How to Handle Employee Theft: Can We Terminate and Withhold Settlements?

Hi All,

One of the employees is involved in serious misconduct of theft. When we have asked the employee, he is not ready to accept it. Kindly provide the details on how to terminate the employee on the grounds of misconduct. Also, clarify if we can hold his F&F settlement, PF, and gratuity.

Regards,
Akhil

He is not ready to accept it. So how do you know that he is actually guilty? And what documentation will you have to prove the same? Will the domestic enquiry actually prove his guilt? If so, then you can terminate his employment after the domestic enquiry. The amount of the theft can be adjusted against full and final settlement.

Please conduct a domestic enquiry and, based on the report of the enquiry, you can take action. Since theft is a serious issue, do your homework properly so that charges can be proved against the employee without hampering the principle of natural justice. Otherwise, his termination will be unlawful, and if he challenges it, he will be reinstated with back wages.