Amendment to notice period - from 45 days to 60 days for all employees - Can we do that for existing employees?

We are a SME Software company.
We are facing problem of resigned employees requesting relieving from service for lesser notice period than as per Employment agreement of 45 days. Few of the projects gets held up if we agree for such requests, especially if the resource is very important one, and cannot get replacement quickly.
Can we insist on serving the notice period as per Employment agreement of 45 days.
We are also considering increasing/ amending the notice period from 45 days to 60 days for all employees. Can we do that for existing employees who have already signed employment agreement with 45 days.
Please advice.
Thanks in Advance

Dear Vijaya,

Conditions of the employment can be changed. Earlier top notch software companies had just 30 day notice period. Later it was extended to 60 days and then even 90 days.

In your case, you need to issue letter on the extension of notice period on your company letter to each employee, obtain their signature on the photocopy and retain in the employee documents. If you wish, then you may remove clause about payment in lieu of notice period.

Since this letter is specific to notice period, you may add one sentence as "other terms and conditions of employment would remain same".

Most of the changes are not necessarily smooth and your company could be no exception. Therefore, it is better to call everybody and tell the change in the conditions of employment and then issue the letter. If you do not wish to call a meeting then at least call meeting of the HODs and tell them to pass on this message to everybody. After this meeting, issue office circular and display it on the notice board. If few staff members express their frustration, handle it nervelessly.



Thanks,

Dinesh Divekar

A job offer is a contract.
Contract is a meeting of mind on a particular subject-job.
Once the company feels the need to revise notice period for all employees,they can go ahead and frame the new policy,circulate it to all employees and get individual signatures of acceptance.
This is essential because you are getting a change done where it is adverse to the employee in many cases.i.e notice period is being revised upwards.
However it is always good to add this sentence in your offer letter:
You are required to sign a copy of this letter confirming the acceptance and compliance of the terms of offer and policies existing and modified from time to time.

Thank you very much Mr. Dinesh and Mr. Nathrao. Is it the accepted practice to get signatures of all employees for the change in the notice period. We have a SOP (Employee Handbook) as and when we make any amendments to it, we circulate it the update SOP to all employees with a version control. Is it sufficient to do so or do we need to take a sing off from all employees. For all new hire in the last 3 months, we have issued employment letters with 60 days notice. My concern is that of existing employees with 45 days notice. Please advice. In an MNC if a revision is made, do they also take a sign off from all employees. Thanks for your valuable time.

Signature is take basically to avoid an employee from claiming that he did not know of changed notice period.
It now depends on the company how to deal with the matter.

You can add following paras in your offer of appointment and accordingly revise your service rules.

During probation, the services will be liable to termination by giving One month notice on either side without assigning any reasons therefor; provided also that Appointing Authority shall have right to terminate the services of the appointee forthwith or from any subsequent date on payment of a sum equivalent to the amount of pay and dearness allowance last drawn by the appointee for the period of notice in lieu of the notice period or period by which such notice falls short of.

After satisfactory completion of probation, the services will be liable to termination by giving Three month notice on either side without assigning any reasons therefor; provided also that Appointing Authority shall have right to terminate the services of the appointee forthwith or from any subsequent date on payment of a sum equivalent to the amount of pay and dearness allowance last drawn by the employee for the period of notice in lieu of the notice period or period by which such notice falls short of.

Please note:

If you are going to change the contract of employment after employee has joined your organization, the procedure would be same. You have to make an offer, employee has to accept it within given time frame and communicate the acceptance back to the authority who proposed the offer. If this process do not get complete then the clause will not hold any legal sanctity. Once the cycle is complete, it can be modified only by following same process.

The notice period will be binding to both sides ( employee and organization). If the organization wish to terminate the services of employee, the organization also has to give termination notice in advance.

In absence of servicing notice period, the terminator of contract should be ready for payment of a sum equivalent to the amount of salary last drawn by the employee for the period of notice in lieu of the notice period or period by which such notice falls short of. Serving notice period cannot be forced as it will amount to bonded labor.

No provision of the offer are any change thereafter should be arbitrary and contradict Natural Justice. Any obliqueness will be prone to be challenged before Competent Court of Law by aware employees.