Sources of regulation
The Model Harmonisation
Act regarding Termination of Employment (“the Model Act”), drafted with
the assistance of the International Labour Office (ILO) for the countries
of the Caribbean Community (CARICOM), [1] was adopted by the Standing Committee
of Ministers responsible for Labour in April 1995.
The main objectives of this Model Act, as enshrined
in its Section 1, are to give effect to the provisions of the ILO Termination
of Employment Convention, 1982 (No. 158), to protect employees against
unfair dismissals, as well as to establish fair and equitable procedures
for termination of employment relationship.
The Model Act was
influenced by legal provisions in the CARICOM countries. [2] At
the same time, since its adoption, the Model Act has, in its turn, influenced
legislative reforms in the region and
has been used as a model to a greater or lesser extent for legislation
in such countries as Barbados, the Bahamas (Employment Act, 2001), Belize,
Grenada (Employment Act, 1999), Guyana (Severance Pay Act, 1997), Saint
Lucia, and Saint Vincent and the Grenadines (Protection
of Employment Act, 2003). [3]
In 1995, the CARICOM
Standing Committee also adopted the Model Harmonisation Act regarding Equality
of Opportunity and Treatment in Employment and Occupation (“the Model Equality
Act”), the Model Harmonisation Act regarding Registration, Status and Recognition
of Trade Unions and Employers’ Organisations (“the Model Recognition Act”),
and in 1997 was added the Model Law on Occupational Safety and Health and
the Working Environment. These Model Acts are commented on below only so
far as their provisions affect termination of employment. The legislation
governing termination of employment in Jamaica is addressed separately (see summary for Jamaica).
The ILO Termination
of Employment Convention, 1982 (No. 158) was ratified in 2000 by Saint Lucia and in 2002 by Antigua and Barbuda.
In addition, in
all of the CARICOM members, case law (based upon either the common law
or civil law systems), individual contracts of employment and, in some
cases, collective agreements concluded through collective bargaining are
additional sources of regulation on termination of employment. [4]
Scope of legislation
The Model Act defines
“employee” broadly to mean a person who offers his or her services under
a “contract of employment”, and to include managerial employees and dependent
contractors. “Employer” means any person, enterprise or public authority,
who or which employs any person under a contract of employment or uses
services of a dependent contractor, a commission agent or a contract worker.
“Contract of employment” is defined to include any contract, express or
implied, written or oral, and to include contracts of apprenticeship and
probation. Likewise, “employment” is defined to include part-time employment,
contracts for services and commission agents (sec. 2, Model Act).
Part IV “Termination
of Employment” of the Model Act applies to all employees employed for an
unspecified period of time, and to employees employed for specified periods
within the duration of the employment contract. It only excludes fixed-term
employees upon the expiry of the term of the contract and probationary
employees upon the expiry of the probationary period (sec. 14, Model Act).
The Model Act sets
out minimum standards which can be improved upon through collective bargaining,
other forms of negotiation, or arbitration award (sec. 3, Model Act).
Contracts of employment
Sec. 4(2) of the
Model Act sets out the different forms of employment contracts concluded:
- without
reference to limit of time;
- for
specified periods or tasks; and
- for probationary period.
Employment contracts,
which purport to be concluded for a fixed term or a specific task for a
period over two years of continuous employment and which concern a post
connected with a normal and permanent activity of the employer, are deemed
to be concluded for an indefinite duration (sec. 4(6), Model Act).
The probationary
period may last for up to three months and may be extended upon agreement
of an employer and an employee for a period not to exceed six months in
total. During the probationary period, the employment relationship may
be terminated at any time by either party for any reason and without notice
(secs. 4(7) and 15, Model Act), provided the probationer has, during the
probationary period, been given a fair appraisal.
Termination of employment
Employment contracts
concluded for a fixed period of time or a specific task terminate respectively
on expiry or completion (secs. 4(4) and 4(5), Model Act).
Employment relationship
terminates, other than at the initiative of the employer, on the winding
up (insolvency) of an employer; however, this is treated as a dismissal
for the purpose of redundancy payments (sec. 24, Model Act).
The death of
an employer, whose personal or legal position constituted the basis of
the employment contract, causes termination of the employment relationship
one month from the date of the employer’s date (sec. 25, Model Act).
In case of the transfer
of a business, employment relationship with the successive employers is
deemed continuous, unless the employment contract has been formally terminated
and severance pay has been paid (sec. 13, Model Act).
Dismissal
Sec. 14 sets out
the basic principle of the Model Act: an employer can not terminate employment
relationship, unless there is a valid reason for such termination connected
with the capacity or conduct of the employee or based on the operational
requirements of the enterprise, and provided there is compliance with notice
requirements.
