Mongolian law recognizes “Specified Term” and “Permanent” employment. A Specified Term agreement states a definite starting date, and ending for the employment, or a condition that ends the employment when and if it occurs.
Mongolian law stipulates that a Specified Term agreement will be automatically extended for the duration of the initially stated term if termination of the agreement is not proposed by the parties, and the employee continues to work in the position.
For a valid Specified Term agreement, the employment automatically ends at the end of the specified term, or upon the occurrence of an event, such as return to work of an original employee. In this case, a termination notice from the employer should be utilized so as to avoid the situation described above in which the Specified Term agreement automatically renews under Mongolian law.
To qualify as a “Permanent” position under Mongolian law, the employment agreement must be concluded for an indefinite term. This means no stated ending date, and no stated event or condition upon the occurrence of which the employment ends.
If a Specified Term agreement is terminated before the term expires, or a Permanent position is terminated, the termination provisions of the Agreement and of Mongolian Law will apply.
Per Mongolian law, for a Specified Term agreement, the requirements and reasons requiring Specified Term employment, and any conditions in connection with the same must be clearly stated in the Employment Agreement. Such requirements, reasons or conditions will typically be the need for temporary or seasonal employment for the replacement of an employee that is taking some kind of hiatus from work, but whom the employer expects to return.