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The OECD is calling for changes to private-sector dismissal rules in Greece, arguing that current notice periods and severance protections should be scaled back enough to improve labor mobility.

Under its recommendations, Greece would need to shorten legally mandated notice periods for layoffs, reducing the cost of separations for employers and, in theory, making it easier for workers to move between jobs.

In its newly released Employment Outlook 2026, the OECD argues that dismissal law should protect workers without being so strict that it limits movement within the labor market.

The organization’s updated 2025 indicators assess employee protection across four areas:

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  • the procedures required before a dismissal
  • the length of notice and severance pay
  • the legal framework for handling unfair dismissals
  • how consistently courts enforce these rules.

Overall, the comparison shows that most European countries maintain considerably stricter worker protections than Anglo-Saxon common law countries, where restrictions on layoffs are far lighter.

Tenure matters

The longer someone has worked somewhere, the greater their notice period and severance entitlement. Across OECD countries, a worker with four years of tenure gets, on average, about 1.3 months’ notice and severance equal to roughly 1.1 months’ pay. For a worker with 20 years of service, both figures more than double for notice and more than triple for severance.

In Greece, notice periods for dismissal range from one to four months depending on tenure, and the rules are even stricter for collective layoffs.

Greece is among 31 of the OECD’s 36 member countries that require additional steps for collective dismissals, such as prior consultation with worker representatives or approval from public authorities. These requirements significantly extend the time it takes to complete a collective layoff, pushing the average delay from about nine days up to roughly thirty.

For Greek employees on open-ended contracts, notice periods and severance depend on years of service with the same employer. If the employer gives written notice in advance, only half the severance is paid; without notice, the full amount is due.

Specifically, workers with:

  • up to 2 years of tenure get 1 month’s notice and 1 month’s severance with notice (2 months without).
  • 2 to 5 years get 2 months’ notice and 1.5 months’ severance with notice (3 months without).
  • 5 to 10 years get 3 months’ notice and 1.5 to 2.5 months’ severance with notice (3 to 5 months without)
  • 10-plus years get 4 months’ notice and 3 to 6 months’ severance with notice (6 to 12 months without).