Global Termination Guide

Terminating an employee internationally carries statutory obligations that differ by 10x–30x across jurisdictions. Germany requires works council consultation and up to 12 months’ notice for senior roles; Brazil mandates a 40% FGTS penalty on the full fund balance; France imposes mandatory severance at 1/4 month per year of service. Getting termination wrong exposes you to reinstatement claims and regulatory penalties, not just notice pay.

The HR director at a UK fintech rang her global mobility lead on a Tuesday morning. A senior engineer in Lyon had been on a performance improvement plan for six weeks and the manager wanted to terminate by Friday.

The mobility lead asked one question: had a pre-dismissal meeting (entretien préalable) been scheduled with at least five working days’ notice, in writing, by registered post? It had not.

The manager had simply told the employee, verbally, that “things weren’t working out.” That single conversation had already breached French procedure.

By the time legal got involved, the company was looking at a wrongful dismissal claim with damages capped at around six months of salary, plus statutory severance the employee was now entitled to anyway, plus the cost of the procedural defect itself.

This is the texture of international termination. The mistake is rarely the decision to dismiss. The mistake is the assumption that domestic instincts translate.

They do not.

Notice periods, severance formulas, procedural sequencing, consultation duties, and the burden of proof shift sharply across borders, and several jurisdictions impose penalties that are genuinely punitive rather than merely inconvenient.

This guide walks through what changes, where your worst risk concentrates, and how to build a termination process that holds up when the employee files a claim against you.

Why does international termination need a completely different playbook?

In the United States, most employment is at-will. A manager can terminate without cause, without notice, and without severance, subject to anti-discrimination law and the terms of any contract.

That single fact distorts the mental model your US-headquartered leadership brings to international terminations, and it is responsible for a disproportionate share of compliance failures your team will encounter.

Outside the US, most jurisdictions require a valid reason for termination, statutory notice, statutory severance, and a documented procedure. Some require government or works council approval before your dismissal takes effect. The burden of proof typically sits on you as the employer.

The four shifts that catch domestic-trained HR teams

• Cause is required and must be documented. “Not a culture fit” is not a reason. Performance terminations require a documented improvement process. Redundancy terminations require evidence the role is genuinely redundant.
• Notice is statutory, not contractual. The contract can extend statutory notice but cannot reduce it. Paying in lieu of notice (PILON) is permitted in some markets and prohibited in others.
• Severance is formula-driven, not discretionary. The amount is set by law or collective agreement, calculated on tenure, base salary, and sometimes age.
• Procedure is the second battleground. Even where the reason is solid, a procedural defect (wrong notice format, missing meeting, inadequate consultation) can void the dismissal entirely.

The practical consequence: a termination that would take an hour in California can take eight weeks in the Netherlands and require a court filing. If your team operates in these markets, plan accordingly.

How much notice must you give, and how does it vary by country?

Notice period is the easiest variable for your team to get wrong because it scales with tenure in ways your contract often does not state explicitly. The statutory minimum applies regardless of what your contract says, and in several countries the contract can only lengthen it.

Indicative statutory notice ranges (employer-initiated)

• Germany: 4 weeks to end of 15th or last day of calendar month for under 2 years tenure, scaling to 7 months for 20+ years.
• France: 1 month for under 2 years, 2 months for 2+ years (CDI), longer under collective agreements.
• United Kingdom: Statutory minimum of 1 week per year of service, capped at 12 weeks. Most contracts specify 1 to 3 months.
• Netherlands: 1 month under 5 years, scaling to 4 months for 15+ years tenure.
• Brazil: 30 days base notice plus 3 additional days per year of service, capped at 90 days total.
• Spain: 15 days’ notice or pay in lieu for objective dismissals.
• Italy: Set by collective agreement (CCNL); typically 15 to 90 days depending on category and tenure.
• Australia: 1 to 5 weeks based on tenure and age (extra week if over 45 with 2+ years service).
• Singapore: Whatever the contract states, falling back to 1 day to 4 weeks based on tenure if silent.

The trap: your contract saying “1 month notice” in Germany is unenforceable for a 10-year employee whose statutory entitlement is 4 months. Pay the statutory amount or your dismissal date will be pushed forward by a labour court.

How is statutory severance calculated in each major market?

