Employee Separation / Termination In Australia

Respected Seniors,

What are the laws related to employee separation/termination in Australia? What happens to the leave balance of an employee if they are transferred/deputed to another country from India on a long-term work permit/visa? Could anyone provide me with some links to research on this?

Thank you.

To ascertain which law is binding, please let the forum know a few more details. For example, is the company Indian? What does the termination/separation clause state in your appointment letter? Providing these details will enable us to give you appropriate responses.

Saji,

Yes, our company is an Indian company. I was more interested in knowing what the laws are applicable if I were planning to move on to another company. What should be the notice period I should provide to my employer as per Australian law, regardless of what I have signed in my contract with my employer.

Moreover, could you also help me understand what leaves are entitled to an employee for a one-month period in Australia and how I should claim my leave balance payment.

Dear Anonymous,

Thank you for not just sharing a view but contributing with a contact that can resolve the situation. I appreciate such responsible gestures!

I support Saji,s views in this regard. You may be working, at any location, in the world. Logically, since you are employee of Indian Company, you are governed by the rules as stated in your Appointment letter, especially about Resignation, Notice period, Leave matters, etc. Other situational things, like office timings, holidays, medical assistance, travel assistance, other work related rules/laws, can be under Australian rules.

I have a strong doubts about statements made by Anonymous, especially in the matters of Resignation. If the foreign company, which is presumed to be collaborator of Indian company, has issued its own Service rules, to an Indian departed employee, then the statements of Anonymous become true. A person joined an Organisation in India, anywhere he goes in the world, for work, on deputation, he will send his resignation to his Original employer.

There are many foreigners come to India, for working in the offices of their Indian collaborators, I don’t think, if he wishes to resign, he is governed by Indian office rules. He will send his resignation to his US Office.

Anyway, these are my personal thoughts. I fully accept and appreciate, The best and only answer, given by Anonymous, “Talk directly to the HR in Australia”, for which he himself has provided references. Great job !!

You may sign a contract with an Indian company based in India, but, the moment you obtain a work permit in another country, the law of that country supersedes any contract terms that you may have signed. If you go through case histories of the cases that have been filed against TCS and Infosys and other such companies seeking compensation for exploitation by H1B employees, you will realise how it works. As an organisation, we have faced a couple of cases and have had to resort to out of court settlements since certain terms that are applicable in one country, is not relevant in other countries and we were counselled by the lawyers that the terms of transfer have to be aligned with the local laws where an employee is being placed. It cannot violate the local laws. Just a case in example, in a layman's language, " Procuring any type of guns in the US is legal and does not require a gun licence. Will that hold good in India? No. In India the guns are licenced and the types of guns allowed for public are very restricted". One needs to align with the Indian laws, even if you are a tourist. Why? Because the Indian law is supreme in India. The same applies for any country.

Sir, Your views are very informative, and also 100 percent acceptable to anyone.
The question which remained unanswered is ‘whether law in Australia is applicable to RESIGNATION’ also. To whom, the person, desirous of resigning, will submit the ‘Notice period’. To my understanding, it will be his Original Indian Employer. Then, ofcourse, the Indian HR will have a dialogue with Foreign HR, and in consultation with him, process the Resignation papers.
This is really an interesting case to study. If Indian company has issued an appointment letter stating that ONE months notice period is required, and as per Foreign company, where the person is currently working, the notice period is THREE months. As per Australian law, the person should serve three months notice. OK, fine.
Let us talk, other way. If Indian company has issued letter requiring THREE months notice, and Australian company, where he is deputed, has a rule of ONE month, or ONE WEEK… then what is the answer !!

Abhay,

I have been working as a Global HR head for the past 11 years and have worked in 3 continents and am currently overseeing HR in 44 sites in 38 countries across 5 continents.

