dr.piyush_caroli Started The Discussion:
Respected Friends,

I came accross some posts in which there were issues pertaining to the resignation of the employee being asked by the employer. I am keen to know why the employer prefers to ask for a resignation rather than terminate the employee. What are the modalities associated. Also what can happen if the employee chosses not to resign from the organisation and carry on in the company if there is not concrete reason. How does an employee ensure that all his dues will be paid in the Full and Final and what happens to the variable component payment in this case if there are no clear directives in the appointment letter or the company policy.

Request to please share your knowledge on this topic.

Posted 4th January 2012 From India, Delhi
If the company is unable to continue or due to some financial problems they may require to reduce the manpower and for this they may have to terminate the employees, instead the employer communicate the employee to submit his resignation so that they can clear his dues & complete all the formalities like relieving letter / service certificate etc., this is a win win situation.

If termination comes in to picture then it is a long and very critical process, in case of termination the reason for leaving will be mentioned as termination which could be a critical scenario for the out going employee, even the employee challenges then its a time consuming process. In general every appointment letter consists of notice period and the management can issue a notice and after completion of notice period they can settle accounts.

If the management asks the employee and the employee respondes positively the management shall clear the dues even the employee don't responds positively also it is mandatory for the employer to clear the dues under payment of wages act and the employee can approach leagally or the concerned labour department officials.

As far as Variable pay is concerned there should be a document / agreement and both parties should abide by the agreement and clear the payments. If there is no document on variable pay then it depends on the wish and will of the mangement and the employee can't insist on the same. Normally every organization will issue a clear document on payment of variable pay along with the targets (monthly / quarterly / half-yearly/ annually) measurement creteria etc., basing on which the employee claims and the management clears the payment if not it depends on the gratus of the management. The employee should insist for the document at the begining where the management declared such type of incentives.
Regards -kamesh
Posted 4th January 2012 From India, Hyderabad
There are various reasons for the company to ask for resignation instead of terminating the individual.

Firstly, it is to maintain the dignity of an individual and secondly it is to keep the scope for future reference intact. It is possible that your prospective employer will accept you more openly when you say that you resigned from your job for X, Y, Z reasons instead of telling that you got terminated for X, Y, Z reasons.

When the company asks you to resign, they also make sure that all your dues get cleared. However, you are expected to maintain the confidentiality of the agreement between you and the employer and not share about it with anybody.

I hope this will help. Let me know if you have any doubts. Stay in touch and take good care of yourself.
Posted 4th January 2012 From India, Mumbai
Dear Piyush,

Q-I am keen to know why the employer prefers to ask for a resignation rather than terminate the employee.

A-When an employer ask for a resignation rather than termination the main reason behind it is-The employer has to pay basic Pay (Basic+DA) to the employee dpending on the notice period..

For an example:IF in a company,the notice period is of 1month,then in case of termination the company has to pay 1 month basic Pay (Basic+DA) to the employee.While in case of resignation if the employee serves complete notice period,there will be no deduction,but if any employee leaves the organization without serving the notice period/in between the notice period then employee has to pay for it to the company 1 month basic Pay (Basic+DA).

Q- what can happen if the employee chosses not to resign from the organisation and carry on in the company if there is not concrete reason. How does an employee ensure that all his dues will be paid in the Full and Final and what happens to the variable component payment in this case if there are no clear directives in the appointment letter or the company policy.

A-At the time of seperation all companies clear the dues of employees depending on the time frame mentioned in black and white.If they do not clear the same,you can sue them in labour court.