Severance interacts with notice pay, accrued leave, bonus pro-rating, and social charges. The headline number is rarely the full picture:

Statutory severance formulas in major markets

• France: 1/4 of monthly salary per year of service for the first 10 years, then 1/3 per year thereafter. A 12-year tenure on a €6,000 monthly salary produces (10 × 0.25 + 2 × 0.33) × 6,000 = €19,000 statutory minimum.
• Germany: No statutory severance for ordinary terminations, but 0.5 month per year of service is the social plan benchmark and often the negotiating anchor in a mutual termination agreement (Aufhebungsvertrag).
• Brazil: The headline penalty. FGTS contributions of 8% of monthly salary deposited monthly throughout employment, plus a 40% penalty on the entire FGTS balance for without-cause terminations. A 5-year tenure can easily produce a payout of 6 to 8 months of salary.
• Mexico: 3 months base salary plus 20 days per year of service, plus a seniority premium of 12 days per year (capped at 2× minimum wage).
• United Kingdom: Statutory redundancy pay only applies to redundancy. 0.5 weeks per year under age 22, 1 week 22 to 40, 1.5 weeks for 41+, capped at 20 years and a weekly cap (currently around £700).
• Netherlands: Transition payment of 1/3 month per year of service, calculated from day one of employment.
• Spain: 20 days per year of service for objective dismissals (capped at 12 months); 33 days per year for unfair dismissals (capped at 24 months).
• Italy: TFR (trattamento di fine rapporto) accrued throughout employment at roughly one month per year of service, paid out on any termination including resignation.

Brazil’s 40% FGTS penalty and Spain’s 33-days-per-year unfair dismissal formula are designed to make without-cause termination genuinely expensive. A finance team modelling a Brazilian dismissal as one month severance is wrong by an order of magnitude.

Which procedural steps are most likely to void a dismissal?

Procedural defects are often more expensive than substantively unfair dismissals because they are provable from documents alone. Three patterns create most of the risk:

Pre-dismissal meetings and written notice

France requires a formal pre-dismissal meeting (entretien préalable) with at least 5 working days’ notice by registered letter, followed by a 2-day reflection period before the dismissal letter can be sent. Spain requires written notice stating the specific cause.

Germany requires the works council to be consulted before the notice is issued (and the consultation must be substantively meaningful, not pro forma). Skip any of these and the dismissal is procedurally void regardless of how strong the underlying case is.

Government or third-party approval

The Netherlands requires UWV (the public employment agency) approval for economic dismissals or kantonrechter (subdistrict court) approval for performance dismissals, and the process takes 5 to 8 weeks.

Belgium has notification duties to regional authorities for collective dismissals. Mexico requires conciliation through the Centro Federal de Conciliación y Registro Laboral before any dismissal claim can proceed to court, and most parties settle there.

France requires authorisation from the labour inspector (inspecteur du travail) for protected employees such as works council members.

Collective consultation thresholds

Most European jurisdictions trigger collective consultation duties at relatively low thresholds. The UK’s 30-day consultation kicks in at 20 redundancies in 90 days, the 45-day version at 100. Germany’s social plan duty triggers at thresholds that scale with company size.

France’s plan de sauvegarde de l’emploi (PSE) triggers at 10 dismissals in 30 days for companies of 50+ employees and is procedurally heavy. Failure to consult does not merely delay the dismissals; it can void them entirely.

How does termination through an EOR actually work in practice?

When your employee is engaged through an Employer of Record, the EOR is the legal employer, not your company. This changes who does what, but it does not eliminate any of the underlying statutory obligations.

The cost still lands on you, the timeline still depends on the country, and the procedural risk still exists. What changes is execution.

The standard EOR termination flow

• Client gives 30 days notice to the EOR (on top of local statutory notice).
• EOR reviews the reason and confirms protected status (pregnancy, parental leave, union role, sick leave) and local procedure.
• EOR runs the local process and signs the termination letter as legal employer.
• Client funds the cost: notice pay, severance, accrued leave, and EOR admin fee.
• EOR handles deregistration under its own tax and social security registrations.

Where EOR terminations still go wrong

The EOR reduces procedural risk but not financial exposure or timeline. Netherlands still takes 5 to 8 weeks; Brazil still produces the 40% FGTS penalty.

The most common error is pre-announcing the termination to the employee before the EOR runs the local process. That breaks procedural sequencing. Always let the EOR control notification.

How do you build a termination process that protects the company?

Four disciplines separate companies that handle your terminations cleanly from those writing settlement cheques six months later:

1. Country playbooks, not generic policy

A single global termination policy is useless in practice.

