Resignation from a fixed-term contract

Resignation from a fixed-term contract

Swiss law recognises two main categories of employment contract: fixed-term contracts (CDD) and open-ended contracts (CDI). A fixed-term contract is one whose duration is agreed in advance, for a fixed or determinable period, and which automatically terminates on expiry without the need for notice. A permanent contract remains in force as long as one of the parties has not terminated it. It should be noted that if the parties continue their relationship at the end of a fixed-term contract without signing a new contract, the contract is transformed into a fixed-term contract. The legal rules applicable to these two types of contract are different, so it is important to be aware of them before any commitment is made. An employee who signs a fixed-term contract cannot terminate the employment relationship before the end of the contract. The same applies to the employer. A fixed-term contract cannot therefore be terminated unilaterally before its term by either party, which rules out the possibility of the employee resigning at any time, as you might envisage, for example to take up a more interesting post. The only exception to this rule is the possibility of terminating an employment contract with immediate effect where there are good grounds for doing so. Article 337 of the Swiss Code of Obligations (CO) states that just cause includes all circumstances which, according to the rules of good faith, do not allow the person giving notice to be required to continue the employment relationship. The law does not provide a more precise definition of these circumstances, which may be set out in detail in an applicable contract or collective agreement. It should also be noted that the party at fault in a situation of immediate termination must compensate the other party for the damage it causes. For example, if an employee rightly resigns because the employer does not comply with the terms of the contract, the employer will owe the employee his or her salary until the end of the contract. On the other hand, if the employee leaves for personal reasons, article 337d of the Swiss Code of Obligations stipulates that in such a case, the employer is entitled to compensation equal to one quarter of the monthly salary, while retaining the possibility of demanding compensation for any additional damage suffered.