Can We Terminate a Probationary Employee Without Notice or Salary? Seeking Advice

One of our employees is being transferred to another location. However, he is refusing to relocate. The company wishes to terminate him without giving him notice. He is still on probation. These are the clauses mentioned in the Offer Letter:

Probation Period

You will be on probation for six months. Your confirmation will be communicated to you in writing. The company reserves the right to terminate your employment if your performance, behavior, and conduct during the probation period are found unsatisfactory.

Notice Period

During your employment with the company, either you or the company can terminate the appointment by giving 30 calendar days' written notice or 1 month's basic salary in lieu of the notice unless an Employment Bond is active (NO BOND ACTIVE). The company also reserves the right, if it is in the interest of the business and current assignment, to ask you to complete your notice period or decide whether your existing earned vacation or basic salary in lieu of the notice period may be adjusted against the entire or partial notice period.

Kindly suggest how to terminate him without giving him 1 month's salary or notice.

Dear friend, you have provided an excerpt of the appointment letter. However, during the probation period, the notice period clause is generally not applicable. This clause only becomes applicable once the employment is confirmed.

Nevertheless, at this stage, I recommend issuing a Transfer Order (TO) to the employee. Issue it on the company's letterhead. Clearly state in this order the type of job he will be doing, his work location, reporting manager, and the date he is expected to resume duties at the new office. Provide the original copy to the employee and keep a photocopy signed by him in his personal file.

If the employee refuses to accept the TO, it will be considered misconduct. In such a case, issue a show cause notice, and upon receiving a reply, you may proceed with terminating his services.

Even if the employee accepts the TO but fails to report for duty at the designated location, it will still be considered misconduct, and disciplinary action can be taken.

It is essential to review the notice period clause in the Appointment Letter. The process of removing a probationer should not be overly complicated. However, due to the lack of clarity, your company has introduced unnecessary complexity into the procedure.

Thanks,
Dinesh Divekar

Dear Anonymous, As the employee is still in his/her notice period and is refusing to relocate, you can terminate him/her based on the Terms of the Appointment letter. However, this cannot be clubbed with conditions 1 or 2 mentioned above.

If the appointment letter has terms mentioning his/her base location (current location) and a clause stating he/she may be required to work at any other company premises or the premises of another client or Group Company, as it may consider necessary, and if and only if the employee has agreed and signed this condition, he can be terminated on these grounds.

However, I would suggest giving the employee 2 days' written notice and terminating his employment with severance pay.

Regards, Ramya

As he is still on probation and has not even completed six months of service, no right accrues to him legally. Your Notice Period clause is umbrella-type and covers the entire period, thus requiring the observance of the notice period. However, owing to the lack of any legal right, you may go ahead and terminate his service by quoting the rule mentioned above. In case the employee challenges, you may plead the unsatisfactory nature of his service and justify the action. As Dinesh Divekar Sir has pointed out above, you may consider revising the appointment terms to clarify the position regarding the notice period during probation. Mind you, it cuts both ways, as the employee could also leave suddenly.

Relocation and Termination Considerations

It is nowhere mentioned that you can relocate or transfer the job/services of an employee as and when required. It would be better to terminate with notice, remaining free under the clause of notice and transfer. You could have removed the probationer in the absence of point no. 2 or if point no. 1 states, "You will be on probation for six months. Your confirmation will be communicated to you in writing. The company reserves the right to terminate your employment without notice in case your performance, behavior, and/or conduct during the probation period is found unsatisfactory."

In regard to your query, several opinions have been provided to follow. You should discuss with your management to decide the course of action.

Transfers are an integral part of the job profile of every employee. One cannot refuse transfers. Refusal will amount to a breach of company regulations, and action can be taken following procedures. In this case, the company should act on the refusal to move on a transfer.