Article 70

Rescission without just cause on the initiative of the employer

• 1. The employer may rescind the contract at any time, irrespective of just cause, in which case the employee is entitled to a compensation for an amount equivalent to:
• 1) Seven days of the basic remuneration if the labour relation has duration above the probationary period and up to one year;
• 2) Ten days of the basic remuneration per year of service if the labour relation has duration above one year and up to three years;
• 3) Thirteen days of the basic remuneration per year of service if the labour relation has duration above three years and up to five years;
• 4) Fifteen days of the basic remuneration per year of service if the labour relation has duration above five years and up to seven years;
• 5) Sixteen days of the basic remuneration per year of service if the labour relation has duration above seven years and up to eight years;
• 6) Seventeen days of the basic remuneration per year of service if the labour relation has duration above eight years and up to nine years;
• 7) Eighteen days of the basic remuneration per year of service if the labour relation has duration above nine years and up to ten years;
• 8) Twenty days of the basic remuneration per year of service if the labour relation has duration of more than ten years.
• 2. For the purposes of the preceding paragraph, the length of service of the employee in the calendar year in which the labour relation is terminated shall be calculated by months, in the proportion of one twelfth for each month or period of less than a month but more than fifteen days.
• 3. The maximum amount of compensation referred to in paragraph 1 is limited to twelve times the basic remuneration of the employee in the month of the termination of the contract, irrespective of the duration of the labour relation.
• 4. For the purposes of paragraph 1 and the preceding paragraph, the maximum amount of the basic monthly remuneration used to calculate the compensation is $21,500.00 (twenty-one thousand five hundred patacas) unless a higher value has been agreed upon between the employer and the employee.
• 5. The amount provided in the previous paragraph shall be reviewed every two years, and can be adjusted according to economic development.
• 6. In the event of rescission of a fixed term contract without just cause by the employer before the expiry of the contract’s term, the employer is obliged to pay the employee a compensation calculated according to the period between the date of the rescission and the expiry date of the contract mutually agreed upon, equivalent to three days of the basic remuneration for each month or period of less than a month.
• 7. In the event of rescission of contract without just cause by the employer within two years after notifying the Labour Affairs Bureau the agreement on reducing the basic remuneration pursuant to paragraph 5 of Article 59, the compensation pursuant to paragraph 1 of this article and paragraph 4 of Article 72 shall be calculated according to the basic remuneration earned by the employee before the conclusion of the aforementioned agreement.

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