How to Legally Terminate an Employee for Misconduct and Absenteeism? Need Advice!

I need to terminate an employee on the basis of misconduct and absenteeism from work without informing or prior approval. As per the appointment letter, we are entitled to give him 1 month's salary if we terminate him. He is asking for 3 months’ salary. What is the right and legal way to go about this? Please help!

With this post, it is understood that you've already given him written notice to join the duty. Even after doing so, he hasn't reverted or joined the duties. You can settle his account as per the clause mentioned in the appointment letter. Suggest waiting for other members to comment on the legal aspects.

Advisable Actions

In such a case, it is advisable that you ask him to put up a resignation instead of terminating. Termination on such grounds can invite legal proceedings against the company. Alternatively, you can mention in writing that if he/she doesn't join by a certain date, it is presumed that he/she is not interested in continuing the job.

Please provide your query in detail:

1. Whether the employee is under probation or confirmed.
2. Whether any warning letter on misconduct or absenteeism has been issued.
3. What was the response?
4. Is this the first instance, or does it happen frequently?
5. What is the code of conduct policy in your company?
6. Was the misconduct severe?

Please share the exact details with the forum so we can provide appropriate advice.

Regards

Yes, he was informed of his absenteeism, and he didn't resume work after that. We have also told him to rejoin by a specific date, failing which would result in termination. He is requesting us to pay him 3 months' salary instead of the one month mentioned in his letter.

Thanks!

Regards,
Simi

To answer your queries:

1. He is a confirmed employee.
2. He hasn't performed as per his targets, and when confronted, he gets very abusive with his manager.
3. Warning letters have been issued, and he was asked to leave if he didn't join back by a specified date.
4. The code of conduct policy states that if a person remains absent without notifying his supervisor or without prior approvals, his employment can be terminated as absconding.
5. Misconduct has been regular, if not severe.

Regards,
Simi

Looking at the points mentioned, he can be terminated as per the termination clause outlined in the appointment letter. If the notice period is one month, simply provide him with one month's salary as a full and final settlement. Ensure all formalities are completed beforehand.

If the appointment letter states one month's pay in lieu of termination, you can indeed adhere to that. However, before doing so, please ensure that you have a copy of the letter duly signed by the employee (on every page if the appointment letter exceeds one page).

Have you ever issued him a warning letter in this regard? If not, you must do that without wasting time.

Terms in Appointment Letters

In addition, what terms are you using in appointment letters regarding this matter? Is it that if any employee is found with any misconduct or violates the policies and conditions of employment, they cannot be terminated before being offered a one-month notice period or salary as compensation? I am sure nothing like this was stated in the appointment letter or your policies concerning this matter.

First, you must review the copy of the appointment letter that was issued to him, utilize the terms, and issue him a warning letter clearly stating the reason. If he still does not respond, proceed to issue a termination letter without delay. Your policies cover all the necessary actions that need to be taken. Therefore, I, like the members above, suggest that any employee displaying such misconduct and attitude should not be allowed to remain. You must handle this situation in a professional manner.

Although the reason for termination has already been communicated by you and he has acknowledged it, there is no need to go through a step-by-step analysis of the documentation supporting the reason for discharge.

Due care and procedure should be adhered to while terminating an employee. Any shortcomings might lead to litigation and payment of heavy compensation. It is very much necessary that a Domestic Inquiry should be complied with in this case also. Generally, a first-time absentee doesn't warrant dismissal. However, this becomes grave when they become a "habitual absentee," in which case it may be fitting to go for dismissal/termination. Therefore, all procedural compliance should be taken care of during the inquiry. This is an adequate precaution only to avoid repercussions when the absentee comes back with a 'medical certificate' pleading not guilty. There are many instances where an absent employee goes overseas, works there, and after months/years, comes back with a medical certificate and gets reinstated.

Better verify your Standing Order whether clauses are clear or not. Even if there are none, you should opt for a Domestic Inquiry, suspension, etc., route instead of a fast track/shortcut notice and termination.

The question of one/two months' salary in lieu of the notice period would arise only when the Domestic Inquiry finds him guilty of charges framed and so on. If the terms and conditions specify one month's notice or two months' notice, proceed accordingly.

