Confused About Resignation vs. Termination: Can I Claim Termination Pay?

I have been working in a private software firm for 5 years in India. Recently, my company owner suggested that I should separate from the company. I am now confused about whether to follow the official resignation process or consider this as a termination. If I consider it as a termination, can I ask for termination pay since he didn't fire me? How is termination pay calculated, and what should be my next step if he denies giving it?

Dear Nilesh, Your communication is confusing regarding whether you have stopped attending the office on the advice of your boss or not. If you have stopped attending the office, you are on your own. If not, you should tender your resignation, have it accepted, and be relieved in a formal manner. In such a case, you are entitled to receive all your dues.

Thanks and regards,
S.K. Johri

I think you should ask for a notice period from the employer's side. If he denies it, you should ask for termination pay according to the company's standard notice period.

When you have completed 5 years of service with your company, and your boss is asking you to quit the job, can you tell us why he is asking you to do so? Is the company incurring losses, or are there no projects available? Or is it to evade the payment of gratuity, etc.? Are you receiving PF and other social security measures like ESI, etc.? Generally, traditional management or one-man organizations should not adopt these tactics to avoid providing benefits to their employees. In your case, if your boss has asked you to quit the job, it should be in writing from his side or through a resignation from your side. In the absence of the above two, your absence from duty amounts to misconduct, and the same is liable for disciplinary action if your company has standing orders/service rules.

Advice on Resignation or Termination

So, my advice is first, you should decide to quit either by tendering resignation as per the terms of your appointment order or by receiving a termination order from the employer, which is not good for your future employment. In any case, since you have completed 5 years of service, provided you have worked not less than 240 days in every completed year of service for 5 continuous years, you are entitled to gratuity at the rate of 15 days of average pay for every completed year of service. Termination pay is different from gratuity. If the employer wants to reduce excess manpower for any reason other than punishment inflicted, then they are required to pay retrenchment compensation as per the provisions of the Shops and Establishment Act or Industrial Disputes Act, for which the calculation will also be 15 days' wages for every completed year of service.

Regards

Thank you, nvraovskp, SAMARPITA. G. PRAMANIK, skjohri1. Well, all of you are suggesting that I should send an official resignation letter. If I do resign officially, can I still ask for termination compensation? It's fine with me if he terminates me. What procedure should I follow next?

Your next step will be to be clear about the clearance procedure, F&F settlement, and the relieving certificate with a good remark. Is management ready for this or not? One thing to note, before signing a copy of your termination, read it carefully. Your company suggests that you separate from this organization, and this should be reflected in that letter. They should not include any negative comments about your performance or behavior in that letter.

Thank you.