The issue is not by the Australian company having a different notice period from the notice period of Indian company. It's about the terms of appointment aligning with Australian Law. Many times when we transfer a person to another country, we just shoot out a transfer letter stating you are transferred on the same terms and conditions and only mention the package. When the person wants to resign, we harass him to comply with Indian terms, not realizing that Indian terms are not valid in the other country. I will give you a few examples.

We have an Oil well in Venezuela. As per the terms of our appointment, the notice period is 3 months. While the Venezuelan government has a rule that if a person does not work in a strategic position and he is in a graduate/officer/manager position, then his notice period will not be more than a month. And if a person is working in a non-graduate position and is not in an executive position, then his notice period cannot be beyond 2 weeks. The settlement needs to be paid within 24 hours of relieving; if not, there is a jail term for the HR head and the CEO. (Remember, Venezuela is a Socialist country, and hence all laws are employee-friendly.) My company is headquartered in one of the ASEAN countries. We have a few Indian expats working. An Indian expat was the reporting boss of the person transferred to Venezuela. This boss started harassing him, stating that he will not relieve him and had given instructions to HR to stop all his salary till further notice with a cc to that employee. Before the Venezuelan HR team could act on the mail, the concerned employee walked into the labor office and handed over the mails to the labor officer. The labor officer and the police landed up at the doors of our office. We had a huge problem. They wanted to arrest the HR head and also the CEO. Luckily the CEO was in Mexico on tour. The HR head was detained and taken to the Police station. We then intervened and pleaded with the aggrieved employee to settle the issue by taking double the money of his settlement and withdraw the complaint. Needless to say, the labor department and the cops made their money too.

The second example of mine indicates the laws on working hours. The working hours in India are 48 hours a week, but most countries are between 40 and 45 hours. But France is different. We have an operation in France. In India, other than workers, no one is paid overtime, especially Officers. France had 39 hours a week. But in the year 2000, when they found that unemployment was at the rate of 12%, they reduced the working hours by 12% and made it 35 hours a week so that everyone will get work. Any extra work will attract overtime. I still do not understand how this works. But then Socialism never had any logic, and France is a Socialist country.

We had transferred an Indian national to France. He was transferred from India. The Indian HR head did not bother to check the working hours in France and just issued the transfer orders stating the terms and conditions are the same, except for the salary. This is the normal format used. The office hours per week were 35. But this Indian expat had an Indian boss. And because the boss used to work late, he got the subordinate also to work late. 11 months down the line, the subordinate resigned to join Total oil company. When his settlement check was given, he took it happily. But one week later, one of the resigned employees' friends told him that he also needs to get payment for the overtime to him since he put in more hours than the 35 hours a week. He wrote to the Indian boss. The Indian boss did not bother to check with HR and instead refused to pay since the resigned employee was a manager, and he was transferred on the same terms of the previous assignment. The resigned employees had, incidentally, signed the overtime sheets and handed over to the boss when he was getting the clearances, and he was advised by the Indian boss that since he is a manager, he is not entitled to overtime and to remove the overtime sheets.

The employee then wrote to us. We passed on the mail to the France HR team. The HR team stated that he has to be paid overtime. The Indian boss said no. We insisted on getting a legal opinion, and when a legal opinion was taken, the lawyer advised us that the local laws supersede the terms of appointment. If we do not comply with local laws of working hours, then the fine that we would have had to pay would have been at the rate of 120,000 euros per week of violation. (This is calculated in terms of the size of the company). Hence, it had to be paid. And mind you, the employee got overtime pay equivalent to over 7 months' salary.

I hope I have been able to clarify to you how International HR operates.

Regards

Sir ji, wonderful and classic response ! I am really thrilled to go through your exhaustive reply, that too, in a very simple language and words. Many many thanks.

I am a new member of CiteHR, joined only a couple of months ago, and occasionally we get opportunity to read such posts, which are worth remembering forever, considering the value of information/knowledge, stored in it.

