Question: Our company has a male employee who will reach the retirement age in December 2025 as prescribed by law. Currently, we wish to terminate his employment contract before the official retirement date in order to recruit a replacement. What should the company consider when proceeding with this?
Answer:
According to Clause 1, Article 34 of the 2019 Labor Code: "The employer has the right to terminate the employment contract when the employee reaches the statutory retirement age as prescribed by social insurance laws."
Therefore, when the employee meets the retirement age requirement, the company may terminate the employment contract but must take the following into account:Provide prior notice to the employee at least 30 days for a fixed-term contract or 45 days for an indefinite-term contract.
Ensure the employee's entitlements, including severance pay if they qualify under Article 46 of the 2019 Labor Code.
Note: If the company terminates the contract before the retirement age without a legitimate reason, it may be considered an unlawful unilateral termination, and the company may be liable for compensation in accordance with the law.
