ATE-Labour Relations Update
ATE/LRU/2020
Termination of Employment in Tanzania
Q: Who can terminate an employment contract?
Ans: Termination is the ending of employer/employee
relation and it can happen in various ways. Both parties
to an employment contract can terminate the employ-
ment contract; the employer and the employee can mu-
tually terminate the contract or the contract can be ter-
minated automatically by reasons of time.
Q: In what ways can an employment contract be
terminated?
Ans: Lawful termination can be done in several ways:
1. Termination by Employer
An employer may terminate an employment contract;
however, this termination has to have reasons that are
acceptable by law and has to follow procedures that is
set by law and which is fair. The reasons for termination
by the employer include:
a. Termination on disciplinary grounds
b. Termination by reason of poor performance
c. Termination by reason of ill health
d. Termination on operational requirement
e. Termination of employment for incompatibility
2. Termination by Employee
This is commonly known as resignation and notice is
issued by the employee. (Rule 6, Code of Good
Practice, GN 42 of 2007)
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Volume 05
3. Automatic Termination
A contract of employment may automatically terminate due
to circumstances such as death or retirement or the lapse of
time for a fixed term contract or sequestration of the employ-
er. (Rule 5, Code of Good Practice, GN 42 of 2007).
4. Mutual Termination
Mutual termination signifies that there is an agreement be-
tween the employer and employee to end their contractual
relationship. (Rule 4, Code of Good Practice, GN 42 of
2007)
Q: In what circumstances can a probationary
employee’s contract be terminated?
Termination of probationary employees may be done on
grounds of incompatibility, incapacity, gross misconduct,
poor performance and any other reasons provided under the
law. (Rule 10, Code of Good Practice, GN 42 of 2007)
Q: Who is not entitled to severance pay after
termination?
Ans: Severance pay is the pay of 7 days per each year worked
to a maximum of 10 years. The following employees are not
entitled to severance pay after termination:
a. Employees terminated for reasons of misconduct
b. Employees terminated on grounds of incapacity, in-
compatibility or operational requirements of the em-
ployer but who unreasonably refuse to accept alterna-
tive employment with that employer or any other em-
ployer.
c. Employees who attain retirement age
d. Employees whose fixed term contracts have expired
e. Employees who resign. (Section 42 ELRA)
Q: What is constructive termination?
Ans: Constructive termination is where an employer makes
an employment intolerable which may result on the resigna-
tion of an employee, that resignation amounts to forced resig-
nation or constructive termination. (Rule 7, Code of Good
Practice, GN 42 of 2007)