How do I terminate my employment? Overview of options and practical advice

Terminating an employee's employment relationship can be a challenging topic both humanly and legally. Termination of employment by an employer is limited by law and therefore a number of rules must be followed. Find out how to properly terminate an employee and what your options are when doing so.

Termination options

1/ Termination agreement

This is the most flexible option, as both parties jointly agree to terminate their relationship. The advantage is that you do not need to include a reason for termination in the agreement (but you can add one if you want).

Another plus is that this type of termination is not tied to a notice period and the employment relationship can end immediately or on a specific date - but never retroactively. You can also agree any severance pay for the employee, this is then subject to the same levies as normal pay.

Although termination by agreement is very flexible, make sure you write everything down carefully and sign the document for both parties.

2/ Termination by the employer

Termination by the employer is a unilateral step that leads to the termination of the employment relationship and is only possible for the reasons set out in section 52 of the Labour Code.

The reasons for termination by the employer may be:

1. Dissolution of the employer or part of it (end of business)
2. Relocation of the employer or part of the employer (relocation of operations elsewhere)
3. Redundancy (abolition of a job)
4. Unsuitable health of the employee (must be confirmed by a medical report)
5. Maximum permissible exposure at the workplace (decision of the public health authority - e.g. maximum exposure to harmful substances)
6. Violation of the employee's obligations under the employment contract, employer's regulation, legislation
7. Unsatisfactory work performance (you must give the employee a letter of reprimand in the last 12 months and ask them to remedy the deficiencies)
8. Meeting the conditions for immediate dismissal (see point 3 below)

However, you cannot give notice to an employee if he or she is:

• in quarantine or on temporary disability which he or she has not deliberately caused;
• participating in a military exercise;
• released to perform a public function;
• the employee is pregnant or on maternity leave; the employee is on paternity or parental leave;
• temporarily unfit for night work on the basis of a medical opinion;
• a long-term care provider or caring for and treating a child under 10 years of age or another natural person under the Sickness Insurance Act.

However, these exemptions, which protect employees from termination, do not apply to situations where your company or a portion of it would be dissolved or relocated.

3/ Immediate termination of employment

You can only terminate your employment with immediate effect in really serious cases. The situation popularly known as "notice or dismissal by the hour" has its own clearly defined rules, for example:

• the employee has seriously violated work discipline (e.g. theft at the workplace) - in this case , any notice period and the right to severance pay are waived;
• the employee has been finally convicted of a deliberate criminal offence and sentenced to an unconditional prison term of more than 1 year or 6 months if the offence was committed in the course of or in connection with the performance of his/her duties.

You cannot immediately terminate the employment of an employee who is pregnant or on maternity leave, or an employee on paternity or parental leave.

4/ Termination after a specified period

When you enter into a fixed-term employment relationship with an employee, the employment relationship ends automatically at the end of the agreed period. It is advisable to inform the employee in writing in advance whether or not you will extend the contract. You have two options:

5/ Termination during the probationary period

You may terminate your employment without giving any reason during the probationary period, on any date. In this case, the employee is not entitled to severance pay and the relationship may be terminated immediately without notice.

The only exception is temporary incapacity for work, where you as the employer may not give notice during the first 14 calendar days of incapacity.

Termination of employment in a nutshell

Beware of the new Labour Code as of 1 June 2025

Since the beginning of June, an amendment to the Labour Code has entered into force which, among other things, regulates the area of termination or probationary periods. Specifically, the following changes apply:

• Start of the notice period immediately upon delivery - the notice period starts immediately upon delivery of the notice and lasts for 2 months. Previously, it did not start until the first day of the following month. If there is a breach of employment duties, it can only last for 1 month.
• Extension of the probationary period - the maximum length of the probationary period has been extended to 4 months by the amendment, and can now be up to 8 months for senior positions.

Things to remember when terminating employment

• The notice of termination must be in writing and include the reason for the termination. Moreover, you must clearly and specifically describe the reason; it is not possible to simply refer to the relevant paragraphs (the exception is termination by agreement, where you can do without a reason).
• You must deliver the notice - in person or by post - but always in the hands of the employee and with confirmation that the counterparty has received it (signature of the employee, delivery receipt, etc.).

What do I need to do after termination of employment?

• Issue the employee with a certificate of employment (credit slip) and be sure to give it to the employee.
• Account for any untaken leave; this is paid as part of the final salary.
• Make sure you return company property such as laptop, phone, car, chip, and sign handover reports on everything.
• Report changes to the Social Security and Health Insurance Companies.

Act humanely and according to the law

Your human approach to termination fundamentally affects how the employee perceives the whole process. Open communication should be the basis - don't surprise the employee with an unexpected decision, but share any reservations or changes in the company with them in a timely manner. This way, the parting can be polite and transparent. You will also reduce the likelihood that the dismissed employee will spread negative references about your company.

When a company behaves politely even in challenging situations, it contributes greatly to a good company culture and employee loyalty.

Let us help you with your payroll accounting

Dissolving an employment relationship entails a number of legal obligations and administrative steps. Leave your payroll to us and focus your business on what makes you money. Fill out the contact form below and we'll get back to you.

Contact information

Write to us and we’ll get back
to you within 24 hours.

+420 226 224 724

info@jake-james.cz

Revoluční 736/15, Praha 1

Follow us:

First name

Last name

Phone

E-mail

Message

I consent to the processing of my personal data

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Send