Lia Nikoghosyan, Senior Attorney

There is no “at-will” employment in Armenia. An employer cannot dismiss a staff member simply because the relationship isn’t working out — every employer-initiated termination must rest on one of the specific grounds in the Labor Code of the Republic of Armenia, and must follow the notice, documentation, and payment rules attached to that ground. Get the ground wrong, skip notice, or under-pay severance, and the dismissal can be challenged in court, with reinstatement, back pay, or compensation as the result.

Armenian courts treat the Labor Code’s list of employer-initiated grounds as closed, not illustrative. An HR policy that adds its own reasons — “poor cultural fit,” say — can’t stand alone; the dismissal still has to be framed around a statutory ground, backed by contemporaneous documentation. If challenged, a court will look for the employer’s written order citing the specific ground, any disciplinary or attestation records behind it, and proof that notice and payments were properly given. Employers who treat the paperwork as an afterthought are usually the ones who lose these cases, even when the underlying business decision was reasonable.

Lawful Grounds for Employer-Initiated Termination

The grounds split into two categories, and which one applies decides both the notice period and whether severance is owed.

No-fault, business-driven grounds generally carry both notice and severance: liquidation or cessation of a sole entrepreneur’s activity; employer bankruptcy; workforce or position reduction (redundancy) from a genuine change in workload, economics, technology, or organization — reorganizing the company or changing ownership is not by itself a valid ground unless it actually cuts positions; an employee’s non-compliance with the position, via documented lack of qualification (internal attestation) or a health condition preventing continued work; long-term incapacity once sick leave passes a statutory threshold (sources diverge on the exact current day-count — confirm with counsel); reinstatement of a previously dismissed employee by court order; and the employee reaching a statutory age in the specific circumstances the Code envisages.

Fault-based grounds generally carry neither, since the departure is treated as the employee’s own doing: an unsatisfactory probation result; repeated, unexcused failure to perform duties (usually requiring a prior warning); a single serious violation — unexcused full-day absence, intoxication at work, theft or property damage, or disclosure of a protected secret; and loss of trust, for employees who directly handle money or assets.

Termination can also happen outside this framework — mutual agreement, resignation (generally one month’s notice), expiry of a fixed-term contract, or conscription — each with its own severance treatment. Classifying the actual reason for the departure correctly matters more than any single step that follows.

Notice, Pay in Lieu, and Severance

Notice periods vary by ground and, for some, by length of service — roughly 14 to 60 days, with longer-serving employees generally owed more on grounds like redundancy or non-compliance. An employer wanting to end things immediately can generally pay the average daily wage for each day of notice not given instead. Fault-based dismissals can typically proceed without notice.

Severance follows the same divide: a no-fault dismissal generally carries severance based on average monthly wage, with grounds like long-term incapacity or retirement age calculated instead by length of service. Misconduct dismissals, resignations, and expired fixed-term contracts generally carry none.

Termination ground	Notice generally required?	Severance generally due?
Liquidation / employer bankruptcy	Yes	Yes
Redundancy (workforce/position reduction)	Yes, often longer for long-tenured staff	Yes
Non-compliance with the position (qualification or health)	Yes	Yes
Long-term incapacity to work	Yes	Yes, tied to length of service
Employee reaches relevant statutory age (specific cases)	Yes	Yes, tied to length of service
Unsatisfactory probation result	Short/none	No
Repeated unexcused failure to perform duties	No	No
Single gross violation (absence, intoxication, theft, secrecy breach)	No	No
Loss of trust (asset-handling roles)	No	No
Resignation by employee	Employee gives notice	No
Expiry of fixed-term contract	N/A	No

Because this table reflects the general statutory scheme rather than every documented exception, employers should confirm the precise figures for a specific case — particularly the incapacity threshold and any recent amendments — before finalizing a termination order.

