FIR Filed Against Employees for Fund Manipulation: Should We Wait for Police Inquiry Before Termination?

A company has already registered an FIR against 3 employees; no domestic enquiry was done. The case involves the manipulation of funds intended for the materials to be sold. Now, the company wants to issue termination letters to these 3 employees. Is it okay to issue them, or should we wait for the police enquiry?

The purpose of lodging an FIR and holding a domestic inquiry are different. A separate domestic inquiry has to be conducted. Based on the police inquiry, no action can be taken. Only after the employee is convicted can reliance be placed, but this process will take a long time. Therefore, immediately issue a charge sheet to the employees and conduct a domestic inquiry.

Thanks,

Sushil

As our eminent member Mr. Sushil replied, an FIR by the police and a domestic enquiry are different. You need to serve a chargesheet, get an explanation, conduct a domestic enquiry, and dismiss these employees based on the charges proved in the domestic enquiry. Otherwise, your company may face legal consequences if the employees choose to appeal for illegal termination.

Domestic Enquiry and Legal Proceedings

A domestic enquiry by the firm should have been conducted first, and guilt established. Documents that were manipulated, the amounts involved, how the manipulation took place, the loss to the company, and how much was illegally gained by the concerned employees need to be elucidated and proved. Once this proof is available, they could have dismissed the employees and lodged an FIR as well.

Placing the cart before the horse approach can only complicate legal matters. The police may not do such a skillful job of proving manipulation and misappropriation of company funds. One needs to take actions carefully, keeping all aspects in mind. Avoid hurried steps that will delay the whole proceedings.