Publication

An employee has a duty to perform the tasks specified within the employment contract in accordance with their professional abilities and qualifications. However, in practice, there are situations where an employee does not have the sufficient skill set to perform the agreed work, and although the employee may assume the employer should be able to assess their skills during the probationary period, it must be acknowledged that in practice this is not always possible.

Frequently during the probationary period, the employee only becomes familiar with the scope and content of the agreed work duties.  During this period, employers also often assign easier or simpler tasks to the employee allowing them to gradually become familiar with their work duties. An employee’s lack of professional qualifications may also be discovered some time after the commencement of the employment relationship. For example, if the employee is unable to maintain or renew their professional qualifications, which is a mandatory requirement in certain professions.

For such instances, the legislator has provided an employer with the right to terminate the employment contract if the employee does not have sufficient professional skills to perform the agreed work duties, in accordance with Article 101(1)(6) of the Labor Law. The latter however differs from termination (e.g., due to a breach of the employment contract or work regulations), on the understanding that the lack of professional skills is not a specific culpable action on the part of the employee.  Rather an objective failure to meet the requirements of the position and an inability to perform work duties to a high standard, which can often be observed over a longer period of time.

What are ‘professional abilities’ and how can an employer determine their lack of in an employee?

Article 101(1)(6) of the Labor Law is applicable if during the performance of work the employer concludes that the employee does not have the appropriate skill set and for this reason cannot perform the work agreed to in the employment contract in a qualitative and proper manner.

As recognised in legal doctrine, ‘professional abilities’ within the meaning of this provision include not only theoretical knowledge, but also practical skills and experience. For example, during the employment relationship the rules governing the qualifications required to perform the work in question may change. If an employee does not acquire these qualifications within a certain period of time, there are grounds for dismissing the employee.[1] The qualification requirements for a position are related to the work duties of the position and without the appropriate qualifications and skills, it is not possible to perform the duties of the position in question.[2] Similarly, a failure to comply with the educational requirements set out in the regulatory enactments may be an independent ground for the application of Article 101(1)(6) of the Labor Law.

The same cannot be said in the situation whereby the employer imposes certain educational or additional skill requirements (i.e., if no relevant qualification criteria are specified in an external regulatory act for the specific profession/position). In such instances, when terminating the employment contract, the employer must be able to evidence that the employee’s lack of the education and/or additional skills specified by the employer are grounds for terminating the employment contract. In other words, the employer must be able to evidence the employee’s existing education and/or skills are indeed insufficient to perform the agreed work duties.[3]

For example, if an employer wishes to terminate the employment relationship with an employee on the basis of Article 101(1)(6) of the Labor Law, because an internal audit has established shortcomings and/or violations for which the employee was responsible for monitoring, the employer should first assess whether the identified shortcomings/violations are directly related to the employee’s insufficient professional abilities.

When terminating an employment contract due to complaints about the quality of an employee’s work, the employer should first inform the employee of the complaints or at least give them the opportunity to provide an explanation. Otherwise, the court may declare the termination unlawful, concluding that the employer has terminated the employment relationship with the employee without prior warning and without giving them the opportunity to provide an explanation.[4] However, as recognized in court practice, the fact that the employee’s view of how he or she performs his or her job duties differs from the employer’s view does not mean that the employer’s assessment is incorrect.[5]

An employee’s professional abilities assessment carried out based on the employee evaluation procedure developed within the company may also serve as grounds for termination. Namely, the existence of an evaluation system and a written evaluation helps the employer prove they have objective reasons based on specific evaluation criteria for ending the employment relationship.[6]

It is also important to emphasise, the employer is not obliged to set out in detail all of the factual circumstances underlying the notice of termination in the notice itself. According to established case-law, the factual circumstances underlying the notice of termination may also be indicated in other documents (not only in the notice of termination of the employment contract)[7] if these documents clearly show the violation committed by the employee and how it manifested itself.[8] However, the grounds for termination must be sufficiently detailed to enable the court to review them in the event of a potential dispute. If this requirement is not met, the termination may be deemed unjustified.[9]

The employer’s actions prior to termination of the employment contract

The Labor Law does not require the employer to request explanations from the employee and evaluate the employee’s personal qualities, as well as previous work before terminating the employment contract (unlike termination under Article 101, Paragraph 1, Points 1, 2, 3, 4, and 5 of the Labor Law).

