Are Relieving and Service Letters Still Necessary in Today's Fast-Paced Hiring?

Hi all,

I have a hot topic to discuss. Nowadays, the importance of a relieving letter, service letter, and notice period has become outdated. Many companies hire candidates urgently without these letters.

I read in a magazine article that during interviews at new companies, candidates tell the HR department that having a relieving letter and service letter would require them to serve a notice period of 1 or 2 months. Due to urgent requirements, some companies ask candidates to join without these letters, while others simply skip the notice period and have them join immediately.

Let's share your valuable ideas with us.

Regards,
Shilpa U.

Dear Shilpa,

Yes, you are very right. It is really in practice these days.

But in my opinion, it's a bad practice as it leads to the loss of employees in terms of wealth as well as sincerity and respect. Even companies who engage in such practices may encounter similar problems. Employees who have been hired in this way may leave them in the same manner, even in crucial situations.

Moreover, it hampers the candidate's career as well because they may return to their previous employer, losing the faith of their current employer.

So, these practices must be stopped by companies.

Sometimes, it has been observed that it is the previous employer who does not release their employees if they wish to change, leading to the same situation. Therefore, if one has decided to switch, they should be allowed to do so in a systematic way without being forced to stay with the company. It is a loss for the company to continue spending on an employee who is not fully committed.

In conclusion, this practice is often a result of problems created by companies in releasing their employees.

Regards,

Amit Seth.

Hi Shilpa,

I agree with you on some points, but you are wrong in most ways. I am not contradicting your point; what I want to say is that the importance of the relieving letter, notice period, and service letter still exists, and the practice of issuing them is prevalent in the current market scenario.

I work in the manufacturing industry as an HR Executive, and we still ask for a relieving letter from the candidate once he joins our company. Moreover, they provide us with the relieving letter, notice period, or experience certificate even before we ask for it.

So, the practice is still in existence; it's just losing its importance in MNCs and similar companies where they may have a different philosophy of recruiting.

Regards,
Ankit

Hey,

But don't you think, Amit, that if we recruit any candidate or person without the revealing letter, that may create a big issue in our company? For instance, if you hire someone in your company without asking for the experience letter or revealing letter, how can you be certain that the person has the specific amount of experience?

Regards,
Ankit

Hi Ankit,

I agree with you. However, in many software companies, they hire candidates even without these certifications. I have seen it happen.

Regarding your point about how can one be certain about a person's years of experience, they often provide an Appointment Letter that specifies the joining date.

Thank you.

Hi Shilpa and Ankit,

We can't blame someone who is engaging in such practices. These are us HR people and consultants who have started such practices. To stop such systems, we will have to change our attitude towards hiring. We must give them some time to serve the notice period and complete their formalities at their end. Moreover, we should also help them to successfully complete their exit procedures. Lastly, we must have some restrictive policies to prevent such practices.

Regards,
Amit Seth.

I guess it is impossible to lay down a hard and fast rule in this regard. We, HR professionals, can always put our foot down and say 'no relieving letter, no hire'. But we might lose some excellent resources and miss some hiring targets in the bargain.

So the solution is perhaps insisting on a relieving letter in all cases and making an exception in really exceptional cases, where we MUST hire the candidate in question, or the reason advanced by the candidate for not producing the relieving letter appears to be genuine. It would also be a good practice to have a background check done on such candidates with the help of a screening agency.

Hi,

Thanks for your valuable suggestion. One thing I want to express is that we have to take care during the background verification time, i.e., Verification Check, as some may give fake references. It happened within our organization where a candidate produced fake appointment letters, salary slips, etc., but during the background verification, the truth came out.

Regards,
Shilpa

Hi Amit and Shilpa,

I am not going against any one of you. The only thing I pointed out was that this practice still exists and is a valid one.

Shilpa, as far as you said, even if the candidate shows the appointment letter, how can one be so sure that he/she is not working for the same company after joining your organization? This type of case has happened in our industry (not in our company but in another company in our industry).