My heartfelt special thanks to CiteHR also, who have offered us this platform, to share our views, and because of CiteHR, readers like me, can get an opportunity to get associated to many knowledgeable, respectable, and high designated personalities.

I am sure, other readers, too, must have found your post, very interesting and useful, especially to know the applicability of rules to jobs outside India.

In the first line itself, where you have introduced yourself, I understood that further readings will be the intellectual lecture. And Sir, it is really a great pleasure, to read each and every line, written in this post, since it is justified with excellent practical true examples.

We can make use of such post, not only to keep the same in our memory by updating knowledge, but also to spread such information to all the concerned people around us, collegues, relations, neighbours etc. who make plans for jobs abroad.

Coming back to subject, with due respect to you, don’t you personally feel that Indian company, who have appointed an employee, and send him abroad for some work, when he desirous of RESIGNING over there, has something to follow from Indian appointment letter !! Or, still the answer is big NO.

Hope, I am not making you annoyed. Since my inner conscious, and inquisitiveness, is not allowing me keep quiet, my querry is repeated. Please excuse me….

Abhay,

I understand what you are stating. One needs to understand the terms of the Visa on which the person is working. In case a person has been sent on a Business Visa, then the law of country from where he has gone will apply. But, once a work permit is issued the employee becomes a resident of the country of posting and hence the local laws apply.

For example, you have a customer in the United States. He has some issues and you have to visit US to resolve it. The US consulate will issue you with a B 1 visa. This is basically a Business Visitor Visa. Under this Visa, you are allowed to do all duties, but cannot do any activity which is considered as employment. And during your trip, you resign from the job. Then Indian terms and conditions apply because you are not a resident of United States and you are legally employed by your Indian company.

But, instead, you are working in India and there is a project to be completed in the United states with a client. You have to be based in the United states to complete the project and cannot do it from India, similar to most IT professionals. You will be issued a H Visa and the sub category of the Visa such as H1B or H2A or H2B will define your profile. Once you obtain this Visa, you automatically become a resident of the US. Despite the fact that you are employed with an Indian company, the laws of United States will supersede the terms of your appointment. This is where most companies falter and misconstrue that the terms of the Indian company are applicable and in the process, get prosecuted. In fact there are many case histories of IT companies where they have been penalised hugely for this violation.

There is also one more sub category in the H Visa, which is the H 3 Visa. In this category, say, you are being sent by your company to the United States for some training for certain skill sets with either your vendor or any parent company or any other place, which necessitates you to stay for a period which cannot be considered as a short visit, then H3 Visa is issued. Under this category, the terms of employment of the Indian company will be applicable, since under H3 Visa you are undergoing a training and are not employed in the United States.

There is also a L type of Visa. Under this Visa you are transferred to United states from the payrolls of the Indian company to the payrolls of the US branch or head office or the US unit, then you are resident of US and US laws fully apply.

Just as above, all countries have categories of Visas. So, when an employee is on a work permit, he automatically becomes a resident of that country and from that day, the laws of the country in which he is resident will apply.

Now, from the query of our friend who is based in Australia, it is very clear that he is on a work permit and not on a Business Visa. This means, the laws of Australia apply and it supersedes all terms of employment. But, in case he was on a Business Visa, then the terms of employment letter issued in India would apply, subject to compliance with Indian laws.

I hope this clarifies any doubts you may have.

Regards

You will have to obey the law of the host country. Whether the company is Indian or Australian, you will have to follow Australian laws.

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Thank you for this opportunity to assist you. If you have any more questions or need further help, feel free to ask.

I want to write a thesis on "Training in the service industry". Can I collect data by using this forum?

Regards,
Sultan
Pakistan

Hi, I came to Melbourne on a 457 visa but obtained my 186 visa independently. Now, I am a permanent resident and have received an offer from a local company. However, my employer is requesting me to serve a notice period in India. Is it legal for the company to ask an employee to fulfill a notice period in India even when I have another job offer in Australia? Please help.