Best Regards,
Sunita Dhoundiyal
Posted 5th January 2012 From India, Delhi

Dear Piyush,

There is more than one reason for this modus operandi. Let us see them-
From Employer's point of view:
1. To reduce the man power without facing complex problems.(including weed out unwanted employees)
2. To avoid legal implications involved in termination
3. To acquire freshers, to infuse fresh blood in order to look latest and uptodate
4. Trimming man power for optimum utilisation and to cut down costs, especially when projects gets completed and new projects still awaited.
5. Sometimes to keep the total manpower within limits to avoid PF/ESI etc.
6. Sometimes swapping takes place for some strategic reasons triggered by market compulsions, mergers, de-mergers, amalgamations, dissolutions/closure etc.
From employees point of view:
1. As others said to keep the CV intact, without any black mark
2. Easy to get relieved when another offer is on hand.
3. It is always better to part like as friends, who knows one has to come back to the same employer if situation warrant. Sometimes it gives better bargain.
4. Will help in having business tie-ups, associations, mutual benefits would be easy.
When termination is better (not on negative reasons):
In case of closure -
A retrenched person will have exemptions/preferences for future careers prospects, in mergers/amalgamations, tax saving, receive full terminal benefits on notional basis etc.

Can go on like this. With regards,

Posted 5th January 2012 From India, Bangalore
It is clear that if Employee agreed to give resignation that well & good if he /she not agreed then give him /her notice peried ( as mentioned in appointment letter )or in lieu of notice peried pay.But conditional he /she should confirmed ,otherwise if he /she on probation or training management can releave same day & F & F settlement should be clear with in 24 hours.

Posted 6th January 2012 From India, Velluru
Dear Friends,

If any employer terminate the services of their employees( say in workmen category under 2(S) of the ID Act), it attracts Sec. 25F of the ID Act. The employer has to pay the termination compensation. Without complying with the Sec. 25 F, if they terminate any employee, legal consequences are there. To avoid such legal complications, the Management prefers the employees to resign. For this Management may offer some financial benefits to employees for resigning.

In case of Supervisory/Managerial category, it all depends on the terms of appointment letter. In the appointment order if there is any clause on termination, and if it is mutually agreed by both the parties, termination can be effected with notice period or pay in lieu of notice period.

Sr. Manager HR
Posted 6th January 2012 From India, Bangalore
one of my friends worked in financial services his boss forced him to resign from the post.
what he do now? he wants the job also there is no strong reason for resign.he is a confirmed employee.last month salary also got from company.
pl. guide him.
Posted 6th January 2012 From India, Nagpur
Well, I don't think your friend has told you the entire truth. No boss will ask his team-member to resign just to have fun. There must be some strong reason, either about his performance, or discipline, or insubordination. Check with him again.
Posted 6th January 2012 From India, Mumbai
it is always to help the employee go out with track record and it is also to pardon him. There is always flexibility in corporate sector
Posted 6th January 2012 From India, Madras
Dear Shreya,

the damage is already done if he would have sought the advise before tendering his resignation a lot could have been done. But now the probabilities is very less. Please ask your friend what reason did he quoted for leaving the job in the resignation. Only then i will be able to tell you something about it. Please elaborate on the circumstances in which he was asked to tender the resignation. now the case has become more circumstantial so state the full story and we may get a solution to the problem. Feel free to call also if required.
Posted 6th January 2012 From India, New Delhi
thanks friends . some more concerns left -

1. what happens in the case where an employee rejects the advice of the management for the resignation and prefers to continue as there is credible reason for terminating him. Can the organisation still terminate his employement. How can he safegaurd himself in this case.

2. In case he accepts the advice and puts his paper and completes the hand over process and serves the notice period is it possible to give the terminate the employee with back date i.e before the date of his resignation during his notice period. how can an employee react to this condition

3. Is it possible for an employee to safegaurd his employment in case of whistleblowing. In case of corporate lobbying pressurising his retrenchment is there any legal immunity provided to the worker

4. how long does it takes to reach a judgement if the employee decides to go legal and what is the process.

5. is it possible for the employee to sue the company officials on grounds of mental trauma and defamations if he is able to prove his innocence in the court.

thanks for the help
Posted 7th January 2012 From India, Delhi
Dr. Piyush, you have been making some serious allegations against the company, therefore, it is just appropriate for us to know the size of the company as well as the role and designation of your friend.

Just to give you an overview:

1) Yes, if the person refuses to accept the "suggestion" of the employer to resign, he can still be terminated. The reasons for termination can be any of the following: Insubordination, Indiscipline, Working Against the Company etc.

