Can We Legally Terminate and Deduct Salary from an Employee Who Resigned Abruptly?

Dear Members,

I have a unique problem. One of my organization's employees was not performing for quite some time; he was on probation. He was given several verbal warnings on absenteeism, non-performance, late arrivals, etc. Unfortunately, none were recorded as there was no HR in the company. After I came in, I issued him a warning letter stating an observation period of 15 days, after which management can take a stand. The next day, he did not report to work citing health reasons, and when he reported to the office, he said that he wanted to resign, stating health reasons. He resigned, citing unavoidable circumstances, and it was duly accepted by the management provided he served a 15-day notice period or pay in lieu thereof.

However, on the same day, when his handover process had just started, and he was being questioned and reviewed about his work by the management, he suddenly threw a tantrum in front of the office, stating that he did not feel like being in the company and he wanted to leave right then.

I informed him that in that case, his resignation is no longer accepted, and since he is not serving the notice period, his 15 days' salary will be deducted.

In his appointment letter, it was mentioned that "15 days notice period or pay in lieu of from both ends," and "in case of insubordination or indiscipline termination without notice from the management's end."

Legal Feasibility of Termination and Salary Deduction

Now the question is - my management and I do not want to issue any relieving or experience letter. In fact, they would prefer a termination letter to be issued and 15 days' worth of salary to be deducted. Can this be feasible from a legal point of view?

Please suggest.

Regards.

Understanding the Implications of Issuing a Termination Letter

Why do you want to issue a termination letter? Is it to satisfy your management team's ego? Why are you finding it difficult to accept the fact that an employee is within their right not to work in an organization because they do not like its work culture?

By terminating him, you will be making a mockery of yourself as he has already resigned. Please don't make it an ego issue and let it go.

I have gone through your complete case, but I feel that you and your management are handling the situation in an egotistical manner. If there is a person whom you do not like and who is not performing, and he has resigned himself, then let him go. What will you gain by terminating him? The clause you have mentioned in your appointment letter is void ab initio, which means it is illegal.

Whatever tactics you are planning to adopt are not a healthy sign. An individual can go to the labor office and create problems for you. Let him go peacefully, and you also stay peacefully.

As Kaushik and Malik suggested, it is nothing but a waste of time for your management and you to keep such an uninterested person in the organization. Simply accept his resignation and settle with him.

Even though I was dubious about issuing a termination since that employee has already resigned, I have this query: am I liable to provide a release letter, even though that person shouted and created a scene in the office when it was found out that there were a lot of discrepancies in his work, and he was being asked to provide an explanation for the same to complete the handover process? This was when we had decided that we would accept his resignation, and he would be provided the release.

After openly insulting the senior management and walking out, even though that person had been given a lot of chances before and even after his resignation, he was told that the management would end it on good terms. Isn't a message being given to other employees that an employee cannot perform, be undisciplined, and even insult the management and still get away scot-free?

I am thinking that "the person can be informed that his resignation is not accepted, and since he has refused to serve the notice period, his 15 days' salary will be deducted, and he will be provided salary as well as his Form 16, though no release will be provided." Can this be feasible?

Regards.

I have finally made a decision and asked that person to resign, mentioning that he was unwilling to serve the notice period. Initially, he had stated that he would, and now I am going to accept his resignation. He has been notified that 15 days' notice period will be deducted since he has refused to serve it. He will receive the check, and the Full and Final settlement will be processed from our end. After this, I have informed him that a release letter will be provided along with Form 16.

I have requested him to apologize to the senior management; however, it has been made clear that this is optional. If he chooses not to apologize, we will proceed with the discussed procedure nonetheless.

I believe this is the most practical approach to ensure that management takes a firm stand and that the individual is handled appropriately.

Any comments on the decision I have made?

Release Letter Content

P.S.: In the person's release letter, should it be kept concise, or do I need to mention something about his performance and conduct in the organization? I prefer not to include any such details.

Regards.

In your initial post, you have stated that the concerned employee had resigned and that his resignation has been accepted provided he serves out the prescribed 15 days' Notice Period. You have also mentioned that the concerned employee later threw a tantrum and wanted to leave immediately. Now you are adding a new dimension to the matter, stating that you will ask him to resign, etc.

Please understand that an employee will only resign once, and it is up to the management to deal with the situation thereafter. It should also not be forgotten that the employee cannot be forced to serve out the Notice Period. It is his right to decide otherwise and surrender salary in lieu of the shortfall in the Notice Period. Please be sure about the facts of the matter and then decide upon your course of action.

Try not to flex your muscles in forcing the employee to apologize, etc., in his new resignation letter. It lends a distasteful flavor to handling/managing people. Vasant Nair

I agree with the posts. If the employee has already resigned, he does not want to work for you. If he doesn't want to serve his notice, you can recover it from his salary. However, terminating him on notice is amusing; it only reinforces the status of the poor relationship! But you may want to do that on your own account. If you terminate his notice, you are liable to pay for the rest of the duration. However, if you are facing losses due to his conduct (such as loss of sales, loss of customer image, etc.), then you might still want to proceed.

