Penalty structure should be consistent with the labour laws of the land. When we design any penalty or take action against employee's "misconduct" it is within the purview of labours laws of India. Secondly, in the last 62 years of independence, Supreme Court of India or High Courts of the various states of India have given large number of verdicts. These verdicts also acts as guidelines for the interpretation of the labour laws.
Therefore, it would be prudent to raise this query to some labour consultant of your country.
Dinesh V Divekar
25th August 2009 From India, Bangalore