THE REVISED LABOR LAW /PART 1/
Mongolia passed the Labor Law for the first time on May 14, 1999, and it has been revised 24 times since then. The Parliament passed a Revised Labor Law on July 2, 2021, which comes into force on January 1, 2022. Therefore, we have prepared in this part the key provisions that have been amended to the newly enacted Revised Labor Law.
Changed key provisions
1. Regulations Regarding the Disciplinary Sanctions
Employers can impose the following types of disciplinary sanctions:
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Individual warning to the employee; |
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open warning to an employee in the form of announcements to all employees; |
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a reduction of the base salary by up to 20 percent for a period of up to three months; |
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demotion; |
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dismissal. |
2. Regulations Concerning the Employment Agreement
The Revised Labor Law stipulates that the following key terms must be provided in the employment agreement. These include:
a) name or title of the position of employment;
b) duties and work to be performed;
c) amount of compensation;
d) working conditions and the location of the work.
3. Termination Benefits (Severance pay)
Under the Labor Law, if the employer terminates the employment agreement with the employee on the following grounds, the employer is obliged to provide the employee with an allowance equal to at least employee's one month's “average salary”, which can be increased by the employer's discretion. These include:
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if the employee has called to active duty in the army; |
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if the employer’s business entity or organization, or a branch or unit thereof, has been dissolved, or the job or position within it has been abolished, or the number of employees has been reduced |
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if it has been determined that the employee cannot meet the requirements of the job or position because of lack of professional qualifications or skill, or because of health reasons; |
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if an employee reached 60 years of age and is eligible to receive a pension. |
However, pursuant to the Revised Labor Law in case of termination of the employment agreement with the employee by the employer on the following grounds, the employee is entitled to severance pay in the amount of his/her “base salary” depending on the length of service in the business entity or organization. These include:
a) termination of the employment agreement of an employee with an employment agreement with special conditions due to the permanent transfer of ownership by the employer to other persons;
b) if the employer’s business entity or organization, or a branch or unit thereof, has been dissolved, or the job or position within it has been abolished, or the number of employees has been reduced;
c) if it has been determined that the employee cannot meet the requirements of the job or position because of lack of professional qualifications or skills
d) in case of termination of the employment agreement with the employee on the grounds that the employee is medically incapable of performing his/her duties and there are no other jobs to be transferred to him/her.