F&F payment - were paying 50% of the salary across the board due to COVID 19 - now we can't even pay that

Hello, I work in a company as HR where, due to COVID, business is totally down, and we were paying 50% of the salary across the board. Now we can't pay that also and so have to let go of a few employees whose roles are not required anymore. As per the organization, we are again reducing the salary payout for Aug 2020 to a lower scale due to absolute poor financial conditions.

My question is, if I let go of an employee whose notice period is 60 days even though we discussed and got the resignation letter from him and we do not want him to serve the notice period as we may not require his services anymore, do we pay the salary for the next 2 months as 50% for July 2020 and 25% for Aug 2020 or pay him 100%? He also has the company's assets like a system that needs to be retrieved. Please advise.

In an appointment letter, the clause of separation applies not only to the employee but also to the employer as well. If an employee submits his resignation letter on his own, will the company let him leave the organization just like that? No. Either he should serve the notice period (here it is 60 days (2 months) or he should pay back salary for two months, as salary in lieu of the notice period. The same condition applies to the employer. If the employer wants to terminate the service of the employee - for whatsoever reason - either the employer serves a 2-month notice period or pays the employee 2 months' salary. Advise them, in writing, to return the company assets before making his full payment.

Dear Sir,

Thank you very much for the timely advice. I have one more point to discuss regarding this matter. Should the F&F calculation be based on 100% of the salary or on the current reduced pay? As in August, we are once again reducing it due to the lack of orders on hand to manage. Please assist me with this issue.

Your help is greatly appreciated.

Thank you.

Whatever remuneration you have offered in the appointment letter, the same remuneration applies to their F&F settlement upon termination.

Dear Ramananand-Shangunni,

I have a different answer for you. There are two types of employees: workmen under the ID Act and non-workmen under the ID Act.

In the case of workmen under the ID Act, you cannot reduce the wages/salary without following the due process under section 9A. For non-workmen under the ID Act, you can have an understanding or agreement in given conditions regarding the reduction of wages/salary and settling the final dues accordingly.

Dear Sirs,

Thank you so much for your valuable inputs. I will take it up accordingly.

Regards,
Ramananand

I also endorse the views with respect to F & F on the pretext of separation, a deemed resignation in this case. Please let me know, in proceeding on this line, whether you are keeping the other door open, i.e., will you take him/her back once normalcy is restored and back to past performance levels? Are you in a position to send him off with an assurance, in case he/she does not get engaged elsewhere and seeks your nod to rejoin?

Dear friend, what's expected of you at this juncture is a humane approach for an unprecedented/unwanted action. After all, this termination didn't emanate from any indiscipline committed by the employee. Please pay him in full, including 2 months' salary, so that he is left to fend for himself in the interim. I hope no one is going to get any legal remedy at the soonest desired. Hence, this is a win-win bargain.

Dear Sir,

Thank you so much for the advice. We would definitely like to take them back if the situation improves. In fact, I would also help them in finding a job in another organization as and when I find any vacancies. This has been communicated to them. I do want to have a win-win situation as you have said.

Regards,
Ramananand

Appreciate your gesture, R'anandji.