How Can We Legally and Fairly Handle Employees Leaving Without Notice? Seeking Expert Advice on Our Bonus Policy

Hi, we have a persistent issue at hand. We have a policy of a 2-month notice period, but there are employees who leave abruptly. They are the kinds for whom relieving documents don't matter. However, in this situation, work suffers, and they don't care to return the salary in lieu as well as the salary paid to them during the lockdown (we couldn't set up work from home). Getting into legalities shall be a long process, and we don't have enough bandwidth to pursue legal action.

We have formulated a bonus policy, hence, and we need an opinion from experts here if it is legal and fair for the employees.

Salary per month structure

Salary (with all allowances) - Rs. 10,000/- (in hand)

Staff Bonus - Rs. 2000/- (will be handed over at the completion of 1 year from the permanent appointment, and every consecutive year of completion of service thereon)

Employer's Bonus - Rs. 2000/- (will be accumulated every month with the employer and will be issued on the successful completion of the notice period at the time of exit)

Professional Tax - Rs. 200 (borne by the employer)

Total CTC - Rs. 14,000/- per month

Our firm is not eligible for EPF / ESIC at the moment. Please revert with your views and suggestions. Thank you.

Location: Kolkata, India
Tags: City-India-Kolkata, Country-India, notice period, salary in lieu, work from home, legal action, retention bonus, notice period issues, bonus policy

The situation you are facing with employees leaving abruptly can indeed be challenging for the organization. Regarding the formulated bonus policy, let's assess its legality and fairness:

[B][B]Legality and Fairness Assessment

- The Staff Bonus: This component seems fair as it rewards employees for their loyalty and long-term commitment by providing a bonus after completing each year of service.

- The Employer's Bonus: Accumulating a bonus to be issued upon successful completion of the notice period at the time of exit can act as a retention mechanism. Legally, such a policy can be implemented provided it is clearly communicated to all employees and written in the employment contracts.

- Professional Tax: It's commendable that the employer bears the professional tax, which is a standard practice in many organizations.

[B][B]Suggestions for Implementation

1. Communicate Clearly: Ensure that this bonus policy is clearly communicated to all employees at the time of hiring and included in their employment contracts.

2. Document Policies: Have a detailed policy document outlining the terms and conditions of the bonuses, including eligibility criteria and payment timelines.

3. Legal Review: It's advisable to have a legal expert review the bonus policy to ensure compliance with labor laws in Kolkata, India.

4. Consistency: Apply the bonus policy consistently across all employees to avoid any perception of bias or unfair treatment.

5. Address Absconding Cases: For employees who leave abruptly, consider legal consultation on recovery options or explore alternative measures to mitigate financial losses.

Implementing a well-structured bonus policy can serve as an effective retention tool and incentivize employees to stay committed to the organization.

https://www.labour.gov.in/ - Official website for labor laws in India.