Understanding Termination Clauses: What Laws Should I Include in My Handbook?

Hi all, I would like to add a termination clause to my handbook. Please help me with a few laws that allow an organization to terminate their staff on specific grounds. I am hoping for a positive reply.

Regards,
Lalita

You must see Sec 25F of the Industrial Disputes Act and your local Shops & Establishments Act. The termination provision should match that.

Regards,
[HR]

[Email Removed For Privacy Reasons]
[Phone Number Removed For Privacy Reasons]

Dear Lalita,

as per Industrial Disputes Act an employee can be terminated on following grounds without getting into the purview of definition of Retrenchment u/s 2(oo) :-

Dear All,

Here, I have a query! What should be done if an employee continues to take leaves on the grounds of illness, while his other teammates are informing that the employee is not interested in the job and is looking for other opportunities? Can the company terminate that employee due to continued leaves?

Kindly suggest.

Thanks & Regards,

Deepak Jain

Dear Lalitha Chandrasekhar,

Sec 2 (oo) of the Industrial Disputes Act deals with the simple termination of an employee of any organization without attaching any stigma. In other cases, Section 25 F enunciates the procedure for retrenchment. No employee shall be terminated without being given a reasonable opportunity and following the principle of Natural Justice. If you want to incorporate a Termination clause in your Standing Orders/Handbook/terms and conditions of employees to make it applicable to your company employees, the termination provision shall be relevant to the provisions of the above Acts. Additionally, you have to introduce a mechanism for disciplinary proceedings, including a list of such acts that would amount to misconduct.

Dear Sir/Madam,

I need a suggestion! If an employer wants to terminate a worker due to continuous absenteeism who joined before 15 days and remained present for only 10 days in the company. In this case, whether we need to give him notice or not? What should be paid to him as full and final payment, except wages.

Kindly help.

Thanks and Regards,
Raj Kumar
HR Executive
VRLA Manufacturing Co.
Himachal Pradesh
Mob No: 9218534004

Dear Deepak,

Continuous leaves can be a reason for terminating an employee, but it is not a substitute for disciplinary proceedings. You have to deal with the situation calmly and patiently.

In my opinion, please follow the steps below:

1. Without wasting time, issue him a warning letter stating that he is absent without authorization and advised to report to duty with a proper explanation for his absence. Give him a week's time. If he does not show up after that,

2. Issue him another show cause notice citing the relevant extract from the employee handbook or standing order which deals with continuous absence. Also, mention that such absences disrupt the smooth functioning of the organization and give him another opportunity to explain. Whether he shows up or not,

3. If he does not show up, issue him a charge sheet and send it through Reg AD and speed post. Keep the receipts safe as they will be helpful. The charge sheet must outline the period of unauthorized absence and state that no explanation has been received. After that, initiate the departmental inquiry.

4. If he shows up, ask him to submit proof of his absence and regularize his leaves with a written explanation. Then issue him a charge sheet stating that his explanation was unsatisfactory, describing the period of unauthorized absence. After that, initiate the departmental inquiry.

For any further clarification or issues, feel free to call me at 9313907096.

Kamal Kant Tyagi

Dear All,

My view is that placing excessive emphasis on termination procedures in the appointment letter can lead to negative feelings among candidates and new employees. Therefore, it is advisable to create a separate document outlining disciplinary rules and procedures, which should be provided either on the first day of employment or along with the appointment letter. Additionally, references to these disciplinary rules and procedures should be included in the appointment letter.

An example of such a policy is outlined below:

Action will be taken under the disciplinary procedure in cases of:

• Misconduct, for example: lateness or unauthorized absence.
• Poor work performance, for example: not working diligently or to the best of the employee's ability, and not maintaining proper records.
• Gross misconduct, for example: dishonesty, physical or verbal abuse of staff or volunteers, and being intoxicated at work.

Procedures for:
a) Misconduct
b) Poor Work Performance

If an employee fails to meet the required standard of conduct or work performance, or is unable to carry out duties, the following procedure will be followed:

1. Verbal Warning - The first stage will involve a verbal warning by the Departmental Heads. This warning will outline the necessary steps for improvement, any required training, and a review date. A record of the warning will be kept in the employee's personnel file.

2. Written Warning - If the employee does not meet the required standard after a verbal warning within the specified time frame, the next stage involves a written warning from the HR Head. This warning will state that failure to improve conduct or work performance may lead to a final warning and potential termination. A copy of this warning will be retained in the employee's personal file.

3. Final Warning - If the required standard is still not achieved, a final written warning will be issued by the HR Head indicating that termination may result if there is no improvement within the set time frame. A copy of this warning will be stored in the employee's personal file.

4. Termination - If, despite adequate warning as per the procedure above, an employee's conduct or work performance does not meet the required standard, termination will be considered. The decision for termination can only be made by Top Management.

The warning system aims to ensure that employees understand the nature of the complaint and are given time to enhance their conduct or performance to the necessary standard.

Examples of misconduct that will be addressed under this procedure include unsatisfactory time-keeping, attendance, performance standards, misuse of company property or premises, verbal abuse, refusal to comply with reasonable requests, unauthorized absence, misrepresentation of the company, and inappropriate behavior while representing the company.

Procedures for Gross Misconduct

Gross misconduct entails actions that severely breach the trust and confidence between the employer and employee. Such actions include theft, fraud, falsification of records, unauthorized equipment use, assault, fighting, impaired responsibility or performance due to alcohol or drug misuse, harassment, or discrimination.

In cases of established gross misconduct, an employee will be terminated without warning and without payment in lieu of notice, as specified in the employee's appointment letter.

Best regards,

Dear Pradeep,

Your suggestions are good and welcome up to the Gross Misconduct Part, but in my opinion, EVEN IN CASE OF GROSS MISCONDUCT, YOU CANNOT TERMINATE AN EMPLOYEE STRAIGHT AWAY. The first thing a judge would ask in a Labour Court is if you have given any chance to the Employee to explain his position. There are a number of judgments of the Supreme Court which state that if you are terminating an employee in the case of theft, willful disobedience, or any such gross misconduct case.

Even the Supreme Court says that if you terminate any temporary employee due to any misconduct, you have to give him a chance to explain the situation. So never terminate any employee without an inquiry. Even if he says that he has committed any misconduct of a grave nature, do not take it lightly and jump to the conclusion of terminating him straight away. Even in such a case, hold an inquiry and record his confession in the proceedings, issue him a show cause as to why his services should not be terminated, and only then, if he submits any explanation or not, issue him a termination letter.

Thanks,

Kamal Kant Tyagi