Terminating an Employee Without Notice: What Are the Legal Penalties and Liabilities?

Hello all,

Please provide me with information about the procedure for terminating an employee without notice. Specifically, I would like to know:

a) What penalties are incurred when terminating an employee without notice?
b) What is the minimum notice period required by law to terminate an employee?
c) What are the liabilities in terms of payment to the employee if a notice is received from the labor court?

Thank you.

Dear Ms. Unnati,

Greetings for the day:)

Answers to your queries are as follows:

a) There is no penalty if you terminate a labor with a genuine and justifying reason, provided you have sufficient evidence for that.

b) The minimum notice period should be as per the Contract Letter/LOI/Appointment letter. It may be a week, fortnight, a month, or 3 months, etc., as mentioned in the Contract Letter/LOI/Appointment letter.

c) Firstly, you are not liable to pay as per the notice received by you. Secondly, you can pay as per the terms and conditions mentioned in the Contract Letter/LOI/Appointment letter, or you can challenge the amount given in the notice if you think it is unfair.

**But you have not mentioned the details of the termination made by you and under what circumstances. Therefore, it might be possible that you have to pay as per the notice if the labor complaint is genuine. For appropriate suggestions, please explain the situation.

# I have replied only on the basis of a common situation. It may differ from case to case according to the details of each & every case. Please consult with your counsel before taking any action.

If ambiguity still persists, feel free to contact the undersigned.

Dear,

I feel that the contract of service between labor and employer is governed by the Industrial Employment Standing Orders Act, 1946 (SO), and no other agreement/loi can override the Standing Orders made between workmen and union.

If no such Standing Order exists, Model Standing Orders (MSO) are applicable in such case.

Answers

1. As per MSO/SO, notice shall be given to permanent workmen in case of termination. Otherwise, it ultra vires SO and attracts section 13a1, i.e., the following penalty:

"An employer who does any act in contravention of the standing orders finally certified under this Act for his industrial establishment shall be punishable with a fine which may extend to one hundred rupees, and in the case of a continuing offence with a further fine which may extend to twenty-five rupees for every day after the first during which the offence continues."

2. As per MSO central rules, notice is as follows:

"13. Termination of employment.--(1) For terminating the employment of a permanent workman, notice in writing shall be given either by the employer or the workman - one month's notice in the case of monthly-rated workmen and two weeks' notice in the case of other workmen: one month's or two weeks' pay, as the case may be, may be paid in lieu of notice.

(2) No temporary workman, whether monthly-rated, weekly-rated, or piece-rated, and no probationer or badli shall be entitled to any notice or pay in lieu thereof if his services are terminated, but the services of a temporary workman shall not be terminated as a punishment unless he has been given an opportunity of explaining the charges of misconduct alleged against him in the manner prescribed in Paragraph 14.

(3) Where the employment of any workman is terminated, the wages earned by him and other dues, if any, shall be paid before the expiry of the second working day from the day on which his employment is terminated."

3. If you terminate the service of the labor other than as punishment, then it comes as retrenchment as per the ID Act, 1947. In such a case, the court may order you to pay the retrenchment compensation, which equals 15 days of average salary for every completed year of continuous service along with the back wages and notice pay.

Regards,
Ravi

Dear Mr. Kapil Dev Singh,

Thank you for sharing your opinion. I have another issue to discuss. I was terminated from the organization based on incorrect remarks made by my senior to the HR Department. I received the termination letter without any notice period. Upon clarifying each point with the Managing Director and proving that the remarks were false, I received an email from the HR Department after 45 days stating that my termination was revoked with immediate effect.

The problem now is that HR mentioned during this 45-day period, the company is not willing to pay me on the principle of "no work, no pay." However, as the company accepted their mistake by revoking my termination, I believe I should not suffer any financial loss.

Could you please advise on which act I can claim if the company refuses to pay my 45 days' salary and what the procedure would be? Kindly email me the details at kishormanish2k5@yahoo.com.

I look forward to your prompt response.

Thank you.

Dear Ms. Unnati,

I would love to give you a suggestion, but I guess, in fact, I am sure the laws are different here.

Please adhere to Standing Orders as applicable, and ensure that misconduct is proven through the principle of natural justice before the Disciplinary Authority makes a decision. If the workman approaches the Industrial Tribunal or Labour Court, they will decide in his favor in the case of dismissal without a domestic enquiry.

(Rajiv Ranjan)