Firing an employee in Ukraine: why "at-will" doesn't exist

01

The mindset shift: dismissal is a legal procedure, not a decision

In the US, termination is essentially a management decision. In Ukraine, it's closer to a legal procedure with a management decision behind it. The employee is the protected party by design — Ukrainian labor law inherited a strongly pro-employee logic, and courts apply it that way.

Practically, this means three questions must have clean answers before anyone is dismissed:

1. 01Which exact ground from the Labor Code applies? There's a closed list. If your situation doesn't match any item on it, there is no lawful dismissal — full stop.
2. 02Was the procedure for that ground followed? Each ground has its own choreography: notice periods, written warnings, offers of alternative positions, union consultations.
3. 03Is it all on paper? Verbal warnings and Slack messages count for very little. Courts want orders, acts, signed acknowledgments, and dates that line up.

Now let's look at the actual routes, starting with the one that solves most cases.

02

Route one: mutual agreement — the workhorse of Ukrainian terminations

The single most useful thing to know about firing in Ukraine is this: most terminations here happen by mutual agreement of the parties (угода сторін). The employer and employee simply agree, in writing, that employment ends on a specific date. That's it.

Why is this route so popular?

• —Any date works. No mandatory notice period — you can agree to part ways today.
• —No statutory severance required. Whatever the parties negotiate is the deal. In practice, employers usually offer one to three months of salary as an incentive, but that's a commercial decision, not a legal obligation.
• —Very hard to challenge. Once signed, a mutual agreement is nearly bulletproof in court, unless the employee proves they were coerced.
• —Clean exit for both sides. No disciplinary record, neutral wording, no drama.

So when a foreign manager says "it's just not working out," the honest answer is usually: it's not a dismissal ground, but it's a negotiation starting point. You offer a fair package, the employee signs, everyone moves on. Ninety percent of "performance" and "culture fit" separations in Ukraine end exactly this way — and it's usually cheaper than the alternative, once you factor in the risk of litigation.

03

Route two: the employee resigns

An employee can quit at any time with two weeks' written notice (ст. 38 of the Labor Code). They don't need a reason, and you can't refuse. If there's a valid reason — relocation, health, caring for a child, employer violating the law — they can leave without serving the notice at all. During martial law, employees working in areas of active hostilities can also resign without notice.

One thing that occasionally shocks foreign employers: an employee can withdraw their resignation before the two weeks run out, and unless you've already formally invited a replacement, they simply stay.

04

Route three: dismissal at the employer's initiative

This is the hard road — dismissal against the employee's will. The Labor Code lists the grounds exhaustively. The ones that matter in practice:

Redundancy (staff reduction)

Legitimate when the position genuinely disappears — restructuring, downsizing, closing a business line. But the procedure is heavy:

• —Two months' written notice to the affected employee, against signature.
• —Obligation to offer alternative vacancies — every suitable open position in the company, not just once but throughout the notice period.
• —Priority rules on who stays when similar positions are cut (higher qualification wins; family circumstances matter as tiebreakers).
• —Union consultation, if a union operates at the company.
• —Severance of at least one average monthly salary on the way out.

Courts scrutinize redundancies hard. If a "cut" position reappears under a new name three months later, or if a suitable vacancy wasn't offered, the dismissal collapses. Redundancy done properly takes at least two months and a paper trail; redundancy done as a cover story for "we just wanted them gone" is the classic lost lawsuit.

Poor performance — much harder than you think

There are two distinct grounds here, and both are demanding.

Unsuitability for the position — the employee objectively lacks the qualification or health to do the job. You need evidence: certification results, documented failures, medical conclusions. "The manager is unhappy" is not evidence.

Systematic failure to perform duties — the employee keeps neglecting their documented duties without valid reasons. The key word is systematic: you need at least one formal disciplinary sanction (догана) already on record within the past year, properly issued — with a written explanation requested from the employee, an order, and their acknowledgment. Only a subsequent violation opens the door to dismissal.

Notice what both grounds require: job duties that were actually written down somewhere. If the employment contract and job description are vague one-pagers (very common), proving someone failed to perform duties nobody defined is close to impossible. This is why performance-based dismissals in Ukraine are rare — and why mutual agreement exists.

Misconduct — the clear-cut cases

Some grounds are more straightforward, because the violation is a single event:

• —Absenteeism (прогул) — absence from work for more than three hours in a day without a valid reason. Sounds easy, but you still need acts recording the absence, a written explanation request, and caution: courts interpret "valid reason" generously, and remote work blurs what "absence" even means. Document the ground rules for remote teams in advance.
• —Showing up intoxicated — grounds for immediate dismissal, but you need contemporaneous evidence (an act signed by witnesses, ideally a medical examination).
• —Theft at the workplace — requires a court verdict or an official ruling, not just your internal conclusion.
• —For specific roles there are extras: a single gross violation by a company director, loss of trust for employees handling money or assets, an immoral act for those in educational roles.

