Employees leave a company for all sorts of reasons. Both employees and employers are able to terminate contracts in order to sever their relationships with one another. The ending of an employment period does not always have to be a sad or bitter affair: there are plenty of mutual reasons why a company might lose an employee.
In recent years, companies all over the world have been caught in the maelstrom of the ‘great resignation’. This mass wave of employee resignations has many possible causes. The arrival of COVID 19 and the changing of perspectives experienced as a result are likely to have been the main catalyst for this mass movement in the labor market. Employees are – rightfully – demanding adequate benefits, hybrid working models, and an increase in pay in line with inflation.
This mass shake-up in the field of employment has provoked more scrutiny regarding end of contract agreements and conditions. Here is a very brief guide to the most common reasons for the end of an employment period.
Fair Dismissal
Fair dismissal can take place for several reasons. Failure to abide by a contract can lead to dismissal. Repeated breaking of company codes of conduct can lead to dismissal. Theft or industrial espionage can lead to dismissal. An employer must have sufficient evidence and solid reasoning before firing an employee. If they do not, they may unfairly dismiss that employee and can face the consequences in civil court. Most companies try and fire as few people as they can – it is usually far more hassle than it is worth and leaves everybody with a rather bad taste in their mouths.
Redundancy
Redundancy is defined as a dismissal that takes place for the reason that has nothing to do with the individual being dismissed. People being made redundant are often entitled to payments after they have finished working – reflecting the fact that the dismissal was not their fault. Companies make employees redundant in order to avoid dissolving or becoming bankrupt. They may also make employees redundant to effectively automate elements of their work – although this is an extremely controversial and morally grey practice.
Retirement
Employees are entitled to retire at any point during their careers. There is no longer a legal requirement age, although state (and most private) pensions only begin paying out after a person has reached the age of 66.
The outsourcing company HR Dept in Oxford specializes in taking the responsibility away from the internal members of a company when it comes to the completion of retirement paperwork. Many businesses choose to outsource HR tasks like this – which can be very time-consuming and distract members of an internal HR team from more pressing tasks.
In the US, employers cannot force people to retire due to their age. This is a positive change, meaning that older people can still work if they need or want to without being forced out. This legal assurance has some caveats, but most employees are not forced into mandatory retirement at any age.
Resignation
Employees can resign if they give an adequate amount of notice. Poor pay, poor benefits, better opportunities elsewhere, and a bad work-life balance have all been blamed for the rise in contract terminations via resignation. The length of time that they have to work will usually depend on their contract unless working conditions are untenable.
End Of Contract
Employees and employers are bound by their contracts together. At the end of the period outlined in this contract, an employer has two options. Firstly, they can renew the contract – potentially with increased pay and benefits to keep an employee on the side. Secondly, they can choose not to renew the contract. If the latter option is chosen by a company, an employee will be given notice and asked to find new employment. As you might imagine, this can sometimes lead to some contention. Although a company does not have to do so, it is generally considered only to fail to renew a contract if genuine reasons can be given to employees.
Contracts that have a specific end date are known as fixed-term contracts. In the US, there are specific laws that ensure the transparency of these contracts. The ending of a fixed-term contract without renewal is treated like a dismissal under the law and is therefore subject to the same scrutiny regarding fairness. Employees can still seek compensation for unfair dismissal even if this dismissal is the result of a non-renewal of a fixed-term contract.
