Could you please explain ‘open and closed labour contract’

Name withheld

Answer: What you are actually referring to is open-ended contracts and fixed-time contracts.
In the open-ended contracts, which are mostly the case, there is no minimum period you have to serve in a company. But you and the company can part ways by giving a notice as mentioned in your contract or according to the Labour Law. Secondly on expiry these contracts are renewed immediately on the same conditions as the previous contract.

In the fixed-time contracts you have to complete the period mentioned in the contract and anyone breaking this contract before its expiry has to compensate the other party for the period yet to be completed. In case of a company, it can claim compensation for ‘the loss it may suffer’ because of the employee leaving earlier than the period mentioned in the contract. The employee can claim an amount equal to the salary for the uncompleted period.
Before the expiry of the contract, both parties have to inform the other whether they wish to or don’t wish to renew the contract.

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