Termination without specified grounds ruled unlawful

employment termination

The Taicang Municipal Court in Jiangsu Province recently upheld a wrongful termination claim from an employee who was summarily dismissed without being given a reason for the termination.

The employer argued that it had terminated the employee for disciplinary violations. The employer said that it had not stated the termination grounds (i.e., misconduct) in the termination notice because it did not want to negatively affect the employee’s employment prospects in case a prospective employer would have asked to see the termination notice. So the employer sent a unilateral termination notice only stating the termination date and asking the employee to complete separation formalities and work handover procedures. The employee rejected the termination notice and filed a wrongful termination claim with the court.

The count ruled that the termination was unlawful because the employer did not meet its burden to prove the unilateral termination was based on legal grounds. In ruling that the employer had not met its burden of proof, the court also considered it significant that the employer did not follow the common practice of including the termination grounds in the termination notice. Thus the court ordered the employer to pay wrongful termination compensation to the employee.

Business Law Digest is compiled with the assistance of Baker McKenzie. Readers should not act on this information without seeking professional legal advice. You can contact Baker McKenzie by e-mailing Danian Zhang (Shanghai) at danian.zhang@bakermckenzie.com