The matter of canceling a service contract often hinders the work of personnel offices of government and local self-government. Due to the specifics of labor relations between state and municipal employees, it remains unresolved in the domestic labor law. There is a controversy between the subsidiary application of general labor legislation norms and special laws that control the activity of certain categories of workers. It comes from the vague border between the scope of general and special norms of labor legislation in relation to state and municipal employees. Another reason is the limited legal regulation of labor relations with these categories of workers with application of the general norms of the current labor legislation. The article features approaches to resolving the issue of the possibility and legality of canceling a service contract in personnel offices of government bodies. The research was based on a critical review of the two existing opinions on the place of the cancellation procedure in relations with state and municipal employees. The author describes the legal nature of the cancellation and termination of the employment contract based on scientific literature. The article contains some recommendations on how to avoid the situation in which the representative of the employer does not have adequate legal mechanism for responding to an employee's failure to appear at work on the first day of the contract.