There was this candidate who showed his joining letter, and after getting the appointment, he was working for the new company as well as working for the previous organization (part-time). In that case, the company traced this and found out that his absenteeism was high in both companies.

Now Amit and Shilpa, what do you say?

Regards,
Ankit

Hi Ankit,

In that case where the employee is working for two companies alternately... According to my opinion, whether I am right or not, I don't know, but I will express my opinion.

For that employee, we can give a warning by showing the list of leaves he has taken and tell him not to take that much leave. If he continues to do the same thing, then we can tell him to resign from the job.

Am I right or wrong? Please suggest, and if you have any other ideas, then let me know as this situation may occur to anybody.

Thanks and Regards,
Shilpa U

Hi all!

Some of the so-called CMM Level 5 companies, ISO 9001 companies, big MNCs are not asking for these relieving letters these days, especially in the IT industry. As the HR department of these companies has pressures to hire for a specific project, the HR department is bypassing all these and recruiting candidates without proper documentation. The HR people have to question themselves whether they are following the right practices or not. They need to be honest, respect values, and have integrity.

Thanks,

Hi Ankit,

It is very true that if somebody is showing you the appointment letter of a previous employer, then he is not working with them. He might still be associated with them or might be absconding from there. This situation may lead to dual employment, which is against the law.

Therefore, we must ask for a relieving letter and an experience letter from the employee when they join. It is essential to cross-check with the references they provided.

To prevent absconding cases, we should issue a warning letter to those who are absent for a long duration without seeking approval from their seniors. The letter should clearly state that the employee is directed to resume their duties within 48 hours of receiving it. If the employee fails to resume, we must send another letter clearly stating that failure to resume services will lead to termination from the organization.

Subsequently, a termination letter can be sent. It is advisable to send these warning letters and all such correspondence through registered mail so that we have valid support for any termination actions.

Hopefully, these measures will help prevent such activities in the future.

Regards,

Amit Seth

Hi :D,

Yes, relieving and service letters have really lost their importance. My past employer also did not give me a relieving letter as he was not willing to relieve me at all. I joined the new company and there I submitted only my certificates and Form-16 from my past employment. Hence, I also stopped asking for relieving letters from new employers.

Regards,
Narendra

Dear All,

This is undoubtedly a serious issue in the industry today. Somehow, we need to find a solution to this. I am an Executive HR in a software firm, and I don't entertain candidates without a relieving letter. I have personally faced this problem to the max. Employees hardly bother about relieving letters. They quit just for a slight hike, and sometimes it may be because of the domain they are interested in.

Well, I guess legally speaking, there should be some kind of law that addresses dual employment. Probably if we know the company the person is currently working for, we could file a case against both. However, I seriously have no idea if it works. In case it does, what is the procedure for it?

Regards,
Arshiya

Hi Shilpa,

It is equivalent to "No one can change you unless you want yourself to get changed." And hence the company must change its policies accordingly. I don't know how they allow the employees without the letter from the other company. If they do so, then what will the new employee think about the company where he joins and what will be his loyalty towards the company?

Hope you have a better answer for your question.

Regards,
Gayathiri

Hi,

I am in total agreement that the relieving order is slowly losing significance. The blame can be attributed to the mad rush for talented and sometimes not-so-talented people. The new employer is only worried about filling up the vacancy as fast as possible, and the employee is switching to a better-paid job. But what you have to remember is that the same thing might happen to you too - the employee is going to leave without serving the notice period and without you issuing a relieving order.

I think as HR professionals, we have to ensure that we do not encourage such things. If an employee you have selected indicates that he/she has to serve a 2-month notice period with the current employer, they should be encouraged to do so and leave the current company only after the necessary formalities are complied with. It is a good practice, and let us all get together and remove this malaise from the system.

Regards,
Vasudev

Hi, Shilpa.

What I want to say is recruiting a candidate without having his relieving letter is common not only in the IT industry where there is a huge demand for manpower, but it is also common in many other industries. I am working as an HR generalist for a major infrastructure company. There were cases when I was forced to recruit candidates for some top positions without receiving their relieving letters due to pressure from my superiors. Many companies don't really prioritize these backup documents as they want the candidate to join them immediately. Reasons for this could include:

1) That candidate might be a top performer or a critical member in his previous company (a competitor to the current company).

