Key takeaways: Dismissal in Morocco is governed by Articles 35 to 78 of the Labour Code (Law 65-99). The employer must follow a strict procedure: hearing within 8 days, reasoned notification by registered letter and a copy to the labour inspector. Severance pay ranges from 96 to 240 hours of salary per year of service. Unfair dismissal exposes the employer to damages of 1.5 months’ salary per year, capped at 36 months.
Legal Dismissal Procedure
Preliminary hearing
Before any dismissal on personal grounds, the employer must follow the disciplinary procedure set out in Article 62 of the Labour Code:
- Summon the employee to a preliminary hearing within 8 days of the date the misconduct is established
- Allow the employee to be accompanied by a staff representative or trade union delegate
- Draw up minutes of the hearing, signed by both parties
If the employee refuses to sign the minutes, the employer calls upon the labour inspector to record the refusal.
Notification of dismissal
Article 63 requires written notification of dismissal containing:
- The grounds justifying the dismissal
- The date of the preliminary hearing
- The notice period granted
This notification must be sent by registered letter with acknowledgement of receipt or delivered by hand against a signed receipt. A copy must be sent to the competent labour inspector.
Timeframe and formalities
The dismissal takes effect on the date of notification. The employer must provide the employee with:
- A work certificate within 8 days of the end of the contract
- A detailed final settlement statement listing all sums paid
- A CNSS end-of-contract certificate
Statutory Severance Pay
Progressive scale (Art. 52-53)
Severance pay is calculated on the basis of the average hourly salary over the 52 weeks preceding the dismissal, according to the following scale:
| Seniority | Allowance per year |
|---|---|
| 1 to 5 years | 96 hours of salary |
| 6 to 10 years | 144 hours of salary |
| 11 to 15 years | 192 hours of salary |
| Over 15 years | 240 hours of salary |
Worked example
An employee with 12 years of service and a gross monthly salary of 8,000 MAD (approximately 46.15 MAD/hour for 173.33 monthly hours):
- First 5 years: 5 x 96 x 46.15 = 22,152 MAD
- Next 5 years (6-10): 5 x 144 x 46.15 = 33,228 MAD
- Last 2 years (11-12): 2 x 192 x 46.15 = 17,722 MAD
- Total: 73,102 MAD
Severance pay is due regardless of the reason for dismissal, except in cases of gross misconduct by the employee.
Notice Period
Duration by seniority and category
The notice period is set by Decree No. 2-04-469 of 29 December 2004, according to professional category and seniority:
| Category | Less than 1 year | 1 to 5 years | Over 5 years |
|---|---|---|---|
| Workers and employees | 8 days | 1 month | 2 months |
| Managers and equivalent | 1 month | 2 months | 3 months |
During the notice period, the employee is entitled to 2 hours of absence per day (or 8 consecutive hours per week) to seek employment, without salary reduction.
Compensatory notice allowance
If the employer waives the notice period, they must pay a compensatory allowance equivalent to the salary the employee would have received during the notice period.
Economic Dismissal
Specific procedure (Art. 66-71)
Dismissal on economic grounds (restructuring, financial difficulties, cessation of activity) follows a reinforced procedure:
- Consultation of the works council or staff representatives at least one month before the dismissal
- Submission of the file to the provincial governor for authorisation
- The governor has a 2-month period to respond; silence constitutes refusal
- In case of refusal, the employer may appeal to the competent court
The file must include the economic reasons, the number of employees concerned, the criteria for the order of dismissals, and the projected timeline.
Order of dismissals criteria
In the absence of a collective agreement, the order of dismissals considers:
- Seniority within the company
- Professional value
- Family responsibilities
Unfair Dismissal Penalties
Definition and damages
Article 41 of the Labour Code defines unfair dismissal as any dismissal without valid grounds or failing to comply with the legal procedure.
An employee who is a victim of unfair dismissal may claim:
- Damages = 1.5 months’ salary per year of service, capped at 36 months
- These damages are in addition to the statutory severance pay and notice period compensation
Reinstatement
Article 41 also provides for the possibility of reinstatement of the employee to their position, by mutual agreement between the parties, instead of damages.
For a detailed analysis of employee rights in case of dismissal without valid cause, see our article on unfair dismissal in Morocco. See also our guides on disciplinary dismissal in Morocco and gross misconduct.
FAQ
Can the employer dismiss an employee on sick leave?
No, dismissal during sick leave of less than 180 days is considered unfair, unless the employer can demonstrate a reason unrelated to the illness. Beyond 180 days, the employer may initiate the permanent replacement procedure.
Can the employee challenge their dismissal?
Yes. The employee has a 90-day period from the date of notification of dismissal to bring a case before the court of first instance (social chamber) (Art. 65).
Is severance pay taxable?
Statutory severance pay is exempt from income tax within the limits of the legal scale. Amounts exceeding the scale are subject to income tax.
What happens if the employer does not respect the notice period?
An employer who fails to respect the notice period must pay a compensatory allowance equal to the salary corresponding to the notice period. An employee who leaves without notice owes the same allowance to the employer.
READ ALSO
- Unfair Dismissal in Morocco
- Notice Period and Contract Termination in Morocco
- Severance Pay in Morocco
- Taxation of Severance Pay in Morocco
- Disciplinary Dismissal in Morocco
- Tax Advisory Services
Facing a dismissal situation or looking to secure your HR procedures? The chartered accountants at Upsilon Consulting help you calculate severance, draft the required documents and comply with the legal procedure.
This article is written by the team of chartered accountants at Upsilon Consulting, a firm registered with the Order of Chartered Accountants (OEC) of Morocco.
