As per section 25F of the industrial dispute act you have to give a retrenchment compensation for 15 days for every completed year of continuous service. You have to serve one month's notice before retrenchment or pay slary therof to the Workmen. Furhter you have to give a notice in FORM P/Form PA depending on the applicablity of Chaprter VA or Chapter VB of the Act if the Central rules are applicable to u in otherwise cases please refer state rules. IF your firm is a Government undertaking or engaging more than 100 workmen in preceeding 12 months Chapter VB will be applicable. In these circumstances you have to take the approval of the appropriate government for retrenchment. If the retrenched person is already involved in any court case against your corporation, in such circumstaces it is better to take legal opnion.