2) Due to very urgent business needs.

3) The candidate is willing to accept a lower salary package.

4) Recruitment targets for HR (PCMM timelines), etc.

I feel we really can't definitively say whether this practice is right or wrong. It should be decided on a case-by-case basis.

Regards,

Harsha.

Hello Friends,

Its an interesting topic to have debate on. I went through the valuable suggestions of all of you. I would like to share my views on this topic. All the new joinees must be asked atleast for the relieving letter without which they should not allowed to join. If we don't ask for the relieving letter it might have very serious implication on us. It might be possible that the person had not resigned / relieved from previous company. And people indeed follow such practice due to the their apprehensions of new work environment. They first want to see the atmosphere prevailing in the new organization before resigning from the previous company. In such cases if the person has not resigned/ relieved and has been on the rolls of both companies, the previous employer may sue the new employer of that employee. While the new employer may also land into the loss if the said employee leave the new company to continue with previous company. I work with Real Estate Company at Delhi and we faced such critical situation where we hired a person at VP level who told us to submit the relieving letter later on and due to his high profile we agreed but later on we found that he did not resign from previous company and still was on its roll. Ultimately we had to ask him to leave us. To avoid such unfortunate situations we must ask for the relieving letter without fail.

As far as urgency is concerned we may hire the person on urgent basis without giving her time to serve notice period and we may pay an amount to him/her against shortfall of notice period. What I mean is that if the said person has to join urgently due to which he/she cannot give notice to previous employer he/she may pay the amount to previous company against the shortfall of notice which should be compensated by the new employer on production of “Short Fall of Notice Certificate” by previous employer. The same practice is being followed by most of the professional organizations now a days because no body wants to give much time to join for the critical position and prefer to pay for the shortfall of Notice.

Amit Goyal

Dear Amit,

Thank you very much for your valuable inputs. Frankly speaking, I wasn't aware that not asking for a relieving letter might result in this extent. Also, in my view, people who join top positions are often let off without asking for the backup papers. In these kinds of situations, whom do you think should be blamed - the HR Department or the Department heads? Very often, the HR Department has a lot of pressure from the Department heads, due to which the backup papers are neglected.

Regards,
Harsha.

Hi Harsha,

Yes, you are very right that in most cases, the HR remains under pressure from HODs to hire employees even if they do not have the requisite documentary proofs. But we in HR must constantly ask for the documentary proofs before releasing the appointment letter. In most cases, the relieving letter is not issued immediately, and it takes some time. In such cases, we must at least ask for the accepted copy of the resignation letter along with the written undertaking by the new joiner that he/she has already resigned on such and such date and will be relieved by such and such date. As soon as he/she gets the relieving letter, the same will be submitted. Also, the name of the contact person in HR of the previous company along with the company address and contact numbers must be taken on the same undertaking. We may now make an initial inquiry from his previous employer as to whether that person has resigned or not. This will keep us on the safer side, and we will not be liable for any legal action by his/her previous employer.

Amit Goyal

Hi,

I am an HR Executive working with a Pharma MNC. It's very interesting to see that the discussion is in an exciting mode. Nobody can rule out the importance of a relieving letter, even if HR practices are becoming modern day by day. In my opinion, a relieving letter is the certificate from the previous employer that confirms the specific employee has completed all duties, paid all dues, such as any loans taken, and there were no issues against him.

We never encourage this kind of practice in our company.

With Regards,
Deepak

Interesting Topic

Many times during a recruitment process, if we find an ideal candidate for your organization and as an HR person, you may notice that if a candidate resigns from his/her present company, then that company will try to negotiate with the employee and may be able to retain him. So at that time, we have to ask the candidate to join immediately. If the candidate has good job knowledge and fits well into your vacancy, then the relieving or experience letter does not have any relevance.

