Fire someone in Germany because “it’s not working out,” and you’ll likely lose the labor court case. Outside the US, most countries require a legally valid reason to terminate an employee — and vague dissatisfaction doesn’t qualify. Unfair dismissal claims cost employers anywhere from 3 months’ salary to 24 months’ salary in compensation, plus legal fees and management time.
The standards differ by country, but they’re universally stricter than US at-will employment. Germany requires “social justification”: the reason must relate to the employee’s conduct, capability, or urgent operational needs. France requires “real and serious cause” (cause réelle et sérieuse) and a procedural sequence that includes a formal pre-termination meeting. The Netherlands requires either employee consent, a UWV permit for economic dismissals, or court approval. Brazil allows termination without cause but imposes a 40% FGTS penalty (40% of accumulated severance fund deposits) that makes it expensive. The UK protects employees from unfair dismissal after a two-year qualifying period, with tribunal awards reaching £105,707 plus a basic award.
The procedural requirements trip up foreign employers as much as the substantive ones. In France, you must send a registered letter inviting the employee to a preliminary meeting, wait at least 5 working days, hold the meeting (the employee can bring a representative), then wait at least 2 more working days before sending the dismissal letter by registered post. Skip any step and the dismissal is procedurally unfair — even if the underlying reason was valid.
Why It Matters for EOR
When you use an EOR, the EOR is the legal employer on paper. An unfair dismissal claim gets filed against them. But they’ll push the financial exposure back to you through your service agreement, so don’t assume the EOR absorbs the risk.
Good EOR providers guide you through every step: what documentation to collect, what notice period applies, whether a performance improvement plan is required first, and what severance to offer. Deel provides termination workflow tools with country-specific checklists. Other providers assign a local HR advisor for the process.
If your EOR says “just tell us when you want them gone” — find a different provider. Dismissal in most countries is a process, not an event. A provider that doesn’t push back on poorly justified terminations is one that will leave you holding the bill when the tribunal rules against them.
Before terminating anyone through an EOR, choosing the right provider with strong local employment law expertise makes the difference between a clean exit and a six-figure settlement.
For global standards on termination protections, see the ILO Convention C158 on Termination of Employment.
For practical use of this concept, see EOR vs PEO explained and remote jobs by country.
Further Reading
- Hiring in the United Kingdom: unfair dismissal protections after two years — UK employees gain unfair dismissal rights after two years, with tribunal awards reaching £105,707 plus basic awards.
- Hiring in France: the termination process and “real and serious cause” standard — France requires a formal pre-termination meeting and documented justification before any dismissal.
- Hiring in Australia: Fair Work Act protections and dismissal procedures — Australia’s unfair dismissal framework applies from day one for companies above the small business threshold.
- EOR comparisons
- Read Deel review
- EOR vs PEO explained
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