The unilateral termination of the labor contract of the employer is always a topic in the labor relation. Due to several shortcomings stipulated in the Labor Code 2012, the Labor Code 2019 (effective from 01 January 2021) has many amendments and supplements to this issue so that it becomes appropriate and feasible when applying in practice.

Article 36 of the Labor Code 2019 provides three additional cases where the Employer has the right to unilaterally terminate the labor contract, including (i) the employee reaches the retirement age stipulated by law; (ii) the employee fails to go to work without acceptable excuses from or more than 05 consecutive working days; and (iii) the employee fails to provide truthful information during the conclusion of the labor contract that affects the recruitment.

Besides, the Labor Code 2019 has added two cases that allow the employer to unilaterally terminate the labor contract without notifying the employee in advance, in particular:

1.   After 15 days from the expiry date of the suspension of the labor contract, the Employee does not present at the workplace; and

2.   The Employee quits the job without reasonable reasons and consents from or more than 05 consecutive working days.

Allowing the employer to unilaterally terminate the labor contract without prior notice to abovementioned cases is to solve difficulties which the Employer may face since, according to the Labor Code 2012, the only way to terminate the labor contract with the employee in such cases is to conduct the discipline in the form of dismissal, which requires complicated orders and procedures.

Along with the expansion of the employer’s right to unilaterally terminate the labor contract, the Labor Code 2019 also expands the subject that Employer is not allowed to unilaterally terminate the labor contract. While the Labor Code 2012 only stipulates that the employer is not allowed to unilaterally terminate the labor contract with the female employee when taking leave to enjoy maternity benefits or raising children under 12 months of age, the Labor Code 2019 provides that the employer is not entitled to unilaterally terminate the labor contract for both male and female employees if they are taking maternity leave or raising children under 12 months of age. This is considered as a progressive regulation, which enhances gender equality in labor relation. 

The Labor Code 2019 has made progressive regulations and more favorable conditions for the employer to unilaterally terminate the labor contract and execute its the labor management rights but still ensure the status of stability and harmony in labor relation and the right of employee.