2) If the suggestion of the employer is listened to then the last day at work is considered as the final. Letter issued by the company cannot be back dated.

Question number 3-5 can only be answered if I know the size of the company as well as the role and designation of your friend. And also if the company is listed or not.
Posted 7th January 2012 From India, Mumbai
Thanks a lot Sanjeev for taking the time out for replying to the post ..

These are all generic questions which I thought could be linked to this topic and hence posted them as queries for the benefit of my friends .

Would it be possbile for you to kindly answer it for both a small sized,mid sized and large sized company for listed as well as not listed. This will benefit a lot of people who read this post.

thank you for your guidance .

Posted 8th January 2012 From India, Delhi
hi , i would like to understand , if an employee is being asked to leave the company, for only fulfilling egoooo.. how should one tackle the situation ,also how he can teach a lesson to the concerns in ethical manner (legal) should he issue a notice to the company or to the concern manager , can he file a complaint against the concern at police station. what should be a note of compensation asked...

Please suggest your opion

Posted 8th April 2013 From India, Mumbai
I lead Reputed concern TN state head position since sep'14 . Based on my hard working and speedy in project completion, I have been awarded for star performer in Jan'15. Earlier leader who resigned and out of company is very close to my superior and making trouble to me through his friend who is in my team. Recently (march'15), my NHQ boss decided to elevate me from state to zonal head from may'15. This is not tolerated by my superior (this position handling additionally by him for past 6months) and joined along with left out former leader and tried to escalate unproven allegations over me. But he strongly taken upon with my big boss by brain washing him in his own style.
Suddenly, without any intimation, HR called me to submit my resignation without any delay. I asked the reason , but they don't have any valued reasons and itself management decision. Initially I have not accepted and took up to state higher levels and they told they are also helpless in this management politics and advised me to resign for getting my settlements decently.
I send a mail to my boss, HR with requesting for 2months time. My boss agreed and replied to HR to accept my request. But after my resignation, HR confirmed that no time extended and will be relieved on the same resignation day. I am having 120 days privilege leaves (can be adjusted for notice period of 90days) and annual variable pay expected in this month are affected.( variable pay from April to march every year, but HR told this amount will not consider in F&F).

Till now, colleagues in my company came to known that resigned by me not under forced resignation. Now I am jobless and getting job for my position is not an easy task.
Expecting good suggestions /advise to defend my company legally for justice.
Posted 7th June 2015 From India, Tiruppur
Expecting advise/ reply from the experts for the query posted by me. Thanks & Regards, D.SELVAKUMAR
Posted 14th June 2015 From India, Tiruppur
If an employee has been asked to leave because of some misconduct unknowingly. He got all the dues and relieving letter and experience letter too. Will his Verification from other company will be negative as it is involuntary.
Posted 26th June 2015 From India, Delhi
Resignation is better then termination . You will get all the benefits at the end of your separation mention in the appointment letter..However you couldn't get or asked for anything from the employer if you are getting terminated .
Posted 26th June 2015 From Pakistan, Karachi
Since you worked in TN you are governed by TN Shops and Establishment Act. Since you resigned giving two months notice, employer could not have relieved you before expiry of two months. Thus your discharge is illegal. You are thus governed by section 41 of the Act whereby without reasonable cause and one month's notice you could not have been dismissed. The discharge being illegal is null and void and you are entitled for reinstatement. File complaint before the inspector under the Act. If you do not want reinstatement file civil suit for claiming damages from the employer.
Posted 26th June 2015 From India, New Delhi
Recently received my relieving letter mentioning with date of resignation and date of Relieving ( I.e 07.05.15 and 08.05.15). Will this affect my new job search?
While calculating my F&F settlement, they deducted 90days as notice period and considered less days for encashment. Now I am not accepting my settlement statement and requested for 90days pay or till date of my relieving request and also I am getting eligible for max encashment. Still no reply for more than 20days from HR.
What action to do from my end. Pl. Advise.
Posted 15th July 2015 From India, Tiruppur


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