Dealing with Absconding Employees: Are Employers Liable for Notice Period Pay?

I am working in a Lead Generation company where I face one-day resignations and absconding employees. My question is: Is the employer liable to pay the employee if he does not serve the notice period or if he is absconding? Please suggest.

Thank you.

Your query depends on the appointment letter clause. If you have specified in the appointment letter that not serving the notice period will result in a pay cut, then you are right. Otherwise, you don't have a choice but to pay the employee. Legal actions taken under any labor law will be against the company, as labor laws are designed primarily for the benefit of employees. You need to pay until the last date the person has served you.

Hope this clears your doubts.

All the best.

I would disagree. If the appointment letter provides a notice period, that is the best, as you can follow that. If the appointment letter does not provide the same, you can refer to the terms of employment, employee handbook, etc. Where that is not available, you can refer to the Model Standing Orders. It has the standard notice period. Some of the state Shop & Establishment Acts also specify notice periods. If nothing else, you can refer to the custom of a one-month notice period.

You are free to deduct the notice pay from the amount due to the employee on account of his wages for the period worked. It would be a good idea to keep the working of individual employees' F&F in the file for reference and to defend yourself in case of any complaint. Also, make it a practice to send a notice to each employee who has absconded asking him to complete the notice period or to pay the notice pay to the company. Keep a copy of the same along with proof of delivery (registered AD, POD of courier) in the file for reference.

I echo Mr. Banerjee; you have to send a notice to the employee stating the clause mentioned in the Appointment Letter, Employee Handbook, or Standing Order that the employee has to complete the notice period or provide Notice Pay to the company. In the absence of any reply to the notice, the company can forfeit the dues from his FnF.

Notice Period and Service Conditions

The notice period is part of service conditions that are governed by various enactments applicable to employer/establishment/employee. For example, Standing Orders (certified/Model), (Name of the state) Shops and Commercial Establishments Act were enacted to govern the service conditions of employees working in such establishments. These are instruments of law/statute/Act that shall prevail over any private agreement drafted by the employer, be it an appointment letter/HR policy/service Rules and Regulations/contract of employment/service agreement, etc.

Thus, if the notice period as per these enactments is NIL, then any notice period stated in the appointment letter/HR policy/service Rules and Regulations/contract of employment/service agreement, such as 15/30/90 days, shall be VOID. Consequently, no notice pay can be adjusted.

The maximum notice period (as per length of service, confirmation of service, etc.) is 30 days. Therefore, if the notice period is applicable as per the enactments, notice pay can be adjusted; otherwise, NO.

Communication and Termination Procedures

The company should issue communications (preferably by Regd. post), show-cause notices as per standing orders, and issue termination orders on record.

As per Model standing orders, the employee shall lose lien on employment after unauthorized absence of 10 days.

The employer is bound to supply the service certificate and payment of FnF wages on the day of termination.

Resignation and Notice Period Adjustment

In the case of an employee's resignation, the shortfall notice period pay can be adjusted at the time of the Full and Final (FnF) payment adjustment, as stated above, especially in terms of statutory enactment applicable.

Handling Absconding Employees

However, where an employee has simply absconded, absconding is construed to be misconduct for which a proper inquiry has to be conducted and punishment imposed, as per the ruling in the case of M/s Economic Transport v Dharmendra decided by the Delhi High Court in 2014.

Thanks

I am in full agreement with Mr. Sushil K Luthra and appreciate the thread for citing judgments by the court of law. This effort aims to inform the community of employees, including the affected individuals, as well as the HR and legal personnel fraternity.

The cited judgment highlights, "Abandonment amounts to misconduct, which requires a proper inquiry that has not been conducted in this case. So, abandonment is not proved."

In addition, the misconduct alleged by the employer should feature in the list of misconducts included in standing orders. There are judgments that state misconduct not included is not considered misconduct. Supreme Court of India Glaxo Laboratories vs The Presiding Officer, Labour...