Among the ways an employee can end an employment contract is a little-known procedure: termination for just cause. It also exists in French law on a principle similar to Portuguese law. Known in France as “prise d’acte de rupture du contrat de travail”, it allows an employee in either country to terminate immediately because the employer has failed to fulfil fundamental contractual or employment law obligations. In Portugal it is rooted in Articles 394 onwards of the Labour Code; in France it has developed mainly through case law.
Article 394 of the Portuguese Labour Code lists just causes, giving employees greater legal certainty. Examples include culpable failure to pay wages on time, inadequate workplace health and safety conditions, and attacks on physical or moral integrity. In France, practitioners must consult case law rather than an exhaustive list. The grounds are comparable to those in Portugal, and the key criterion is the seriousness of the employer’s breach. Employees should therefore check the validity of their grounds beforehand, or risk the court finding the termination unlawful.
In both France and Portugal, if just cause is not proved, the employer is entitled to compensation for the unserved notice period, generally limited to the basic salary and seniority supplements for the missing period. In Portugal the employer may also claim, where applicable, damages arising from failure to observe notice or a contractual commitment to remain with the company. Conversely, an employee who proves just cause is entitled to compensation. Article 396 of the Portuguese Labour Code generally provides between 15 and 45 days of basic salary and seniority supplements per year of service, depending on pay and the degree of unlawfulness of the employer’s conduct. In France, compensation depends on whether the termination has the effects of a void dismissal or a dismissal without real and serious cause.
French legislation prescribes no particular formalities beyond the case-law requirement to communicate termination directly to the employer. A registered letter with acknowledgement of receipt is advisable for evidence. In Portugal, employees must notify termination in writing, stating the facts justifying it, within thirty days of learning of them. The employer must bring a claim challenging its lawfulness within one year of termination. The limitation period in France is also one year.
Dr. Pedro Emanuel de OLIVEIRA
Lawyer