Further, including it in the certificate would create a difficult situation for the employee to handle in the future. It may not be worth it!

Thank you, everyone, for your valuable comments. I guess the entire picture is not clear since there are a lot of facts that I have not mentioned. This problem has been occurring for a long time, and I have recently joined and faced this situation. I ensured that both sides were taken care of, management and the employee.

Employee Resignation and Subsequent Issues

First of all, the employee hasn't been terminated, as he has resigned. Though in his resignation letter, he mentioned a lot of things, including that he will serve the notice period, and he had mentioned to us that he was mentally unfit to work. We were fine with it because he was not performing well and was absenting from duty regularly. We accepted the resignation, and the handover process started on that day itself. When his work was being reviewed by his reporting head, it was revealed that there were many discrepancies, and the information was fraudulent. Upon being questioned, he started shouting and insulting the head, stormed out of the cabin, went to the floors, and started creating a huge scene.

Management's Response and Resolution

After this, the management was not fine with handing over the release and payment, and they wanted me to find a solution. I understand that if an employee has resigned once, he shouldn't do it again, but in this case, to salvage a lot of egos, I went ahead and spoke to him one-on-one. I told him to resign, mentioning that he is unwilling to serve the notice period, and we will accept it and give his payment and release. He has agreed. The apology thing is just a preference, no hard and fast rule.

I felt this was the only way I could ensure that even the employee is not taken for a ride, and neither is the management.

Seeking Guidance and Feedback

Since I have never faced such a situation before and have been in the HR industry for just over a year, I went viral on CiteHR since I do not have a manager to fall back on. So thank you for all your feedback, it actually helped me make a decision.

Regards.

Handling Employee Termination: A Thoughtful Approach

Now the decision has already been taken, so stay calm. However, I would like to say that if, in the future, you encounter a similar situation, kindly don't even think of terminating an employee immediately. HR is all about dealing with and understanding employees. Try to observe and understand the behavior of the employee, and then work to sort out their concerns. Termination is a very harsh act and should only be considered when no other option is available.

Even though the story has come to an end, I would like to share my views, of course, for the future.

Resignation Process

If an employee has to resign, he must provide his resignation letter in writing, duly mentioning the reason and giving a notice period as stated in the offer letter. Otherwise, it is not valid. Simply giving an oral communication is not accepted. The management has the right to accept the letter.

Handling Poor Performance

In the case of poor performance or any other matter, you should have addressed it with him before he submits his resignation; otherwise, it will be assumed that the company wants to antagonize him. In the absence of such a letter asking him to explain the reasons, you cannot make him understand that his performance is poor, etc. Once he submits his resignation before you ask him about the poor performance or discipline, it's better to accept it as per his offer letter terms and relieve him. The management has the right to waive off the notice period in case the employee is very loyal and resigning due to some personal reasons, etc.

Termination and Benefits

You may be aware that if the company terminates him from the services, he may not get his PF or Gratuity settled.

1. Whatever the problems, don't forget how your negative decision will affect the other good employees' impression of the company. If he requests to resign, you should accept the resignation and follow your country's labor law (deduction of notice period or whatever). That is all.

2. Certificate: You can't refuse to provide a work certificate to your employee or use negative expressions in its content. Refer to the ILO Convention for better understanding.

3. Finally, ensure that the HR Department has conducted the exit interview properly.

Termination Letter Format Request

Please provide me with a format for a termination letter for issuing emails regarding a good performer who, after their resignation, is:

1. Not reporting to work/Absenteeism at work.
2. Not serving the notice period/Handover incomplete.

Thanks and Regards

Handling Termination with Caution

Termination is a very risky word that must be handled with care by management, as it's the last resort and invites problems from a legal perspective. An employee who is a non-performer, after many verbal cautions and one written warning, has finally resigned. In this case, the management should accept the resignation with the conditions applicable as per the terms of employment. Therefore, there is no reason for a termination letter to be issued for not serving the notice period, as the other clause, i.e., deduction of salary in lieu of notice, should be made applicable.

Regards,
B.K. Mohanty
Advisor HR

Management's Approach to Employee Termination

The very basic thing is, why would the management expose itself in writing to submit a resignation letter indicating that they want to terminate the employee, which in the court of law might go against the management?

The very first thing is that if an employee is not performing as per the requirements, then the management should specify and communicate in writing to the concerned employee and retain these letter copies as records for future references. Secondly, once the management finds no improvement still, they should write a letter to the employee stating that on previous occasions, the employee was cautioned to improve but has neither improved nor communicated/replied mentioning their inability to do so. Hence, under the specified terms and conditions and rules applicable to that company, "their services are no longer required." The employee may be asked in the same letter to collect their full and final settlements on any working day after submitting a "no dues certificate."

Regards,

B.K. Mohanty

Director

Cypress Management Associates

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