Extraordinary termination of an employment contract for serious misconduct by the employer

Extraordinary termination

The concept of extraordinary termination of an employment contract is an important legal mechanism in employment law that allows an employee to terminate their employment contract, and thus their employment relationship, in the event of serious breaches of obligations by their employer, by unilateral declaration of will, with the right to severance pay and compensation. Article 111 of the Employment Relationships Act (ZDR-1) specifies in detail which cases of serious misconduct by the employer allow the employee to give extraordinary notice of termination.

Extraordinary termination of the employment contract for misconduct by the employer thus has a significant impact on working conditions. Employees are increasingly aware of their rights and of the possibility to take action when their rights are violated. This also increases the responsibility of employers to fulfil their obligations towards workers and to comply with employment legislation.

Examples of serious misconduct by the employer

Recently, there has been an increase in the number of cases where employers are late in paying wages. Wages are often paid in several instalments after the due date, and in some cases employees do not receive their wages at all. The amendment to the ZDR-1D has provided for the right to extraordinary termination by the employee also in cases where the employer fails to pay wage compensation, and not only in cases where the employer fails to pay wages.

Such practices by employers constitute serious breaches of obligations and justify workers to give extraordinary termination of their employment contract. In all cases, the employment relationship is terminated immediately, without period of notice, and the worker is entitled to severance pay and compensation for loss of pay during the notice period.

Extraordinary termination procedure

Before giving an extraordinary termination, the employee must inform the employer in writing of the breaches and request that they be remedied. He or she must also inform the Labour Inspectorate of the breaches. If the employer fails to remedy the breaches within three working days, the worker may give extraordinary termination within 30 days.

Employer’s liability for damages

If the employer still owes the employee payments after the extraordinary termination, the employee must take judicial action to recover the debt. Article 135 of the Employment Relationships Act provides that a pay slip is an authentic instrument on the basis of which the employee may bring a direct enforcement action without bringing an action before the labour court.

Payment of debts after termination 

Even if the employer settles arrears, including wage arrears, recourse payments, untaken leave and any compensation claims, after receiving an extraordinary termination notice, this does not affect the lawfulness of the termination. The courts have clarified that the written warning is only intended to inform the employer of the breaches, not to remove the reason for the termination.

More information and legal advice

Križanec & Partners Law Firm in Slovenia has extensive experience in the field of employment law. Our lawyers provide expert advice and legal representation to employers and employees in all employment law proceedings. For further information please contact our employment law experts, Attorney at law Dinar Rahmatullin and Attorney at laws Janja Končan. We also invite you to read on our website the key changes introduced by the latest amendment to the ZDR-1, including important changes to ordinary termination of an employment contract for reasons of misconduct.