How Should We Handle Employee Misconduct and Potential Termination Without Written Proof?

Seeking Advice on Employee Misconduct and Possible Termination

I am here to seek some advice and guidance on an important matter.

One of our employees was recently identified as being involved in activities such as spreading rumors on the floor about starting his own company and influencing some key people to join him. His performance significantly dipped during the same period over the last one to two months when he was engaging in these talks. We were informed by the employees themselves that he is talking about opening his company and asking people to join him there. He even had an informal discussion with his PM (it's a newly appointed PM, and they don't have any formal friendship as such) that he will soon leave the job and will also take away some of the key members, so he should be aware of this and plan hiring and projects accordingly.

Meanwhile, a senior resource came to us and said that he was shown a chat between that employee and one of our existing clients on WhatsApp, where the employee was trying to influence the client by claiming he had acquired clients and suggesting the client should consider joining his new company.

When these incidents were reported to us, we proceeded to have a discussion with him in which we found him guilty based on the way he was presenting his points and changing his statements. However, he cleverly claimed that he was just kidding and wasn't serious about any such thing. We also discovered that on the previous day, he was on leave on medical grounds but went to an interview at another company (this was admitted by himself). He didn't seem serious about the matter, so we issued him a show cause notice and asked him to reply in writing. In the meantime, we suspended all his access from office accounts and didn't allow him to work.

He has submitted an explanation stating that he wasn't serious in those talks, he didn't approach any client, and neither does he wish to open his own business. We are not at all satisfied with his response, and it has seriously affected the culture on the floor. We would like to send a message to people that we are serious about issues like this when someone spoils the culture or tries to interfere with our business or clients.

The only problem is that we have nothing in writing against him. He is denying it, but we are certain that he was engaging in such behaviors on the floor, as many people have confirmed the same.

My question is: Can we go ahead and terminate him over this matter? Or what else can be done in a situation like this?

I would appreciate it if some legal experts and senior individuals from the community can help in this matter.

Regards,
Pradeep

First of all, take statements from floor employees regarding any negative remarks he may have made about the company that could potentially harm the positive work culture. If the majority of workers are willing to provide statements, issue another show cause notice to him along with the supporting documents. Additionally, inform him that if the company is not satisfied with his responses, disciplinary action or termination may be taken based on this matter.

Thank you.

I understand your point; however, not everyone will be so open to giving things in writing. I also think that it may even work against the culture. People are very loyal to us, but no one would like to be the reason for anyone's termination, nor would anyone like to come forward to make a written complaint. On the other hand, too much involvement of the people may lead to spreading some fear; in the future, even if such things happen on the floor, people would prefer to keep it to themselves instead of bringing that to the notice of management, considering that they will be dragged into a lot of paperwork and proceedings. I would like to avoid involving people too much and keep the culture on the floor light and open.

Correct me if I am wrong. I understand that this will make it difficult for us to terminate that employee or take any other strict action against him, but that is what is making this situation a bit tricky.

Alternate Solutions

What else would you suggest for us, any alternate way out?

Regards,
Pradeep

Issue him a memo containing all the words he discussed with employees. If he repeats the same thing, then terminate his service.

Whatever is said and done, without initiating a formal inquiry, your case is not legally strong if you terminate him in case the inquiry concludes in finding him guilty. It's up to you on how to build a strong case of indiscipline as per your own standing order and prove him guilty of the charges to be framed and successfully defend your action if the case is dragged to court. Recording the irrefutable statements of key witnesses is first and foremost (even using a CCTV camera or a tape recorder if the law permits). Probably you should build a prima facie case of guilt on charges and place him under suspension pending inquiry, which will send a strong signal to all his subordinates, and they'll come forward to testify to the truth. Supposing the key witnesses backtrack when the actual trial begins, your case becomes very weak, and ultimately, you lose the case. So, depending on the circumstances, you should proceed while keeping your awareness on the impending litigation in court.

I agree with Sh. Kumar S. that you need to build a strong case of indiscipline against the individual in accordance with standing orders and prove him guilty of charges. I know this is a long-drawn process, which sometimes stretches on for years. The presence of such persons is always detrimental to the organization; hence, it is better to get rid of them at any cost. I suggest that you obtain resignation from him and relieve him from his duties immediately, even if you have to pay some money.

Regards,
BS Kalsi
Member since Aug 2011

Thank you, folks, for the advice. I kept him on suspension for the period when we were investigating the case. I think it's right that we need to document some statements and documents to ensure that our case is strong enough in the court of law if it goes to that extent. We have decided to get rid of him. I gave him a show cause notice to which his response was absolutely not acceptable. He did accept that he talked about opening up a company, but it was in fun, not real.