Protected Employees and Mass Layoffs

Two categories receive heightened protection: pregnant employees, from the day the employer receives a medical certificate confirming pregnancy through one month after maternity leave ends, and employees caring for a child under one. For both, the available grounds narrow to essentially liquidation, bankruptcy, and a small subset of the fault-based grounds — not redundancy, non-compliance, or incapacity. Dismissing a protected employee on an ordinary ground is one of the most common, and most avoidable, sources of successful wrongful-dismissal claims.

A separate rule applies at scale: reducing more than 10% of the workforce, and at least 10 employees, within a two-month period requires notifying the State Employment Service and the employees’ representative body two months in advance, on top of individual notice.

Process, Common Mistakes, and When to Get Help

A compliant dismissal generally follows the same sequence: confirm the real ground first, since it decides everything downstream; check the employee isn’t in a protected category; build the documentary record; calculate notice (or pay in lieu) and severance together; issue a written order citing the specific ground and obtain acknowledgment; settle all final payments, including unused leave, on the last working day; and for a foreign employee, check the effect on residence status, since a replacement contract usually has to be registered within a limited window — see Retrieve’s guide to work permits in Armenia.

Most disputes trace back to a few avoidable mistakes: a vague reason instead of the actual statutory ground; skipping the prior warning a “repeated failure” dismissal requires; dismissing a pregnant employee or new parent on an ordinary ground; under-calculating severance from base salary rather than average monthly wage; and paying final amounts late, which alone can prompt an inspection complaint.

Straightforward exits — a fixed-term contract expiring, a clean mutual agreement — rarely need more than correct paperwork. Legal review earns its cost when the employee is protected, the misconduct evidence is thin, a redundancy round nears the mass-layoff threshold, a foreign employee’s residence depends on the job, or the employee has already signaled they’ll challenge the decision.

Conclusion

Armenian labor law gives employers real flexibility to end an employment relationship — but only along the paths the Labor Code provides, with the notice, documentation, and payment that go with the path chosen. The biggest driver of wrongful-dismissal risk isn’t the decision to let someone go; it’s mismatching the paperwork to the real reason for the departure.

If you’re planning a dismissal, handling a redundancy round, or have received a claim from a former employee, Retrieve Legal & Tax’s employment team can review the facts and documentation before you act — through our Employment Law practice page or by contacting us directly.

This article provides general information on Armenian employment law as of August 2026 and does not constitute legal advice for any specific situation. Notice periods and incapacity-related thresholds are periodically amended; individual dismissals should be reviewed by qualified counsel before action is taken.

Frequently Asked Questions

Can I fire an employee in Armenia without giving a reason?

No. Every employer-initiated dismissal must be based on one of the specific grounds in the Labor Code, properly documented.

How much severance pay is an employee entitled to in Armenia?

It depends on the ground. No-fault dismissals (redundancy, liquidation, incapacity) generally carry severance based on average monthly wage or length of service; fault-based dismissals generally carry none.

What notice period is required before dismissal in Armenia?

Roughly 14 to 60 days, depending on the ground and, for some grounds, length of service. Employers can typically pay instead of notice.

Can a pregnant employee be dismissed in Armenia?

Only in narrow circumstances — company liquidation, employer bankruptcy, and a small set of serious-misconduct grounds. Ordinary grounds like redundancy don’t apply to pregnant employees or those caring for a child under one.

What happens if a company reduces more than 10% of its staff at once?

The employer must notify the State Employment Service and the employees’ representative body at least two months in advance, in addition to individual employee notice.

What can an employee do if they believe they were dismissed unlawfully?

Challenge it in court, where remedies can include reinstatement, back pay, or compensation. Employees should seek advice promptly, as labor disputes are subject to procedural time limits.

Does firing a foreign employee affect their right to stay in Armenia?

It can. A foreign employee’s residence status is often tied to an active, registered employment contract, so termination can put their residence status at risk if a new contract isn’t registered within the applicable window. See our guide on work permits in Armenia for how this interacts with dismissal.