How Can HR Ensure Employees Respect the One-Month Notice Period? Seeking Advice

Hello fellow members, I wanted to direct this question to HR Managers in particular. At times, employees, when they resign, come to you and say, "I don't want to serve the notice period as a policy" and are not willing to give one month's salary in lieu.

Enforcing a One-Month Notice Period

1. What should be the appropriate way to enforce a one-month notice period to employees and ensure that whoever resigns next serves the notice period?

2. To what extent should a company go to make sure the employee follows it?

3. Should management and leads be involved?

4. What should be HR responsibilities in this case?

5. Suggest the best policy and procedure to ensure everyone serves it.

Thanks

For those who are unwilling to pay the salary in lieu of the notice period, you can withhold their relieving letter until the receipt of dues from employees. For the ones who are ready to pay off the notice period, you have to issue the service certificate. The best way to make this clause deterrent is to make employees aware of the notice period clause. Lay down the detailed handover/KT procedure. Verbally refuse to relieve them prior to the completion of the notice period. Still, if they do not want to wait, you can add a comment in their relieving letter to that effect, for example - "You have not served the notice period, and it is unprofessional behavior. However, as per the terms of employment, we are relieving you," etc.

Following such strict measures will slowly bring in awareness and discipline.

Regards,
Nilesh

Notice Period Clause in Appointment Letters

You should specifically mention a clause regarding the notice period in the appointment letter. At the time of induction, you should communicate this once again and make it mandatory for the HODs to also communicate this information to the employees.

As far as I am concerned, if you have an alternative method to relieve the resigned employee earlier, especially if they are willing to buy out the remaining notice period, it would be beneficial. Once an employee submits their resignation, their attitude and interest towards the organization may change, potentially leading to non-performance. Other employees within the system may also be influenced or disturbed by the outgoing employee.

Employees who are not willing to serve out their notice period or buy it out should not be provided with the final settlement amount, relieving letter, no-due certificate, and service certificate. Additionally, it is advisable to send a notice to the employee and the prospective employer stating that the employee has not completed handing over formalities, and legal action may be pursued. This action will inform other employees and ensure compliance with formalities.

Regards,
Kamesh

You have raised a fundamental question.

The Employer-Employee Relationship

The employer-employee relationship is governed by the contract of employment (also known as the Letter of Appointment containing Terms and Conditions of employment). Subject to the provisions of this contract, it is clear that contractual commitments have to be performed by each party. The notice period clause was not inserted for fun! While the management has a right to waive certain conditionalities, this discretion should never be used indiscriminately to make a mockery of the same. Therefore, exceptional cases apart, the company may consider the following options to underscore the seriousness of such a clause:

1. Obtain a security deposit while recruiting itself or gradually recover such an amount from the employee's salary over the first few months with their consent. This amount will be recovered if the employee does not honor the notice period obligations and will be refunded with the full and final settlement of their employment dues if they do honor the commitment.

2. Block their settlement of dues, barring the statutory ones like PF, Gratuity, etc.

3. Refuse to issue a service certificate and/or resignation acceptance letter.

4. Inform the future employer about the unprofessional conduct of such an employee.

5. Prosecute the employee in a civil court for a breach of settlement.

Considerations for Enforcement

More alternative ways can be thought of, but one has to remember that any chosen approach will be dependent on:

1. Company culture and adopted HR philosophy.

2. The impact such an action would have on future employees and the company's image in the employment market, as well as on the existing employee morale.

3. Being morally right and also legally right at the same time could be very tricky, but one may have to make a decision in the long-term interest of the organization.

I am NOT recommending any of these. The choice has to be made by the employer in each case. If I am asked to select an approach, my choice will depend on the facts and circumstances of the given case.

You are welcome to generate more arguments on the subject. If you need further clarifications, please share your responses.

