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the employee may be due to professional incompetence or physical
incapacity. For instance, the continued ill health may be accepted as
physical incapacity whereas continued unsatisfactory performance or
inability of the employee to work according to requirements of job may
be accepted as a professional incapacity. The valid reasons and espe-
cially underperforming is not clearly regulated under the legislation and
the details of its implementation are constructed by the court decisions.
As stated by the 9th Civil Chamber of High Court of Cassation in
several decisions, the criteria for underperforming must be based on
objective principles for a just termination of the agreement on valid
reasons. Pursuant to the judicial precedents, the criteria must be deter-
mined being particular to that work place and the underperforming
shall be evaluated considering also other employees at the same work
place. The criteria must be, indeed, realistic and reasonable for a duly
termination of the agreement. As a main requirement by the courts, it
should be stated that the criteria must be determined before the termi-
nation and the employee must be notified by these criteria. Yet, is not
possible to terminate the agreement on the basis of incapacity of the
employee of which the employee is not aware of.
It should be also added that, sole existence of a valid criteria and
of the fact that the employee is underperforming, shall not be sufficient
for termination of the employment agreement. Hence, the underper-
forming of the employee should cause negative effect for conduct of
the work in the work place. This requirement arises from the justifica-
tion of the Art. 18 of LA which defines valid reason as “the reasons
which have negative effects on conduct of the work and work place and
which are not as serious as the reasons stated in Art. 25 of LA.” Also
the precedents of the High Court of Cassation require existence of neg-
ative effect for a just termination of the agreement on valid reasons.
Conclusion
The incapacity of the employee and their underperformances as a
valid reason for termination of the agreement is not explained in detail
within the legislative texts. Therefore, existence of valid performance
criteria and subsequently existence of a just termination of the agree-
ment shall be evaluated separately for each case considering the prece-
dents of the courts.
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NEWSLETTER 2012