Hi Shilpa,

In my view, the relieving letter has not at all lost its importance. Maybe for some junior positions, you would have noticed a casual practice, but for key positions, the relieving letter is a prerequisite. We follow this sincerely. We do not issue the appointment letter until the relieving letter from the past employer is produced. In the meantime, we ask the candidate to submit a copy of his resignation with an acceptance letter if he needs time to receive the relieving letter from his employer.

It is a very important document in the checklist of recruitment and selection and must not be ignored.

Hi folks,

First of all I would like to say thanks to Shilpa for initiating such a wonderful topic.

I think all other friends have already given their views on this. I am working as an HR in IT Co. in Bangalore and till now I never faced this sort of problem. We strictly collect all the documents from the guys who will join us and we initiate BGC before the guy join us so that by the time the guy join we'll get the BGC report.

If the guy is in the notice period then we'll try to buy his/her notice period and if his/her employer is not ready to relieve him/her then definitely we'll wait till s/he gets relieved. I think this is the best practice than just blindly recruiting some one who doesn't submit any of their documents. It is not only a bad practice along with this we are giving an opportunity to the guys who can habituate this practice and might apply the same technique even with us.

These days' fake documents are working well than the originals so I suggest all the HR friends to be careful while recruiting and these kinds of guys can pollute the organization culture and environment.

These kinds of practices we can find mostly in the small companies who have just started or who are in desperation to get some one for the project. HR folks ensure that you recruit the right person at the right place if you are not sure of getting like this then you can groom some one internally for that position by providing training. That works well we do the same practice in our org.

Let's see what other friends have to say about this.

Best Regards,

Kalyan. :D

Hello all,

Now that we have received many views and suggestions, we should wrap up this topic here to start a fresh one. I would like to introduce another similar topic on reference checks. Please refer to this new topic under the subject "Employee Verification/Background Check."

Hope to receive good suggestions from all of you over there.

Amit Goyal

Dear Friends,

Indeed, a very debatable topic. I have observed that the contracting/temping companies use this modus operandi to get their resources on board faster with their clients. There have been instances where I came to know that these consultancies/agencies force the candidates to abscond from their current companies. There needs to be a check/request from the end client's side on these resources for their documents. But again, there is a rumor that an IT company in Bangalore even gives out a fake experience letter from their side to avoid these issues. God save the crusaders of this cause.

So it clearly depends on the urgency and the criticality of the project that forces these decisions. Your thoughts, please.

Hi,

Yes, I agree with you that there are some agencies which provide fake experience to the candidates and they will give reference numbers of those institutes for verification. When validating, we should be able to differentiate between the original and fake projects by probing with different types of questions.

In order to avoid this, it is better to conduct a written test of all the technical skills we have decided to ask about. Let us consider some more suggestions from our members.

Regards,
Shilpa

Hi All,

A very interesting discussion indeed and very valuable suggestions from all. Anyways, one question still remains unanswered – how to really stress the importance of obtaining relieving letters for new joiners when the HODs want them to join immediately. I have observed this in my own company; we are in construction, and often civil engineers abscond from their previous companies, claiming that they were not relieved. Additionally, the HODs want new joiners to start quickly to expedite work.

However, if anything goes wrong later, HR is blamed rather than the HODs. There have been cases where such joiners turned out to be spies from competitor companies, aiming to smuggle trade secrets, business strategies, and other confidential information to their parent companies.

I request all the members to provide their valuable advice on how to prevent the above problem.

Regards,
Harsha.

I truly agree with the fact that there are firms which take in candidates without any kind of relieving documents, and this generally happens when people are forced to join without serving full notice to their existent employers. Being in the HR department of an IT firm, I have faced this a number of times.

I have also noticed that employees who leave without any documents get in touch with us after a couple of years and request their documents because they are asked for letters and documents by their employers. Even the kind of reference checks some companies do is very good, as they not only contact the ex-employers but also previous employers.

At the same time, I would like to mention that big names in the market don't appreciate this. If you want your people to be ethical and follow policies, you should refrain from hiring people without proper documents, as the initial interaction with the employees shows them that the company procedures have loopholes.

Guess I made sense... 😊