Just for clarification - as it was brought out in Pedro de la Rosa's statement to the FIA, drivers are not "employees" of a team but rather like "sub-contractors." They are paid to drive, but they are not technically team employees like tire changers, designers, etc.

Then, technically, wouldn't Alonso's contract simply have been canceled since the team couldn't "fire" him in the normal sense?

(On a different note, I believe that FA's contract breach was due to his lack of wearing the team-approved haircut!)