Forced Resignation Dilemma: Should the Company Pay Two Months' Salary?

The employer asked the employee to resign. The grounds were that the employee didn’t perform well. The employer did not want to terminate as the company's face value would be hampered. So the company asked the employee to resign. The employee resigned, and within one week, the company said it's your last day. Now the employee is asking the company for two months' salary. If the company does not pay, then it will be considered forced resignation, the employee says. Can you advise me from the company's point of view here? I want to save the company.

Dear Priyal,

If the employee does not perform well, then why should the employee not be terminated? How termination reduces the brand value of the company is not understood.

Nevertheless, the via media is to ask the employee to resign. Your company did that. But then what was the problem in allowing him/her to complete his/her notice period? If the company did not wish the employee to complete the notice period, then it should have paid the salary in lieu of the notice period. Your company has done neither! By not honoring the conditions of the employment mentioned in the appointment letter, how the company will maintain its brand image is best understood by the promoters!

Your company wants to have its cake and eat it too! Better not to play such tricks. If the employee were to approach the labor court or civil court, will the litigation increase or decrease the face value?

If the employee did not perform well, then did your company order a domestic inquiry to prove the under-performance? Before termination, proving under-performance by conducting a domestic inquiry is mandated as per principles of natural justice. Did your company adhere to Article 25 of the Constitution of India?

It appears that your company has pushed itself into a predicament and wants to wriggle out of it. Sorry, the only legal option left is to honor the terms and conditions mentioned in the appointment letter.

Thanks,

Dinesh Divekar

Thank you for your time and consideration on this topic. Now that such a situation has arisen, could you please help me find solutions or any similar case laws related to it? As far as serving the notice period within one week of his resignation is concerned, they stated it was his last day and ended it there.

Can you reproduce the clause of separation mentioned in the appointment letter of the concerned employee to enable us to provide suitable advice?