Ethiopian Employment Law

Forced Resignation Under Ethiopian Employment Law

There are two mechanisms an employee may terminate his employment contract upon his own initiation. The first one is by giving 30 days advance notice. Apart from the notice, no valid ground is necessary for such termination. The second is termination without notice due to valid grounds specified by the labour proclamation. Both mechanisms produce different results in terms of payment of compensation. The purpose of this short article is not to compare these two kinds of termination. The scope of the article is limited to overview of the procedural and substantive requirements for lawful termination of employment contract by the employee including the legal effect thereof.

Forced Resignation and Constructive Dismissal

Dismissal and resignation are two terms employed to indicate termination by the employer and the employee respectively. Neither of these two terms are used in the labour proclamation. As pointed out above, resignation could be with or without notice. In common law countries, resignation without notice is called constructive dismissal. Such kind of dismissal is considered for all legal and practical purposes as dismissal by the employer. By its very definition, constructive dismissal is where an employer has committed a serious breach of contract, entitling the employee to resign in response to the employer’s conduct.[1]

The designation is based on the fact that the employee is forced to resign from his job because of intolerable pressure by the employer leaving the worker with no choice but to leave. The pressure may be manifested through serious breach of the contract or violation of the rights and dignity of the employee. In other words, it is a kind of indirect dismissal of the employer.

Ethiopian employment law does not recognize the concept of constructive dismissal. Irrespective of the degree of breach of contract by the employer, termination by the employer due to such breach is categorized under termination upon initiation of the employee. Additionally, not all breaches and violations are considered as valid, even though they may be serious and gross acts endangering the very existence of the contract.

Valid Grounds

The labour proclamation identifies following as good causes to terminate a contract of employment without prior notice:

a) Where the employer has committed any act contrary to human dignity and morals or other acts punishable under the Criminal Law against the worker;

b) Where the worker has been a victim of sexual harassment or sexual violence by the employer or a managerial employee;

c) In the case of imminent danger threatening the worker’s safety or health, where the employer, having been made aware of such danger, failed to act within the time limit in accordance with the early warning given by the competent authority or appropriate trade union or the worker himself to avert the danger;

d) Where the employer has repeatedly failed to fulfill his basic obligations towards the worker as prescribed under this Proclamation, collective agreement, work rules or other relevant laws.

Even though ‘repetition’ is used to measure the magnitude of the damage caused by the employer, there are many acts of breach that occur only once which may cause serious harm to the worker. For example, commission of one of the prohibited acts listed in Article 14 (1) will definitely cause serious harm on the worker making the work environment intolerable.


A worker’s right to terminate his contract of employment in accordance with Article 32 (1) of the labour proclamation shall expire after fifteen working days from the date on which the act occurred or ceased to exist. [Article 33 LP] The rationale behind forced resignation is providing the employee with choice when the employment relationship is harmed due unjustifiable acts of the employer. Failure to utilize such option within a reasonable period of time, to some extent signifies the worker has is ok with the continuation of the relationship. [Without denying that it may also be due the worker being in a position of ‘no choice’ if he can’t find alternative employment.]

Article 33 is wrongly as period of limitation. However, the article is talking about extinctive prescription, not period of limitation. The former indicates a claim has been extinguished by the lapse of time, whereas the latter is about time limit for raising or presenting a question. In terms of legal effect both are different. In extinctive prescription the lapse of time results in loss of right. Therefore, it may be applied by court even if not raised by defendant. Period of limitation also potentially results in loss of right, but only if raised by defendant.

Compensation and Severance Pay

A worker who terminates his contract of employment in accordance with Article 32(1) of the labour proclamation shall be entitled, in addition to severance pay, to a payment of compensation which shall be thirty times his daily wages of the last week of service. The compensation increases if termination is due to sexual harassment or violence. Accordingly, where the termination is based on sexual harassment or sexual violence the worker shall, in addition to severance pay, be entitled to compensation of his daily wage multiplied by ninety.


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