Supreme Court limits damages for unjustified termination of fixed-term contracts to one month's pay if substantive grounds exist.
Legislator summary
AI generatedThe Supreme Court remanded the case to the District Court to recalculate damages for the unlawful termination of a ten-year fixed-term employment contract. The plaintiff argued that the contract should be treated as indefinite, but the employer failed to state specific reasons for termination in the written notice. The Court held that while the employer violated formal requirements by omitting reasons, the termination was substantively justified due to the employee's poor conduct and inability to perform managerial duties. Consequently, the compensation award was capped at the statutory maximum of one month's pay rather than the plaintiff's requested three months.
Legislator headnote
AI generatedArt. 471 k.p.; Art. 8 k.p.: If a termination of a fixed-term contract is substantively justified despite the employer failing to state reasons in the notice, the compensation for unlawful termination shall not exceed the remuneration for the statutory notice period.