All employees, employers and workplaces in the FTIZs are subject to the relevant FTIZ laws and regulations. The Organization of each zone is empowered to implement pertinent laws and regulations.

According to Labor law and regulations governing Labor & employer relations in the FTIZs, employment contract is a written contract, which may be concluded for a fixed/unfixed time. In case the work period is not fixed, the date of completion of the work/project or the activities of the workplace will be considered the expiry of the contract. However, if the work by its nature is permanent and the work period is not specified in the contract, it will be considered permanent.

 With respect to contracts for a temporary period or specific job, neither party is allowed to unilaterally terminate the contract, except in cases provided for in the employment contract. In the event of unilateral termination of the contract by one of the parties, the other party may claim damages through the Board for Settlement of Disputes.

 The employer may fix a period of time, called a probation period, during which either party may without prior notice or payment of an indemnity, terminate the work relationship. The probation period, which is agreed upon by mutual consent of the parties and specified in the contract, may not exceed one month for unskilled and semi-skilled workers and three months for skilled workers. In any event, wages and work benefits accruing to a worker whose work discontinues in the course or at the end of probation period must be paid for the duration of the said period. Furthermore, probation contracts for a specific job may be entered into only once between an employee and employer.

An employment contract may be terminated in the following cases:

1-      Death of the employee;

2-      Retirement of the employee;

3-      Total disability of the employee;

4-      Expiry of the tenure of an employment contract concluded for a specified period;

5-      Completion of work contracted for specific work;

6-      Cancellation of the employment contract by the employer and the employee in cases stipulated in the employment contract in accordance with this decree;

7-     Dismissal of the employee.

NOTE: Whenever the dismissal of the employee is judged justified by the Board of Settlement of Disputes, the Board will confirm his/her dismissal and obligate the employer to pay 15 days of salary to the employee for each year of his/her service. However, in case of unjustified dismissal, the employer will have the option of either reinstating the employee and paying his/her salary for the period of suspension or pay his/her, by way of compensation, 45 days of salary for each year of his/her service.

Any change in employment conditions is contingent upon having been provided for in the employment contract and if the circumstances and conditions in the workplace necessitates such a change. Whenever an employer, without due consideration to the employment contract and without the consent of the employee, initiates a change in employment conditions in such a way that the employee suffers in terms of wages or prestige, the employee is entitled to lodge a complaint with the Board for Settlement of Disputes and seek relief.

Dispute resolution system

Any dispute between an employee and employer arising from the employment contract subject to the Labor Law of the FTIZs, shall be settled initially in an amicable manner. Whenever disputes are not settled amicably, either party may refer the matter to the Board of Settlement of Disputes within 10 days. The said board is composed of:

1-     The employer in question, or his/her fully authorized representative;

2-      The employee in question, or his/her fully authorized representative;

3-      The representative of the Zone Authority.

  The Board of Settlement of Disputes is obliged to examine the case and issue its ruling within 10 days from the date of the receipt of the complaint. The rulings by the Board of Settlement of Disputes will be final and enforceable within 10 days after the date of serving notice to the parties concerned, and will be executed by the Judgments Executing Section of the Justice Administration.

Employment of foreign nationals

All the employers of workplaces established in the Zone should, as far as possible, satisfy their labor requirements by employing Iranian workers, but if necessary, they can use the services, expertise and skills of foreign experts, subject to the conditions set forth in the relevant Law and regulations. Never the less, according to the relevant law, the number of foreign employees shall, in any case, not exceed ten percent (10%) of the total number of persons employed in each Zone.

 The Labor and Employment Services Office in the Zone will issue a work permit, upon the request by the Zone Authority. Foreign nationals who work in the Free Zones shall have to train Iranian employees in their field of expertise during the period of their employment.
 Workplaces located in a Zone are required to prepare and communicate to the Zone Authority’s Labor and Employment Services Office, once every six months, a list containing the name, nationality, expertise, job and wages of their employees.