Termination due to financial crisis in the company or base it on employee performance?

My friend wants to terminate her employee on the basis of financial loss of the company her employee is not performing well since 2020.
Please suggest me better option for the termination
1) Performance basis
2) Financial loss
company is facing loss during covid 19 (lockdown)

Dear [Login to view],

If the employee has not been performing to the desired level since 2020, then have you given him any written warning?

Nevertheless, before the issue of the warning letter, have you issued him with the target to be achieved and in what span of time? When did such communication take place and how did it take place?

Have the causes of the underperformance been studied? To meet the target, does the employee need to depend on the tools, machines, instruments, computer etc., and if so, then are these in working conditions?

If the employee is underperforming, then what support has his/her reporting manager given to the employee? Is the manager taking underperformance nonchalantly?

There are so many questions associated with underperformance. The general tendency is to pin blame on the employee and check him/her out. You may remove the employee, but ensure that he/she does not meet injustice.

Your query was on exercising the choice between removal on account of underperformance and financial distress. The choice remains yours. However, make sure that the LIFO principle is followed if you wish to remove the services of an employee because of the financial poor condition of the company.

Thanks,

Dinesh Divekar

Dear Colleague,

I don't believe this forum is truly meant for advice on how to terminate services which in industrial parlance is tantamount to " capital punishment" .

If you want to separate any employee, the win win approach is to ask him to tender his/ her resignation,pay notice pay and let him go in good taste.

By asking the relevant questions by a senior colleague, he has aptly pointed at possible wrongs on both sides and that route of termination is fraught with legal tangles.

If necessary , pay him some lump-sum compensation holding a carrot . This is to ensure preempting legal hurdles and also his separation by obtaining resignation on record is made to appear without any blot on his part.

Regards,
Vinayak Nagarkar
HR and Employee Relations Consultant

Dear,

As you want to know which way to remove a employee ,for this Mr Dinesh and Mr.Vinayak explain very well way.
you can not terminate an employee on ground of financial problem,You can retrench him with proper compensation.
His under performance is well discussed by Mr Dinesh.

Thanks
S.Kumar

Dear Friend,

It is difficult to believe your pleas, because entire 2020 passed amidst shutdown and lockdown and further the financial loss crop up due to one person is some kind of joke.

The termination at this point of time is not less than a sin, by this a family would be destabilized completely. In my view, you discuss with the boss of the employee to give some time to perform as per expectation. If things are not settled, you can terminate as per the termination ground mentioned in appointment letter ( either ask him to resign or pay notice pay). The rest is left to your wisdom.