Reducing notice period if employee gets another job - CiteHR
Umakanthan53
Labour Law & Hr Consultant
Gopinath Varahamurthi
Mindhour Partner, Ass.professor/adm. Officer,

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While asking an employee to leave coz of downsizing can we include in fnf statement that if he finds a job earlier than two months then our notice period pay will accordingly adjust.
We don't want the employee to serve notice period and want to relieve him immediately.

dear anonymous,
When you have planned to downsize, convey the employee to find out a suitable job and give relief at the right time for his progress, life and betterment. You are very much well and gracious in this account, better inform the employee and do the needful. It is also good to get him relieved instead of notice period.

Dear friend,
The exit is necessitated by the right-sizing of the organization at the behest of the employer.
Therefore it amounts to reducing the surplusage of the employees and as such it amounts to retrenchment in respect of those employees falling within the definition of the term "workman" u/s 2(s) of the Industrial Disputes Act,1947. In such a case you have to follow the provisions of sec.25F of the I.D Act,1947 which prescribes notice or salary in lieu of such notice and payment of retrenchment compensation @ 15 days average wages last drawn for every year of service rendered by the employee. If you want to relieve the employee immediately do it by paying the salary in lieu of notice plus the retrenchment compensation on the date of relief itself.
Regarding other employees, you have to simply and strictly follow the clauses relating to exit in the contract of employment. If you are particular about relieving the employee forth with, better pay him the notice salary and relieve him. If anyone of such employees leaves in between before the expiry of the notice period, you have to pay him for the period he worked only.

Thank you for your response.
My question was can we mention this as terms of settlement that notice period money will only be paid till he finds another job against two months mentioned in appointment letter
Suppose he finds job in a month then we pay only for a month.

I think that I've already answered your question. To put it in other words, after the expiry of the notice period, whatever its duration may be, you are going to send him out; if he finds a job in the mean time and requests immediate relief, you are going to do the same by paying up to the date of his relief only. Therefore, there is no necessity of mentioning such a clause explicitly in the settlement.
Dear Anonymous and Dear Shri Umakanthan,
Here the case as given is pertain to downsizing, thus retrenchment and downsizing are different categories, retrenchment occur because of economy and production issues, failure to upgrading technology of the industries, obsolete way of working, when well trained employee are in pipeline and the men of present order may not found fit to the latest reforms, curtailing of operations from the earlier proposed to the present situation, where as downsizing occur due to excess of employees, shifting of operation one level to another level (complete shifting), closing of one unit of an organisation whom they cannot make fit into another units .. both are technical words and cannot be used vice versa, in the instant case they are down sizing, thus, immediately on getting another job they should relieve the person/employee without question, his pay and allowances irrespective of day of work should be given(should be paid two months salary), and the service letter should mention his good work and thankfulness to his services, the employee is not a burden but the organisation is curtailing its operation is downsizing, in retrenchment, the employees are found excess to the organisation so, we are curtailing the employee strength, thus pay and allowances and other things settled in accordance to the procedures, in downsizing, company itself can arrange for interviews and guide the employee, in retrenchment, we may ask the employee to get to the new job...
In your case you are downsizing because of your operational and other situations, so, squarely we have to guide the employee for the good cause..
Be always Gracious ...

Thank you all and Shri Gopinath. The downsizing is due to financial issues the company is facing. Thus no fault of employee. However management decided to let him and his department be separated. Since his salary is on a higher side they decided to put this clause that notice period to be paid till he finds another job or 2 months whatever comes first. I am of the opinion that he shud be paid for 2 months since it's not him who decided to move out or to not to work for the company during notice. Let me know if I am wrong.
Dear Anonymous,
Your approach is the best and I am the one of the dust appreciate you.
"All the good things must have hurdles to become Strong"

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