The Model Act also
sets out a list of invalid reasons for termination (sec. 16), including,
among others:
- an
employee’s race, sex, religion, colour, ethnic origin, national extraction,
indigenous status, social origin, political opinion, disability, family
responsibilities and marital status (these grounds are also prohibited
under the Model Equality Act, subject to specified bona fide occupational
qualifications (secs. 4, 5 and 6, Model Equality Act));
- an
employee’s age (subject to national law and collective agreement provisions
on retirement);
- a
female employee’s pregnancy or a reason connected to pregnancy;
- an
employee’s exercise of his or her trade union membership or other industrial
rights (the Model Recognition Act, sec. 51, also prohibits dismissals
based on trade union membership or activity);
- an
employee’s temporary absence from work due to illness or injury within
leave entitlements;
- being
diagnosed with HIV (unless the employee is a health care worker);
- absence
because of compulsory military service or other civic obligation;
- removing
oneself from a work situation presenting an imminent or serious danger
to life or health;
- participation
in legal industrial action; or
- the filing of a complaint against
an employer involving violations of law and regulations.
There is a constructive dismissal, if the employee terminates the contract
of employment without notice because of the employer’s conduct which has
made it unreasonable for the employee to continue the employment relationship
(sec. 17, Model Act).
Employers may terminate
employment relationship without notice or payment of any severance payment
if an employee is guilty of serious misconduct of such a nature that it
would be unreasonable to require the employer to continue employment. The
summary dismissal can occur for serious misconduct which is restricted
to be directly related to the employment relationship and to have a detrimental
effect on the business (sec. 18, Model Act).
Employers may also
terminate employment based on poor performance or misconduct, after following
prescribed procedures (sec. 19, Model Act, see below), or on the grounds
of redundancy, again after following prescribed procedures (sec. 20, Model
Act (see below)).
Notice and prior procedural safeguards
Under sec. 26 of
the Model Act, the employer is entitled to dismiss an employee through
giving the following minimum periods of notice in writing:
- one
working day if the employee has less than one month of service;
- two
weeks for between one month and one year of service;
- one
month for between one and five years of service; and
- two months for more than five years
of service.
These periods of
notice may be improved upon by collective agreement or custom (secs. 26(2)-(3),
Model Act). The employer may, at his/her discretion, make a payment in lieu
of notice (sec. 27, Model
Act).
In case of misconduct
(not justifying summary dismissal), the employer is first required to give
the employee a written warning. If the employee is guilty of the similar
misconduct in the following six months, the employer may dismiss the employee,
provided the former acts within a reasonable period after knowing about
the misconduct (secs. 19 (1)-(3), Model Act).
An employer may
only terminate an unsatisfactorily performing employee if the latter has
been warned in writing of unsatisfactory performance and has had a reasonable
opportunity to improve his or her performance during the three months following
the warning. In addition, the employer has to provide the employee with
appropriate instructions to correct his/her unsatisfactory performance
(secs. 19 (4)-(6), Model Act).
Termination of employment
relationship due to redundancy (sec. 20, Model Act) is only possible if
the employer has consulted beforehand with the recognized trade union,
or if none exists, the employees’ representative, about the contemplated
redundancies and possible means of averting or minimizing their adverse
effects (consultation with recognized unions is also required by sec. 37(1)
of the Model Recognition Act).
Severance pay
Employees who are
terminated on the grounds of redundancy and who have completed at least
one year’s service are entitled to a severance payment of two weeks’ wages
for each of the first ten years of service, and three weeks’ wages for
each of the remaining years of service (sec. 33, Model Act).
Avenues for redress
Employees have the
right, within six months from the date of termination of employment, to
complain of unfair dismissal to the appropriate judicial body (sec. 30,
Model Act). The burden of proving a dismissal was fair rests on the employer
(sec. 31, Model Act). If a dismissal is found to be unfair, the employee
is entitled to one or more of the remedies, such as reinstatement, re-engagement
or compensation, taking into account the wishes of the employee and the
employer, as well as particular circumstances of the case (sec. 32, Model
Act). Compensation is not to be less than two weeks’ wages for every completed
year of service, or one month’s wages for each year of service for workers
with more than two years of service of seniority.
Further information
[1] The Caribbean Community (CARICOM), also called the Commonwealth
Caribbean, is a geographical and political grouping of 13 countries: Antigua and Barbuda,
the Bahamas, Barbados, Belize,
the Commonwealth of Dominica, Grenada, Guyana, Jamaica, Saint Kitts and Nevis, Saint Lucia, Saint Vincent, and
the Grenadines, Surinam,
and Trinidad and Tobago. Montserrat, a British Dependency,
is also a member of CARICOM. The British
Virgin Islands is an associate member.
[2] A report on the provisions existing in the CARICOM countries was
prepared by R.M. Antoine: The CARICOM Labour Law Harmonisation Report,
Sep. 1992.
[3] A study “Review and analysis of compliance with
CARICOM model labour legislation” has been under preparation in March 2007
(see the Web-site of the ILO subregional office for the Caribbean).
[4] An interesting example of collective agreements as a source of
regulation on termination of employment in the CARICOM States is the Protocol
on Job Security, agreed between the Barbados Employers’ Confederation,
the Barbados Hotel and Tourism Association and the Barbados Workers’ Union.
This Protocol, based on the principles enunciated in the Employment Policy
Convention, 1964 (No. 122), includes a wage freeze and the concept of gain-sharing
remuneration. It also specifies a procedure for employers to follow when
considering redundancies, including notice and consultation with trade
unions, making all efforts to avoid job losses and the adoption of “last
on, first off” as the (prima facie) guiding principle for redundancy selection.
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