Regards,
Kumar.s.

Clarifying Employment Terms and Termination Procedures

When a staff member is going to sign an offer letter, HR is responsible for knowing the exact or tentative date of joining. They should not assume the employee is already in the working environment. The word "termination" that you are considering using may have different implications from "dismissal." Therefore, it is essential to clarify the terms and conditions.

A staff member can face termination from the moment they join work, and based on the organization's policy, they will be evaluated. Consequently, there may not be a need to provide them with a one-month salary if termination occurs. Instead, communicate that they were expected to join the organization on [insert date] based on their confirmation. Apologize for their inability to join and offer the opportunity to the second choice for the position.

Please let me know if you have any questions.

Regards,

If the concerned employee qualifies as a workman under the Industrial Disputes Act, 1947, then you should consider the very real possibility that he may challenge the termination order if you decide to summarily terminate his services, and you may find yourself on a weak footing.

If he belongs to the supervisory category, then you may terminate him as per the terms of his appointment letter after giving him due notice. However, you could have a one-on-one chat with him to apprise him of jeopardizing his future career prospects in case he carries the stigma of termination and persuade him to submit his resignation, dealing with his exit accordingly.

Best Wishes,
Vasant Nair
[Phone Number Removed For Privacy Reasons]

Steps to Handle Employee Absenteeism

Firstly, try to make him understand in a polite manner. If he is not ready to understand the facts, then just follow the steps below:

1. First, send him the absenting letter by registered post, asking for a report within 48 hours of receiving the same (as per Attachment 1).

2. If he reports back, then do not go for termination. Ask him to continue, or if he does not continue, just ask him to resign so that his full and final settlement can be prepared.

3. If he continues, then just make him sit idle and avoid giving him any assignments.

4. If he does not continue, he will have to resign, or he will be categorized as an absconding employee. In that case, the company will not be liable to pay him the notice period as he will resign on his own or will be absconding.

5. If he does not come back or respond after the first absenting letter, then send him the second and last absenting letter (as per Attachment 2).

6. Again, if he does not respond, just mark him as left in your records, and that's it.

7. In the future, if he goes for arbitration, then the company may show the absenting letters sent to him and can defend by showing him as absconding. Additionally, we can add any charges or debits against him.

8. If he responds back after the second letter, then follow the steps as per points 2, 3, and 4.

No need to worry—always avoid termination. We have too many options to deal with these situations other than termination.

It is nice that all the colleagues have given valuable suggestions on the issue. But I would like to suggest that terminating any employee is a major punishment for which all the actions of the management are subject to legal scrutiny. Therefore, much care has to be taken while terminating any employee.

Steps to Follow Before Termination

I suggest that before initiating action for termination, it is better to serve a show cause notice on the employee concerned (irrespective of the terms of reference in the offer of employment, to meet the ends of natural justice), duly mentioning the imputations of his misconduct in detail and ask for his explanation as to why he should not be terminated, giving a reasonable time to offer his explanation.

After the receipt of the explanation, the competent authority has to examine the explanation in greater detail, and if necessary, after conducting a detailed inquiry on the allegations, final action has to be taken for terminating the employee with valid reasons together with material evidence to prove the imputations of misconduct against the employee, to avoid legal complications.

Though the process is time-consuming, it is necessary to follow the same to meet the ends of natural justice. Otherwise, the issue will become a problem before a competent court of law.

Regards,
Suri Babu Komakula

Views as expressed by Mr. Kumar S. hold good. In today's context, no employer can discharge or dismiss a delinquent workman, even for serious misconduct, without following an elaborate procedure for taking disciplinary action. It is only when the workman is found guilty of the charges in an inquiry conducted as per the principle of natural justice that the employer, after following the procedure, can punish him as per the company's standing orders. The principle of natural justice clearly states that (a) No man shall be the judge in his own cause, (b) Both sides shall be heard. Hence, you should give the delinquent workman the opportunity to be heard and conduct a fair and proper inquiry.

Ok, this was all about legal aspects, which are always subject to being challenged in the court of law. In fact, you have a very good case where the workman is willing to tender his resignation letter. Please take his resignation letter written in his handwriting with the date clearly mentioned (no typed text, please), accept his resignation, take NOC from all relevant departments, and pay him all his legally payable dues. In my opinion, management should not mind paying him three months' salary if you avoid the possibility of future litigation. For this, you may ask him to request the management in writing for paying him three months' notice as a gesture of good management.

