Nepal

An employment contract must end in accordance with the rules laid out by Labor Act 2074. Employment can come to an end naturally if it is time-based, work-based, voluntary, or casual. Employees can also be terminated for poor performance, and compulsory retirement and may choose to resign due to persistent health problems.  

Several termination scenarios are outlined in Nepali labor laws:

• Letter of resignation: An employee may submit a letter of resignation, which must be approved by the employer within 15 days. If the employer does not accept the resignation, the termination becomes effective after the 15-day period. If the employee continues to work after this period, the resignation is null and void.
• Termination at the end of the job: Termination for work-based or time-bound employees occurs automatically at the end of the job or time frame. If the employer extends the project, a work-based employee's employment continues.
• Medical issues: If an employee suffers from a medical condition that necessitates long-term treatment, an employer may request a termination based on a doctor's recommendation. However, if the employee was injured on the job and is undergoing treatment, the employer can only fire the employee after a year of treatment.
• Poor job performance: Terminating employees for poor performance is a more involved process because it allows them to explain their actions. Employers who believe a worker's performance falls short of expectations can conduct a performance appraisal. The employee has seven days to submit an explanation for low productivity, such as personal issues. If an employee fails to meet appraisal standards three times in a row, the employer has the right to fire them.

Certain behaviors result in automatic dismissal from service, such as:

• Inflicting bodily harm or injury on any member of the entity
• The acceptance or offering of bribes
• Stealing or causing property damage
• Embezzlement
• 30 days of unapproved leave
• Receiving two misconduct punishments within two years
• Using forged documents
• Using psychotropic drugs or drinking alcoholic beverages

Employee resignation letters should be signed and approved by employers within 15 days of submission. 

Employers in Nepal may structure employment agreements so that employees remain in a probation period for up to six months. During this period an employee may be terminated if his or her work is not satisfactory.

If an employee is not eligible for an unemployment benefit under the Social Security Act, they are entitled to one month's pay for each year of service as severance pay.