Facing Suspension Without Pay: How Can I Transition to a New Job Amidst Allegations?

Dear all, I joined a private organization as a senior credit manager for industrial equipment finance in May 2015 after leaving my government bank job. After joining, I learned that the company's operations were halted, and they would be merged with their parent company. While assisting the collections team and searching for a new job, the product head of the parent company contacted me in December. They expressed a need to secure industrial equipment loans in their business loan domain and offered me an easier absorption if I provided suggestions and financial analysis.

Subsequently, the parent company initiated the loan process based on my financial analyses and recommendations, although I had no authority to meet with dealers or clients. My role did not involve sourcing, documentation, verification, disbursement, or approval of the deals.

In April 2016, the subsidiary employees were absorbed, and I was offered three months' upfront salary upon leaving. However, I requested to serve my three-month notice period, which was accepted, making my last working day August 1, 2016.

On July 1, 2016, I received an email from the audit team regarding a deal sanctioned in February 2016, disbursed in March 2016, which had turned bad. The audit revealed overpricing of machinery and alleged fraud by the dealer and client. The audit team accused me of gross negligence for failing to verify the asset's market cost. I responded with an explanation on July 2. Subsequently, I received a show cause notice dated July 2, 2016, on July 4, indicating that my resignation was unaccepted. I replied to the notice, following which I was suspended on July 12, 2016. The suspension was attributed to the substantial loss incurred by the company due to my alleged negligence. The suspension remains in effect until the issues mentioned in the show cause notice are resolved or settled.

I attended a job interview on July 10 and successfully secured a position. I seek guidance on how to proceed. I aim to transition smoothly to the new company. Is the suspension justified, and what are my available options?

Thank you.

As per my legal knowledge, you need to clear your case from the previous company's inquiry, or else the new company, upon verification of credentials, may find your job at risk. Please be aware that if you do not appear in person, the company may file an FIR against you at their jurisdictional police station and initiate a criminal case, along with other legal actions for the recovery of their funds, which could jeopardize your credibility.

In these circumstances, it would be better to discuss with the company management for an out-of-court settlement and obtain a clearance certificate from them. Please remember that in the future, when conducting financial transactions, you must ensure that the loan application and the client's project details are correct. If needed, verify them with the company's registered evaluation consultants, who possess the latest market data that will be highly beneficial to you.

Regards

You are entitled to 50% of your salary for the first three months of suspension and thereafter 75% of your salary for the rest of the period until you remain suspended. You can demand it in writing.

The company is not conducting any inquiry. According to them, my gross negligence has been established, and they have suspended me until the account is resolved. The price of the machinery is debatable, and the dealer has already met with the management for clarification on the price. At the time of the proposal's sanction, I was an employee of the subsidiary, while the account was booked in the parent company. The parent company did not provide me with any credit policy or procedure. I was asked to provide my suggestions for the deal and had no access to any documents related to it other than the financials of the borrower. The company had no registered evaluators. Now, the parent company wants to blame me for everything and save their own employees involved.

Regards

Whatever the reason may be, you need to discuss the issues case by case with the present management and try to close the matter as early as possible, since you have one more assignment waiting for you. Please do not miss any opportunity. Now you have a fair idea of how the private sector works. Working in the government sector is totally different from the private sector. When drawing any conclusions pertaining to loans, etc., you should be abreast of the information; only then will success come your way.

All the best for your new job. May God bless you.

Regards, Ankit

Addressing Allegations and Seeking Resolution

It seems that the company suspects you of having indulged in a fraudulent act. The company may initiate criminal proceedings against you while simultaneously taking disciplinary action, which is already in progress. You may consider approaching a legal expert for better advice on whether you can proceed with an amicable settlement with the company by compensating for the damage caused, either wholly or partly.

Furthermore, it seems that you indirectly admitted that something happened behind the scenes in these dealings. Try to settle the issue so that no harm is caused on either side. Think about this and act diplomatically.

I have no idea what happened behind the scenes. The borrower is absconding and has sold the equipment to someone else. There might have been some documentation lapses since they don't even have the insurance policy for the machine. The borrower claimed his house to be self-owned, but now they have found out that it was rented. Still, they have not questioned their operation team, and these things are not even mentioned in the audit report. The audit report contains only one issue: that the machine was overpriced and the dealer is a fraud. The dealer is renowned and works with many big financial companies. According to my lawyer, they don't have any case against me, and they have not even followed any procedure. My lawyer also mentioned that I had no employer-employee relationship with the parent company at the time of sanction.

So far as the justification of your suspension is concerned, that can be confirmed or denied only after you mention what the exact market price of the machinery is, what the invoice of the machinery in question shows, what is the exact objection of the audit, and whether only you were involved in the approval of the loan, or if other functionaries were also involved in the transaction. Your question is quite vague in that respect.

About your assumption regarding suspension until eternity, that is also an exaggeration on your part. No suspension goes on for eternity, especially when the management has clearly mentioned, "till the account mentioned in the show cause is resolved or settled."

It is not understood what the hitch is for you in ascertaining the market value by yourself and getting 3-4 cost estimates of the machinery from the open market to clarify the issue with the company and the audit. If you have been suspended on that specific ground, you should have acted with speed to clear that issue.

So far as your selection in another company is concerned, if you join the other company before being officially relieved from the present company, your case would become one of double employment, for which you can be subjected to disciplinary action, not only by the present company but also by the new company for concealing the facts from the employers.