Can We Legally Include a Termination Clause for Sales Targets in Appointment Letters?

Dear all Senior,

I would like to seek your advice on whether an appointment letter can include a termination clause. For example, my retail head is considering including a clause stating that if any sales staff fails to achieve the sales target for three consecutive months, they will be terminated.

I am unsure whether it is sensible or legal to mention this in the appointment letter.

Regards,
Anee

You can incorporate such a clause in the appointment letter. Please also ensure that such a clause is not in conflict with any similar clause incorporated in your company's standing orders, if any, in which case the latter will prevail. Furthermore, the language of the clause shall not be punitive in nature.

Regards,
B. Saikumar
HR & Labour Law Advisor
Mumbai
[Phone Number Removed For Privacy Reasons].

Can we include this clause in the promotion letter: "If your performance is not found to be appropriate, the promotion will be revoked." The intention is to ensure that the promoted employee continues to perform well. Please guide.

Regards,
Anee