Other grounds worth knowing

• —Expiry of a fixed-term contract — employment ends on the agreed date, no reason needed. (This is one reason fixed-term contracts are attractive — but they're only lawful in limited situations, and misusing them creates its own risks.)
• —Long-term illness — over four consecutive months of sick leave can be a ground, though it's rarely used and never applies to pregnancy or work injuries.
• —Destruction of the workplace due to hostilities — a martial-law-era ground: if company facilities are destroyed and work is objectively impossible, dismissal is allowed with 10 days' notice and severance.

05

Who you cannot fire (almost) no matter what

Ukrainian law shields several categories from employer-initiated dismissal:

If your termination plan involves anyone from this list, stop and take advice first. These cases end up in court more often than any others, and the employee almost always wins.

06

Probation: your one relatively easy exit

Probation periods in Ukraine can last up to three months (one month for blue-collar roles) and must be explicitly written into the employment contract — no clause, no probation. During probation, the employer can dismiss the employee as having failed the trial with just three days' written notice and no severance.

This is by far the lightest termination mechanism in Ukrainian law, which leads to simple advice: take probation seriously. Assess people properly in the first three months, because the cost of exit grows dramatically on day 91. Note that some employees can't be put on probation at all — including pregnant women, people under 18, and internally displaced persons.

There is no "it's just not working out" in Ukraine. Most separations happen by mutual agreement with a negotiated package — because a unilateral dismissal needs an exact Labor Code ground, a correctly followed procedure, and a paper trail, and one wrong step can put the employee back on payroll with full back pay.

07

What happens when you get it wrong

An employee who considers their dismissal unlawful can sue — and they have strong incentives to. The filing deadline is short (one month from receiving the dismissal order), court fees for labor claims are waived, and the remedies are painful for the employer:

• —Reinstatement to the same position, and
• —Average salary for the entire period of forced absence — from dismissal day until the court decision. Labor litigation can run a year or more, so this alone can reach 12+ monthly salaries, on top of your legal costs and the awkward return of a person you fired.

There's a second, less obvious trap: final settlement. On the last working day you must pay out everything owed — remaining salary and compensation for all unused vacation days (which, as we covered in our leave article, never expire). Delay the settlement, and the law charges you the employee's average salary for every day of delay. We've seen a forgotten 2,000-hryvnia vacation compensation turn into a six-figure penalty because nobody paid it for a year.

08

The practical playbook

If you take away five things from this article, make them these:

[ THREE LOWER-RISK ROUTES ]

Mutual agreementResignationProbation

Notice periodAny date — noneTwo weeksThree days

Statutory costNegotiated (often 1–3 months’ salary)NoneNo severance

Legal riskVery low — near-bulletproofLow — can be withdrawnLow — first 3 months only

Most separations use mutual agreement; probation is the only low-cost unilateral exit, and it closes on day 91.

Start with mutual agreement. In most real-world situations, a fair separation package signed by both sides is faster, cheaper, and safer than any unilateral ground. Budget for it as the default path.

Build your paper trail from day one. Detailed job descriptions, a probation clause in every contract, documented duties for remote work. You can't retroactively create the documents a dismissal will need.

Use probation for its purpose. The first three months are your only low-cost exit. Decide deliberately before they end.

Check the protected lists before doing anything. Pregnancy, small children, mobilization, sick leave — one overlooked status can turn a routine termination into a guaranteed loss.

Never touch the final settlement deadline. Whatever else happens, pay everything owed on the last day. The delay penalty is the most avoidable large expense in Ukrainian HR.

09

How we can help

Ukrany manages employment and HR compliance in Ukraine for foreign companies, and terminations are where our clients need us most — because it's the one HR process where a mistake has a price tag attached. We structure separations from the start: assessing which route fits, negotiating mutual agreements, running redundancy procedures with clean paperwork, handling protected-category cases, and making sure the final settlement leaves nothing for a court to find.

If you're facing a difficult separation in your Ukrainian team — or want your contracts and processes set up so that future ones aren't difficult — talk to us before you act. In this area, an hour of prevention is genuinely worth a year of litigation.

Need this handled?

We set up and run Ukrainian operations end to end — entity, payroll, compliance, hiring. One contract, one team on the ground.

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