Regards,
Rakesh Pd Srivastav

I agree with Mr. Kumar. Please conduct a domestic inquiry based on the charge sheet issued by you. Terminating based on the findings of the domestic inquiry will save your organization from legal issues and serve as a lesson to other employees.

The misconduct alleged to have been committed by the employee has come on record. On this count, it is a risky proposition to terminate the employee by paying salary in lieu of the notice period. You may end up paying heavy compensation if it is challenged in a court of law. Once misconduct appears on record, it is better to follow the procedure of a domestic inquiry. If the charge is proved in the inquiry, the employee can be dismissed as per standing orders. Anyway, the question of paying salary in lieu of notice does not arise once the domestic inquiry is in place.

Regards,
Prakash

It is safe if you talk to him and assure 3 months' pay if he resigns. If he agrees, then take a resignation letter from the employee. The resignation letter should be simple and briefly worded. No reason should be cited for the resignation. The resignation letter should contain a request to release the employee "immediately" or "as early as possible." Immediately upon receiving such a resignation letter, you should release him the same day. Along with the release letter, you must give him his full and final settlement money, which must include 3 months' salary.

In case he does not agree to resign and wants to get terminated, then pay only 1 month's salary as compensation as per the appointment letter and terminate him. After his termination, if he creates any problems, then why should you pay him more than 1 month?

Regards,
T. Chandran

This gentleman in question has gone ahead and joined another company without obtaining clearance from our side. He has been absconding since October 22nd and was aggressively asking for three months' pay and a termination letter. Can you please advise on the best way to handle this now that we know he has joined another company?

Regards

Dear Simihanspal,

My views dated 20.11.12 hold good even now. As it is clear, you have to conclude his case by adopting necessary procedures, instituting a formal inquiry, etc., and close his file, terminating his service ultimately without any terminal benefits (forfeiting). As an extraordinary measure, you may also lodge an FIR with the local police for "absconding" and loss of company properties and inform/notify the action taken, ensuring proper acknowledgment of communication to his last known address and his immediate family members. There is nothing wrong with giving an advertisement for "Missing" in local dailies as well, with or without his photos. I think there is no question of 3 months' pay as he is still "absconding." Incidentally, how is he "asking for 3 months' pay"? Any contacts?

Steps to Terminate Employment

First step - notice to appear at the office within a week, second - show-cause notice, also suspension pending inquiry (ensure subsistence allowance to his bank account), third - 2nd show-cause notice, third - charge sheeting him and publication in dailies, fourth - personal hearing, fifth - findings, sixth - dismissal. It is a slow process; don't mind it. Mate, how many years of service had he put in your firm? Was he a permanent employee? Was he indispensable in your department?

Regards,
Kumar.S.

Well Simi, the game has now assumed a different dimension. The guy, it seems, is working in tandem with a legal expert and wants to use a termination letter to his advantage by laying claim before the authorities for reinstatement as well as three months' notice pay. Since your record says he has been absconding since 22nd October, I suggest you must issue him a letter at once asking him to resume his duties immediately. If he doesn't reply (which he will not), start the process of conducting a Domestic Enquiry.

Considering the scenario, all charges leveled against him (absenting unauthorizedly since 22.10.2012 without intimation, misbehavior with colleagues/superiors, double employment (since he is still on the rolls of your organization and your employee, he cannot join another company), etc.) will be easily proved in the inquiry. In all possibility, he may not attend the inquiry proceedings at all, and the inquiry may be conducted ex-parte. Once you get the Enquiry Report, issue him a termination letter along with all legal dues payable to him.

Please rope in a good labor law advocate who knows how to conduct a domestic inquiry. Your guy appears to be a bit smart; get rid of him asap and in a thorough and proper manner. Concurrently, you can also write a letter to the HR Manager of his current company and explain in detail about his nature, behavior, and incidents of misconduct which he did in your company. I am sure, once he lands in trouble in his current company, he will rush begging to you for unconditional settlement. (kabhi kabhi ungali tedhi harni hi padti hai!)

