Employee Left Job Early: Can He Avoid Paying a Huge Notice Period Fee?

This is an absconding case where the employee worked for 1.5 months and left the company. As per the offer letter, he has to pay 3 months' gross salary as notice period dues to the company (which he is not aware of as he has not read the offer letter fully). After 6 months, the company sends him an email stating that he has to clear his dues, which is a substantial amount. Is there any way the employee can save himself from this mess (the only thing from his end is that he is still not working anywhere)?

Should he agree with the company and pay them what they ask for? Please give suggestions from the employee's point of view.

Thanks

Kindly ask him to check what the probation period mentioned in his offer letter is. Also, have him verify if the notice period recovery is after the probation period or not. If there is no notice period before probation, then he need not worry about it as he is not a confirmed employee of the company; hence, the notice period recovery would not be applicable to him.

In case there is no probation period mentioned in the letter, I suggest he should come down and explain the reasons for absconding from the services and mutually determine the best course of action.

Regards,
Ram

Thanks for the response. Here is what the offer letter says:

Prohibition Period

The prohibition period is for six months.

Termination Notice

During the period of your association with the Company, by giving written notice of 90 days, your prohibition/services may be terminated. However, at any point in time, if any of the terms and conditions are found to be violated or due to business demands, your services may be terminated with immediate effect. Instead of the notice, the Company may pay your three months' net salary. You may, with a written notice of 90 days, terminate your services with the Company or pay your three months' gross salary, at the discretion of the Company.

So the best option our friend can choose is to go and talk to them... can't challenge anything from his end, right?

Yes, dear. Maybe something can work out after a polite discussion with management. Anyway, wish him good luck from my side.

Regards,
Ram

Understanding Notice Pay Under the Industrial Disputes Act

I would like to add one thing: if the person (employee) is coming under the definition of a workman as per the Industrial Disputes Act, they need not pay any notice pay, even if they are a confirmed employee or if their appointment order states that they should pay notice pay. This is because there is nothing in the ID Act that requires a workman to serve notice or pay notice pay.

However, if the employer is terminating the employee's service, the employer must provide one month's notice (three months in the case of companies employing 100 or more employees) or pay salary in lieu of such notice. The appointment order is a contract accepted by the employee, but it will be void if it contains a clause contrary to the law. Even the certified Standing Orders of the company will not stand.

It is important to understand that the ID Act and other labor laws are designed to protect employees' interests. Therefore, if an employer issues a notice of recovery, it may not be enforced.

Regards,
Madhu.T.K

Thank you, Ram. I shared the response with our friend. He will go to HR sometime next week. Let's hope he can get out of this mess without too many problems.

Hi Madhu, our friend has worked with an IT company in the Support process. I will check if the ID Act applies to him. Thank you.

Hi Seniors, the same situation occurred with me as well. I had been employed by GREYCELLS 18 Media Ltd at 426, First Floor, Opposite metro pillar no - 132, Red Coral Building, MG Road, Ghitorni, Delhi, on 25th May 2011. I resigned from the post of MGR-Administration in November 2011. My last working day with the company was 2nd December 2011, and the company provided me with a duplicate copy of the clearance certificate, counter-signed by the CEO (Mr. Sunil Khanna) and HR Officer (Mrs. Sheela Anil) with the company stamp.

I didn't receive any confirmation letter from the company as I resigned during my probation period.

Now, when I asked GREYCELLS 18 Media Ltd to settle my full and final dues, they offered me an amount of Rs. 7,737 to accept, whereas the actual amount due was approximately Rs. 45,000. They stated that the rest of the amount was deducted against the notice period.

I served a notice period of 15 days with the company as I was on probation, and now the company is asking me to serve a notice period of 3 months. I believe this requirement is not applicable during the probation period, and no company can go beyond government policies.

Please suggest if I can approach the labor court to claim the balance amount from the company.

Understanding Employment Protection Under the ID Act

For a Manager, no protection under the ID Act is available, and such an employee is guided purely by the contract of employment (appointment order) only. Therefore, if the order suggests that one should give three months' notice, then he is supposed to give it.

The protection that I have stated is available to all persons who are not employed in a supervisory or managerial capacity. An employee working in an IT firm will also get the protection provided he is not having supervisory or managerial rights like the right of supervising the work, the right of sanctioning leave, the right of appraising the performance of subordinates, and the right of initiating disciplinary action against subordinates. Simply, it is not mere designation but any of the above-stated rights that define a manager or supervisory employee.

Regards,
Madhu.T.K

Hi all,

I have a query related to my friend working in an MNC. He worked for less than 1 year. He didn't go to work for 3 months but received his salary, and now the company has initiated a system exit for him. However, they are asking him to pay back the 3 months' salary he received. During that period, he didn't receive any emails or calls from the company.

Please guide on what he should do. Does he need to pay back the salary, or can he ask the company to rehire him for the 3 months?

Please suggest.

Liability to Repay Salary

Morally, he is liable to pay back the salary received for the days (3 months) he was absent. It was by mistake that the company paid it. Therefore, he should repay the amount and get relieved. Since he has played a foul game, the company has no obligation to recruit him back.

Since he worked for less than a year and perhaps was not confirmed in service, there is no question of notice or mail asking him to resume duty. After all, it is a case of absconding and collecting money fraudulently. How can he ask the company to recruit him back? There is no scope. He has cheated the company by receiving a salary without attending to duty. Being a good employee, he should have refunded it when he received the first salary itself.

Regards, Madhu.T.K

Hi Madhu,

Thanks for the reply, but what if he can't? Can the company take any legal action against him? Because he is not working anywhere currently due to his dad's accident.

Any helpful suggestions from an employee's point of view?

Legal Action and Employee Obligations

Whether the company can take legal action or not is not the question. The question is whether an employee or any person can take ownership of wealth to which they have no right. If the company cannot take legal action, can the employee take it? Now, if the company has not paid the dues payable to an employee (i.e., just the opposite of what has happened), what will be the reaction of the employee? They will sue the employer and collect it anyhow. Similarly, the company can also recover it. Whether he is working elsewhere or not is immaterial, but he should give the money back.

Regards, Madhu.T.K