Regards,
Samvedan

December 20, 2011

Thank you Samvedan, kamesh333, and nileshsawant2011. What if an employee comes to you stating that they have a certain number of remaining leave days and can leave without serving them? How would you ensure that the employee does not misuse this by frequently taking one or two days off to use up their leave balance? I believe such situations are significant concerns for employers, and I am certain that many of us have encountered this issue.

Thanks

Leave as a Privilege, Not a Right

Remember, leave is a privilege and not a right. For leave to be an authorized absence, it must have pre-sanction. In exceptional cases, a post-facto sanction may turn unauthorized absence into an authorized absence.

Using Leave for Notice Period Adjustment

If an employee has some leave to their credit and wishes to use it for an adjustment of the notice period, the employer may, using discretionary power, agree and relieve the employee earlier. However, the employer is not obliged under any law to do so.

Handling Misuse of Leave

If you suspect an employee is misusing their balance leave, you have every right to refuse to sanction it. This means they lose salary for such days, must complete the entire notice period, and may suffer in credibility and dignity. However, this cannot prevent them from misbehaving, especially if they are already in a mindset where they do not care what the employer may think of them. You may have to choose one of the ways suggested in my earlier post.

Further questions, if any, are welcome!

Regards,
Samvedan

December 21, 2011

I am working as an HR in a small company where I have encountered similar kinds of problems. We have an open-door policy where an employee can be relieved immediately. However, it's mentioned in the appointment letter that if an employee is on a probation period, i.e., 1 year, and resigns from the company, then he/she has to serve a 1-month notice period, or else their basic will be deducted in full and final as per the appointment letter. But nobody was following such policies because previously the policies were not strictly implemented. Hence, many employees were joining and leaving the company very frequently. I have analyzed that some of the employees had worked only for 15 days or 1 month.

Now, I strictly started following the clauses of the offer letter and deducted the basic amount whenever any employee was leaving the organization without serving the notice period. I was surprised to see the result in the past 3 months that there is a slight drop in employees leaving the organization. They are leaving, but at least with proper knowledge transition (KT), and we are also getting time to hire a new employee of our choice. So, it's mandatory to strictly follow the policies.

If still, some employees are leaving, then a company can stop their experience letter. As per my concern, an HR alone can handle these things. Even legal action can also be taken against an employee with prior notice.

In my opinion, you need to revise your appointment letter because an employer can change the policies of the offer letter according to their discretion after taking the signature of all employees.

I hope this will be helpful to you.

Regards,
Garima

I am desperately looking for a solution on how to make employees truly understand their sense of responsibility. We have amended many clauses in the appointment letter, but still, a few people are leaving with just a 1-day notice. Unfortunately, they do not require a release letter, acceptance letter, or experience certificate. Very recently, we had such an incident where an employee of 4 years just walked out because he received an offer almost 1.5 times higher. The worst problem is the companies that are recruiting; they are not following HR policies as per the industry.

It seems to be a social problem, impacting smaller companies like ours more significantly. Can anyone address this issue when an employee leaving does not require any final documents and submits their resignation after receiving their salary? What can be done?

Employee Resignation and Notice Period Challenges

If the leaving employee does not require any documents, there is no practical or wise way to try and stop him/her. Seeking damages for breach of contract is a civil matter and could take many years before the employer gets his pound of flesh, so to speak.

Under the conditions you describe, even if such an employee stays back to fulfill the "notice period" obligation, what use will you have for a reluctant employee, if at all? Furthermore, what guarantee is there that such an employee, during this period, will conduct himself in a dignified manner? He may end up vitiating the organizational atmosphere, which no employer would like.

My first response in this thread has a suggestion regarding collecting a "security deposit" from all new employees and confiscating the same if the employee does not fulfill his contractual obligations upon leaving employment. In suggesting this, I am aware that I am not entirely above board in matters of ethics and values. But when you have to run an economic organization, charity cannot be your guiding motive.

Kindly respond if you feel the need to ask more questions or express further opinions.

Regards,
Samvedan