Navigating Sudden Job Termination: Can My Friend Claim More Severance and Stock Options?

Hi all,

I have a friend who was recruited and immediately terminated because the company wanted to cut down on company costs. Some facts about him:
1) He worked there only for 25 days.
2) He was offered stock options.
3) He was paid one month notice pay.
4) In the previous organization, he spent a long time (more than 6 years).

My questions are:
1) Can he demand more severance (3 months gross)?
2) Can he demand the stock options?
3) He had a performance-linked bonus every quarter. What happens to that?
4) Is it legal to hire and fire in India for no fault of his? He was clearly communicated that he was terminated only due to his cost and not because of his non-performance.

Appreciate your response.
Thanks,
Madhu

First of all, let me say that it is unfortunate that your friend had to leave his new establishment soon after joining. As a cost reduction step, if a company decides to terminate any of its employees and follows the provisions of the Industrial Disputes Act or as per the Standing Orders of the company, there is nothing wrong. The company can proceed with retrenchment, and the last employee employed will be the first to be terminated. Though it is not necessary to serve notice or pay notice pay for those who have not completed one year of service (meaning at least 240 days of work in the preceding year), your friend's company has served notice or paid notice pay for one month. That is sufficient, and he cannot ask for more legally. Having joined the company after leaving a good organization with 6 long years is no ground for getting more retrenchment benefits from the present employer. Therefore, there is no legality in asking for more than what is offered to him.

Regards,

Madhu.T.K