Dear all,
Retrenchmnent is a statutory termination of service of workmen under ID Act. I agree with Mr.T.Madhu as regards the gist of sec.2 (oo) of I.D. Act, which defines the parameters of 'retrenchment'.
Basically, any termination of the workmen other than by way of punishment by way of disciplinary action and the four excemted situations, any termination of workmen will be contrued as retrencment only regardless of the nomenclature.
What is relevant as regards retrenchment is that a workman retrenched on completion of one year (240 days) is entitiled to compensation as required under sction 25 F of the I.D. Act. In the event of the employer not paying retrenement compensation as requierd u/s 25 F of the Act, the relief for the terminated employee is reintstament with back wages.Hence employers and HR Managers be on gaurd !
As regards termination, it is applicable both for workmen covered under ID Act and also any other employee not coverend under ID Act.
Termination could be of two kinds viz.(i) termination simplicitor and (ii) termination consequent to disci;plinary action.
As regards, termination simplcitor, notice pay must be given by the emplyer as per the Terms of Appointment / Service Contract / Company Standing Orders together with statutory benefits such as Gratuity, EPF as applicable and leave enchansment, if any.
If an employee is terminated consequent to disciplinary action, normally he is forefieted of gratuity. In such a situation it would be prudent for the employer / HR managers to consuult legal experts before issuing termination orders, as any terminated emplyee consequent to discplinary action is bound to approach courts. Even a procedural mistake in terminating an employee consequent to disciplianry action will be having a nullfying effect in the court.
A.Irudayam
Advocate- High Court- Madras
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