All the best!

Regards,
Rakesh Pd Srivastav

Procedure for Employee Termination Due to Misconduct

If you want to terminate an employee, whether temporarily or permanently, on the basis of misconduct and unauthorized absence, you must follow the proper procedure to avoid further legal complications. Initially, you must conduct a domestic inquiry by appointing an Inquiry Officer to investigate the allegations of misconduct.

Upon receiving the Inquiry Report, if the misconduct allegations against the employee are proven beyond doubt, you must issue a final show cause notice to the employee, providing them with an opportunity to present their explanation within one week. After receiving the explanation, you should thoroughly review it, and if deemed unsatisfactory, you can proceed with issuing termination orders to the employee. This approach ensures adherence to the principles of natural justice; otherwise, it may lead to legal issues.

If the misconduct allegations against the employee are not substantiated during the inquiry, terminating the employee would not be feasible as it would violate legal provisions.

Therefore, it is crucial to handle such cases with care, as employee termination constitutes a significant disciplinary action.

Regards,
Suri Babu Komakula

Understanding Show Cause Notices and Termination Procedures

It is only if the Standing Orders of the company provide for a Show Cause Notice to be issued to the employee before inflicting the decided punishment upon him that one needs to do so. What you perhaps mean to convey is that once the management is sure about the kind of punishment they have decided to inflict upon the charge-sheeted employee (found guilty by the EO), a Show Cause Notice is issued to the employee asking him to explain why the said punishment should not be inflicted upon him. In the said Show Cause, the past record is also to be taken into consideration to see if there are any extenuating or precipitating circumstances to either take a lenient view or otherwise against the employee.

Best Wishes, Vasant Nair

Steps to Terminate an Employee for Misconduct or Unauthorized Absence

Dear friend, if you want to terminate an employee, either temporarily or permanently, on the basis of misconduct and unauthorized absence, you have to follow the due procedure to avoid further legal complications. In the first instance, you have to conduct a domestic inquiry by appointing an Inquiry Officer to conduct an inquiry into the imputations of misconduct. After the receipt of the Inquiry Report, and if the imputations of misconduct against the employee are proved beyond doubt, you have to issue a final Show Cause Notice to the employee, giving him an opportunity to put forth his explanation within one week or so. After the receipt of the explanation, you have to examine the explanation of the employee in greater detail, and if the explanation is not satisfactory, you can issue termination orders to the employee. This initiative will meet the ends of natural justice. Otherwise, it will be a legal problem for you.

In case the imputations of misconduct against the employee are not proved in the inquiry, it is not possible to terminate the employee as it will attract the legal provisions. So, it is highly essential that due care has to be taken in such cases, as the termination of the employee comes under major punishment.

Regards,
Suri Babu Komakula

I forgot one thing, now the picture is very clear. If it is reliably learned that he has joined the other company and you could acquire some sort of proof of it, nothing else is necessary. This itself is evidence of his illegal activity. Straight away file a charge sheet in the domestic inquiry "Order sheet," appoint an inquiry officer as per your S.O., record all the efforts you have taken to trace him and finally his joining the other company, and his demand for 3 months' notice pay as a threat (orally or via SMS or through what?). Go for dismissal and not termination, forfeiting all benefits except PF, as termination would convey a different meaning.

Also, simultaneously file the FIR under Cr.PC (not under CPC) with the police stating that he has not handed over and has vanished, etc., as an extra support. Close his file for the present, of course.

Regards,
Kumar S.

Firstly, consider the sections of your Standing Orders containing the actions to be taken in case of regular absenteeism and misconduct. If you want to get rid of this employee, you can transfer him to any of your branches where he cannot approach. You can also give him a show cause notice about the reasons for his absenteeism and misconduct.

If the concerned employee is a probationer, then you can terminate his service without any notice.

Regards,
Soniya Bhardwaj
HR Professional

Sir, if management includes a clause in the appointment letter for settlement of accounts for self-termination due to absence for 10 consecutive days, what should an employee do?

The employee did not report for duty after being transferred to a city in the northeast of India where the PSU does not have any establishment or office, and working from home was suggested.

Please provide guidance as soon as possible.