Employee Resignation Without Notice: How Should HR Handle Termination and Legalities?

Employee Resignation and Termination Process

I am an HR professional in a private organization. Here, in our organization, employees are required to work for 30 days after submitting their resignation. However, one of our employees was on leave without any prior notification, and today, suddenly, we received his resignation. As a result, the management has decided to issue a termination letter to him.

Seeking Advice on Procedure and Legalities

Could you please advise on the appropriate procedure in this situation? Can the company withhold his payment? Are there any specific laws related to this matter? Kindly provide me with the relevant legal clause or policy pertaining to this issue.

Thanks and Regards,
Tanisha

Dear Tanisha,

This is in reference to your query regarding resignation from the service without serving notice.

As you mentioned, it is a practice in your company to serve a 30-day notice before leaving or resigning from the service. I believe you would have included the same clause in your employees' contract agreement or appointment letter, which should be acknowledged by your employees and recorded by you.

According to the above-mentioned clause, you can deduct his 30 days' salary in lieu of notice from his full and final settlement and release him from the service.

Regarding the termination of service, you have to reject or not accept his resignation in writing and send him a call letter stating to report for duty within 2 days of receiving the call letter. Whether he reports or not, you can initiate further disciplinary procedures leading up to termination.

Please note, if you terminate the employee after following the due process of disciplinary action, to safeguard against future challenges, you have to pay him one month's average salary in lieu of the notice period (referencing the notice period clause in the employee contract agreement/appointment letter).

For a detailed understanding of the disciplinary action procedure, please coordinate with your company's legal team or legal adviser.

Best regards, [Your Name]

Dear Madam Tanisha, it would be a fruitless exercise to follow disciplinary action in this case, which may suffer from legal infirmities.

What is the misconduct?

Will the failure to give one month's notice be such a serious misconduct that will warrant dismissal? Besides, if a domestic enquiry is instituted, will he attend it after having left the job? All these will pose practical and legal hurdles and may not be worthwhile to go through. Better to adjust one month's salary against his dues and be done with it.

Regards, Vinayak Nagarkar HR Consultant

Dear Tanisha, you are saying that the employee has to work for 30 days after giving resignation. Is this 30-day notice a practice or a service condition of employment? In this case, you should inform the employee that we have received his resignation, and his employment will end on the date...... (30 days from the receipt date). If the employee fails to serve the notice period, management will deduct one month's pay from the full & final settlement. Follow Mr. Nagarkar's advice.

Thank you.

Thank you so much, team, for guiding me in this matter. Below is the clause relating to the notice period as outlined in the appointment letter:

"If you wish to resign from the organization, you shall be required to give one month's notice to the company. The organization reserves the right to recover gross emoluments in lieu of the notice period. The organization may, at its discretion, relieve you from such a date as it may deem fit even prior to the expiry of the notice period. Upon the acceptance of the notice, you will be required, before you are relieved, to hand over all files, data, disks, literature, etc., including copies thereof, if any, and obtain a No Dues certificate."

Another clause relating to the notice period from the organization states:

After confirmation, your services shall be liable to be terminated on 30 days' notice or salary in lieu of, except on disciplinary grounds, in which case no such notice or payment in lieu thereof shall be necessary.

Today, I am sending a reply for his resignation stating that your resignation is not accepted, and he has to report for duty in 2 days. Please guide me based on the above-mentioned clause. What should be our next step?

Thanks & Regards,
Tanisha

Procedure for Handling Employee Resignation

Please draw attention to the clauses relating to exit. Your letter should be specific and to the point. Then tell him his resignation is not accepted due to a violation of a specific clause and ask him to rejoin by a particular date. If he fails to do so, adjust his dues with notice period dues and settle any balance or ask him to repay dues. Relieve him from duty at that stage after confirming that he holds no company property, data, laptop, pen drive, etc.

The letter should be sent by email and also by Speedpost to ensure the delivery of the letter. Proof of delivery by Speedpost can be obtained by using the tracking facility of Speedpost.

Regards, [Your Name]

Dear Tanisha Madam,

The relevant clause relating to the notice period as quoted above does not state that you have the right to refuse acceptance of resignation. On the contrary, it provides for recovering one month's salary in lieu of notice. Therefore, it is improper on your part to convey refusal as well as asking him to report, which is not part of the terms of employment. You may be landing yourself in a potential dispute.

Regards,
Vinayak Nagarkar
HR Consultant

Consultation on Resignation and Termination

If you have already decided not to accept his resignation, then what is the need to bring the issue here for consultation?

I will go with Mr. Vinayak Nagarkar's advice on this subject.

If your intention is to stop payment to him, you can do so even now without any issue.

Indiscipline and Termination

If your intention is to terminate him, then what is the indiscipline he has committed? His absence from work is the indiscipline, and termination may be considered a severe punishment for first-time offenders.

He does not want to work with you, and you do not want him. He has given a resignation letter. Why complicate? Accept and deduct 30 days' salary towards the notice period.

T. Sivasankaran

Dear all,

When an employee intends to resign, one should avoid legal complications such as asking them to join and then issuing a show-cause notice, etc. It is better to deduct their one month's salary in lieu of notice pay in accordance with the terms of the letter of appointment.

Regards

Accept the resignation with clarity on full and final settlement. Close the file with proper recordings and written statements so that he does not revert with any demands or action in the future.

Thank you team for your valuable guidance on the above matter. Following your advice, we have closed the file with a full and final settlement. Management has instructed me to determine the reason why the individual left our organization so suddenly, and to ensure that this situation does not occur again.