We have decided to terminate him based on the proofs and complaints we have so far. We shall be collecting more documentary evidence before giving his termination to him.

Termination and Notice Period

I would like to understand, in the case of termination for such reasons, do we have to give him the salary of 1 month against the notice? In our rule book, it is clearly written that on ethical integrity and any other misbehavior or any inappropriate activity, we can terminate the employment without any notice or compensation with immediate effect.

Please share your views.

Regards,
Pradeep

In connection with your last paragraph of your email where you have used the term "rule book," I would like to know what exactly this is. Is it your company's code of conduct, or are these certified standing orders of the company? You may want to review the terms and conditions outlined in his appointment letter as well.

You are correct in mentioning that in normal conditions of termination simpliciter, one month's notice is necessary, but termination due to any misconduct specified in the conduct rules is immediate without any notice or compensation.

I still stand by my suggestion to obtain resignation from the employee and release him from his duties immediately to prevent potential litigation in the future.

Regards,
BS Kalsi
Member since Aug

I am referring to our rule book (Handbook) but not the certified standing orders. Yes, the appointment letter has the clause of immediate termination without any notice or salary in case of any misconduct.

I agree with your point about taking resignation from the employee, but the employee is already not coming to the office; he has already joined somewhere else. Furthermore, this situation has led to a lot of discussions on the floor. Such unwanted actions should be dealt with strictly to establish the right parameters for the future.

Correct me if I am wrong.

Regards,
Pradeep

The reason for my suggestion for the resignation was that this is a case of rumor-mongering, which normally exists in all organizations in some form or another and is difficult to substantiate, particularly the chat on WhatsApp. There are certain employees who are habitual loose talkers, whom the company should ignore. The colleagues of such employees also know them better, and as such, they don't take them seriously. Instead of trying to prove such activities, you should initiate action for his low performance, which you have said greatly dipped during the period when he was indulging in spreading loose talks amongst his coworkers.

I agree with you that unwanted acts like this should be dealt with strictly to set the right parameters for the future, but your main aim should be to get rid of such persons, maybe by terminating his services on the grounds of misconduct or by compelling him to resign from service. His future course of action of protesting against his removal from the service mollifies in case of resignation.

Regards,
BS Kalsi

I fully agree with the point that Mr. Kalsi is trying to drive home. It's a difficult task to prove that the loose talks the person is habituated to are "guilty." It's necessary to determine and define what constitutes "misconduct" and whether his behavior can be construed under this category. Did he really conspire against the interests of your company? Merely revealing his future plans and asking his colleagues to join him in his endeavors, in my view, cannot be considered a serious offense warranting capital punishment like termination straight away.

Probably you should institute a formal inquiry, charge him, and if found guilty, you can at best try inflicting some minor punishments like a severe warning, increment cut, transfer to other places, demotion, etc. If he is not correcting himself and continues the offense, he may be asked to resign. I'm suggesting this only keeping in view the prospects of winning the case in the court of law consequent to your action.

Below are my suggestions:

1. If the employee is still working, you need to terminate him with immediate effect. He cannot approach the court as he himself is at fault, and as mentioned in the appointment letter, a company has all rights to terminate an employee if found guilty or disobeying company culture/rules.

2. If the employee has already left, find out which company this person has joined. You need to call and speak to the HR of that company. Inform them that this person has a negative work background that could potentially affect their organization's culture.

By doing this, this person may or may not lose his job, depending on the policies of the other company he has joined. However, it will definitely spread among the current employees that the management will not tolerate misconduct at work and will take strong action against the employee.

Your current employees will understand that the company will not tolerate any misconduct at work.

BS Kalsi has given valid justifications to opt for the Forced Resignation route rather than Termination. Since the employee has already joined elsewhere, like another member suggested, speak to the HR of his new company. Though, it would be better to FIRST speak to the employee before contacting the HR, frankly—given what you mention about his attitude/nature—that would only help to alert him about your Plan of Action and enable him to play out another drama with his new employer. And since they don’t know him well, as yet, he can come up with SEEMINGLY convincing reasons. However, I think he ALREADY must have told some sort of a story there—how else was he allowed to join WITHOUT any Relieving/Experience Letter? I would suggest you assign someone to get the inputs on how he joined there and prepare your move before you talk to that HR and get his resignation letter.

Regards,
TS