Each country in your footprint needs a playbook covering: required reason categories, notice formula, severance formula, mandatory procedural steps, government or works council approvals, protected categories, claim windows, and standard settlement ranges.

Keep your playbook with HR or with your EOR partner. Update it annually for stable markets; quarterly for high-litigation ones.

2. Documented performance management

Almost every defensible performance termination has a paper trail: documented expectations, regular feedback, a formal improvement plan with measurable goals and a defined review window, and contemporaneous notes from each meeting.

Where your paper trail is missing, the dismissal will be defended on procedure or settled. Start your documentation 90 days before the termination, not the week of.

3. Single point of legal sign-off

Every international termination needs sign-off from in-country counsel or the EOR’s legal team confirming: valid reason, correct procedure, accurate calculations, no protected status. The cost of sign-off is small. The cost of skipping it is the wrongful dismissal claim.

4. Settlement budget set in advance

Most contested international terminations settle. Set your budget at 1.5 to 2 times statutory severance before the conversation. Negotiating without authority extends your timeline and raises the final figure.

Pre-termination checklist

• Reason for termination documented and falls within a legally valid category for the country.
• Performance documentation, where relevant, covers a minimum 60 to 90 day improvement window.
• Tenure, contract type, and protected status (pregnancy, parental leave, sick leave, union role) verified.
• Statutory notice calculated on tenure as of the proposed termination date.
• Statutory severance calculated, including any collective agreement uplift.
• Mandatory procedural steps mapped: pre-dismissal meeting, works council consultation, government approval.
• Dismissal letter drafted with the specific legal reason cited, in the correct language, in the required format.
• In-country counsel or EOR legal sign-off received in writing.
• Settlement budget approved up to a defined ceiling.
• Communication plan for the team, the manager, and any affected stakeholders.
• Final pay calculation including notice, severance, accrued leave, pro-rata bonus, and any contractual additions.
• Deregistration and offboarding tasks scheduled with payroll, IT, and benefits.

Run that checklist before the conversation, not after. The Lyon engineer’s case at the start of this guide was lost on item one.

Frequently asked questions

Can we terminate an international employee for poor performance the same way we would in the US?

No. Outside the US, performance termination requires a documented improvement process, a valid written reason, statutory notice, and statutory severance. The US at-will model does not export, and treating it as if it does is the single most common cause of wrongful dismissal claims.

How long does an international termination take?

It depends entirely on the country. The UK and Ireland can complete a clean termination in 2 to 4 weeks if the employee has under 2 years of service. France and Germany typically take 4 to 8 weeks including notice.

The Netherlands takes 5 to 8 weeks for the UWV or court approval, then notice. Brazil is fast operationally but the cost calculation alone can take a week.

Plan for 30 to 60 days as a working assumption and longer for the Netherlands and any country with collective consultation duties.

Does using an EOR remove the cost of statutory severance?

No. The EOR pays the statutory amounts as the legal employer and invoices the client. The total cost to the client is statutory notice plus statutory severance plus any negotiated uplift plus the EOR’s administration fee.

The EOR reduces procedural and timing risk and provides legal expertise but does not change the underlying entitlements.

What is the highest-risk country for without-cause termination?

Brazil for raw cost (FGTS 40% penalty plus notice plus accrued amounts), the Netherlands for timeline and procedural rigidity (UWV or court approval required), and France for procedural complexity (the entretien préalable sequencing alone has voided thousands of dismissals).

Spain is also notably expensive for unfair dismissal at 33 days per year of service.

Can we agree a mutual termination instead of going through the full dismissal procedure?

In most jurisdictions, yes, and it is usually the cleanest exit path.

Germany’s Aufhebungsvertrag, France’s rupture conventionnelle, the Netherlands’ vaststellingsovereenkomst, and the UK’s settlement agreement all provide negotiated routes that waive the employee’s right to challenge.

The employee receives statutory severance as the floor and usually negotiates an uplift. Independent legal advice is required in some markets (UK settlement agreements, French rupture conventionnelle).

What happens if we get the procedure wrong?

Procedural defects can void the dismissal entirely or trigger compensation awards ranging from a token sum to several months of salary. France, Germany, and the Netherlands take procedural defects seriously and labour courts default toward the employee.

Should the manager or HR deliver the termination news?

Both. The manager delivers the reason; HR delivers procedural detail. The EOR delivers formal written notice and runs the local process. Splitting these roles reduces the risk of an off-script comment becoming a discrimination claim.