and compliance with local end-of-assignment tax reporting. EWS supports clients as they navigate global assignments and related global mobility challenges, ensuring smooth, fully-compliant exits.

Do’s and don’ts for international employers

If you remember nothing else, try this list:

• Do check local law and update contracts every year.
• Don’t assume templates or home-country policies apply elsewhere.
• Do give clear, timely, written notice – on paper and by email.
• Don’t ignore employee requests for clarification or documentation.
• Do keep detailed records (warnings, appraisals, resignation letters).
• Don’t leave offboarding logistics (access, benefits, equipment) until the last day.

Conclusion

Global employee termination rules are anything but simple, yet with the right planning, companies can approach exits with confidence and care. EWS has guided organizations through the maze of notice, severance, and compliance in over a hundred jurisdictions, providing steadiness at moments that could quickly turn uncertain. From the compliance checklist at the start of hiring, to the final exit paperwork, expertise and empathy matter.

Next time your organization contemplates an international hire, or faces the possibility of letting someone go far from home, the difference between risk and reassurance comes down to process. EWS delivers that peace of mind – making sure that every contract, every notice, every exit is not just by the rules, but also in the spirit of fairness.

The end of one chapter can be the respectful start of another.

To discover how EWS can assist with your global workforce solutions, or to ask about compliant hiring, onboarding, and offboarding services, reach out to us today. The right partner brings certainty into every employment relationship.

Frequently Asked Questions

What are global employee termination laws?

Global employee termination laws refer to the legal requirements that govern how and when an employer can end an employment relationship, varying across countries and even regions. These legal frameworks cover procedures such as notice periods, severance pay, permissible reasons (“cause” or “no cause”), and the documentation required. They are designed to ensure that terminations are fair, transparent, and in line with local labor protections, making noncompliance quite risky for employers.

How do termination rules vary by country?

Termination rules differ greatly by country, often depending on employment type, time served, and the jurisdiction’s protection of employee rights. Some countries mandate long notice periods based on seniority, while others require specific processes or even third-party review (such as union involvement). Severance can range from a few weeks to several months’ pay. Some places allow for at-will terminations, but most require concrete justification. For instance, Sweden and Turkey use service-dependent notice periods, while China and Thailand dictate strict notice or compensation policies. Not knowing the rules often leads to legal issues.

What is just cause for termination globally?

Just cause (or “cause” for termination) typically refers to a legally recognized reason for dismissing an employee, such as severe misconduct, frequent unexcused absences, theft, fraud, workplace violence, or inability to perform job duties despite warnings. The definition and the evidence needed to prove cause are highly localized. For instance, some European countries demand a formal warning process and substantial documentation. The absence of just cause where it’s required can mean invalid termination and trigger legal claims.

How much notice is required internationally?

The length of notice required depends on local law and sometimes company policy but ranges from as little as a few days (during probation in China) to several months (up to 6 months in Sweden). Notice periods can vary based on years of service, job title, or cause for termination, and the required format (verbal vs. written, notification to authorities) also changes. Sometimes, an employer can choose to pay in lieu of notice rather than wait out the period with the employee remaining on payroll.

What are common severance practices worldwide?

Worldwide, severance practices are designed to cushion employees from immediate financial hardship after job loss. Most often, the compensation is based on the employee’s length of service and last wage. For example, in Thailand, severance ranges from 30 to 300 days’ wages depending on years of service. Several other countries impose mandatory severance pay, while some only require it in cases of redundancy, economic downturns, or company closure. Severance can also be influenced by collective agreements and sector-specific customs.