Senior Employee Asked to Resign: What Compensation Should They Expect Without an Appointment Letter?

Hello Learned Members,

Please read the below case and share your valued suggestions.

Case Overview

A senior professional with over 20 years of experience joins a Pvt. Ltd company upon receiving an offer letter. During the finalization stage of his selection, the MD mentions a 2-year service contract from both sides. However, despite many requests, an appointment letter is not issued to him like other employees. The company is experiencing a serious employee attrition rate, including within the HR department. In the past 6 months, at least 25 employees have joined and left the organization.

Employee Performance and Management Issues

This senior employee performs well and receives praise from the management. However, just 4 days before completing 6 months of service, the MD unexpectedly asks him to resign when the employee tries to correct a statement made by the MD. The MD holds lengthy meetings with key personnel every day for 6-7 hours, with varying expectations each day, leading to frustration and tension among employees as valuable working hours are wasted daily.

There are no issues regarding the employee's performance, conduct, or discipline. No memos or show cause letters have been issued against the senior employee.

Upon being asked to discontinue, the employee stops reporting to the office.

Compensation and Dues

In these circumstances, what dues as compensation is the employee entitled to receive, such as notice pay, leave, bonus, severance pay, etc.? Since no appointment letter was issued despite requests, what should be the notice pay considered here? During the 6 months of work, no leave in the form of EL/CL/SL was paid. The few leaves taken by the employee resulted in Loss Of Pay.

Employer's Approach

Based on past records, the MD has a history of firing employees after 3-4 months of service.

What should be the right approach for the employer to follow going forward?

Best Regards,

Difficult circumstances are evident in the company. However, it would be wiser to move on and not get involved in legal battles for notice period pay. There are no documents to support your claim, not even an appointment letter. Correcting your boss is fraught with danger. As an experienced person, it would have been best not to have joined without a clear offer letter with terms and conditions. How the Managing Director behaves with employees will not matter unless they also engage in a legal battle. This is not a battle to be taken up. Look around for other jobs and consider leaving this employment as a learning experience.

I am saddened to hear about the difficulties you are facing, and it is indeed unfortunate. Such exploitation should not be tolerated. I advise you to gather the necessary documents to support your employment claim. Please ensure you have the following documents at hand:

1. Proof of the salary credited to your account by the employer.
2. A photocopy of the attendance register.
3. Any official emails sent during your employment.
4. Details of any PF or other accounts.

Regards

Dear Navin Sir,

Thank you for your strong and true response. Please note that the employee has all the documents with him as suggested by you. Please share your inputs to move forward, at least to get/claim justified dues (notice pay, bonus, entitled leave, etc.) from the company. Our legal provisions don't permit employers to hire and fire without a valid reason.

Thanks & Best Regards,

In my opinion, there certainly is a cause of action when the employer makes circumstances impossible for him to continue in the employment without any just cause and following the due procedure. It does not matter whether there is no appointment letter issued. However, the crucial aspect is in proving that the employee has stopped attending his duties because of the MD asking for his resignation. Otherwise, it will only be that the employee has absented himself.