However, Article 125 of the Labor Law imposes an obligation on the employer to prove the termination of the employment contract is legally justified and complies with the established procedure for terminating an employment contract. Therefore, as already emphasised above, the employer must provide comprehensive and sufficient evidence to confirm the employee’s professional abilities have been objectively assessed, as well as the employer has reasonably concluded these abilities are insufficient to perform the agreed work duties.

In accordance with Article 101(4) of the Labor Law, termination of an employment contract due to an employee’s lack of professional skills is permitted if the employer is unable to employ the employee in another position in the same or another company with the employee’s consent. Nevertheless, even in this instance, according to the findings expressed in the applicable case-law, the employer’s obligation to offer work applies if the employer has an opportunity at the time of giving notice, considering only work that the employee can perform in accordance with their qualifications and abilities should be offered.[10]

The employer must also consider the employment relationship with a trade union member can only be terminated with the consent of the trade union. If the trade union does not agree to the termination, the employer must file a claim in court for termination of the employment contract.[11]

If the collective agreement or employment contract does not specify a longer notice period, the employer’s notice period is one month.[12]

Conclusion

A valid reason for termination by the employer in accordance with Article 101(1)(6) of the Labor Law is a situation whereby the employee is objectively unable to maintain or renew the professional qualifications specified in regulatory enactments, which are essential for the performance of the specific job duties.

This means the employee’s professional abilities do not meet the mandatory qualification requirements specified in the regulatory enactments, and this non-compliance prevents them from performing their work duties properly. However, if the employer has defined additional criteria and/or standards in addition to the requirements set out in the regulatory enactments, the employer has a duty to be able to clearly justify the need for such additional requirements, linking them to the specific needs of the job description and the nature of the position.

As provided under Article 125 of the Labor Law, the employer must be able to prove the legality of the termination. In the event of a potential risk of litigation, it is advisable for the employer to ensure there is sufficient evidence to confirm that: (i) the employer has assessed the employee’s professional abilities; (ii) the assessment was objective (i.e., using clear and proportionate criteria); and (iii) the conclusions drawn are justified.

Considering the specifics of the application of Article 101(1)(6) of the Labor Law, in order to avoid potential disputes and to ensure the professional abilities of the employee meets the requirements of the position, it would be advisable for the employer to verify the employee’s professional abilities as thoroughly as possible during the probationary period. During this period, the employer should provide the employee with a real opportunity to fully demonstrate their knowledge, skills and abilities by assigning them work tasks/duties that (in terms of content, level of complexity and scope) truly correspond to the requirements specified in the employment contract and/or job description. Thus, allowing for an objective assessment of the employee’s performance and eliminating the risk that the employee’s professional qualities are not properly assessed.

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[1]       See the Latvian Free Trade Union Confederation, ZAB “BDO Law”, Labor Law with Comments, Riga, 2020, p. 277.

[2]       See, for example, Judgment of the Supreme Court of the Republic of Latvia of 16 October 2014 in civil case No. C26081013, SKC-2177/2014.

[3]        See, for example, the Judgment of the Preiļi District Court of 19 May 2015 in civil case No. C25054813.

[4]        See, for example, the Judgment of the Riga District Court of 26 September 2019 in civil case No. C33366919.

[5]       See, for example, Judgment of the Civil Cases Department of the Riga Regional Court of 29 November 2021 in civil case No. C29440620.

[6]       See, for example, the judgment of the Civil Cases Department of the Riga Regional Court of 15 September 2022 in civil case No. C30778519.

[7]        See, for example, Judgment of the Supreme Court of the Republic of Latvia of 29 September 2010 in case SKC-758/2010 (C28199509).

[8]        See, for example, Judgment of the Supreme Court of the Republic of Latvia of 9 March 2011 in case No. SKC-613/2011 (C30512009).

[9]        See Judgment of the Supreme Court of the Republic of Latvia of 20 October 2004 in case No. SKC–557.

[10]      See Judgment of the Supreme Court of the Republic of Latvia of 14 February 2017 in case No. C29634715, SKC-551/2017.

[11]      See Article 110, paragraphs 1 and 4, of the Labor Law.

[12]      See Article 103(1)(3) of the Labor Law.