Handling Employee Requests for Compensation After Termination Without Notice: What Are Your Options?

As stated in the joining kit, the company retains the right to terminate employment during the probationary period without notice for reasons related to non-performance, misconduct, or indiscipline. What should we do if, after that, an employee asks for 14 days' salary as compensation because we terminated him from the company without notice?

Termination During Probation

If you have terminated an employee on the grounds of misconduct or non-performance, and this is stated in the termination letter as the reason, then that termination can be challenged because it is a stigmatic termination. Before initiating such an action, the concerned employee should have been given an opportunity to be heard.

It is acceptable that during probation, you can terminate an employee without notice and without assigning any reason. However, if you provide a reason for termination, then the employee should be given an opportunity to respond; otherwise, the termination would become stigmatic, which is not accepted.

An employee who has not completed 240 days of work over a period of 12 months cannot demand any compensation. Therefore, his claim of 14 days (normally it is 15 days' salary) as compensation is not maintainable. You can ask him on what grounds he is requesting 14 days' salary as compensation.

Could you please review the clause regarding the notice period for employees under the terms of appointment? Specifically, check if your company has a provision stating that any employee serving their probation must submit a resignation with a required notice period, such as 14 days. If such a clause exists, you are required to inform the employee at least 14 days (or the stipulated period) in advance before requesting their resignation or asking them to leave the organization.

Additionally, it is recommended to avoid terminating the employee's service abruptly. Instead, request their resignation and, in cases where they were not informed in advance, compensate them with 14 days' pay.

Dear friend,

There may be a 'clause' in your appointment order issued to the terminated employee stating that employment can be terminated without notice. However, there is a fundamental right for an employee that requires a certain procedure to be followed before such an action. Even an underperforming employee who is on probation (with no mention of the probation duration or how many months he served) should be issued an advisory and given an opportunity to improve his performance over a specific period, say a month or two. Was any formal training or hands-on experience required? There is still an option to extend his probation period beyond the originally stipulated timeframe. Without following these precautionary measures, abruptly terminating him is not fair. The concerned party may not even know why he is being terminated if he is kept in the dark. He might believe he has performed well within his knowledge and experience. What if you demanded or expected more than what he was recruited for? It's possible. I feel a properly structured administration should adhere to certain measures and 'fair labor practices' before resorting to such actions. Generally, compensation is computed at 15 days of salary for every year of service rendered. If he has not completed one year, it becomes difficult. However, if he has completed one year, even under probation, he deserves 15 days' salary and a formal notice. Some establishments follow a 'no harm' attitude by simply asking him to resign, allowing him to be relieved without a 'remark'. These are my thoughts if he is not being terminated due to 'misconduct', if any. That would be a different situation.

Hi, during the period of probation, the management can terminate the services of a probationer at any time without assigning any reason or without giving any notice, provided that clause is available in the appointment letter. However, if you terminate a probationer for any act of misconduct, then it is strongly advisable to hold an enquiry as per the certified standing orders or the model standing orders, as the case may be, since there is a stigma attached to that action.

If a probationer is relieved on completion of the probation period, then absolutely there is no issue, and it will not be construed as retrenchment or termination. To conclude, services of a probationer can be terminated at any time by invoking the appropriate clause in the appointment letter, and there is no need to pay any compensation or salary for that as mentioned.

As I am from the real estate industry, here is a sales job completely based on sales and revenue targets. The employee did not achieve any sales, and despite being hired on a target basis, we paid him Rs 50,000/- as salary in September. However, in that month, he did not perform well, so we terminated him.

After receiving the termination email citing non-performance and indiscipline (not following the company's reporting policy), he is requesting 14 days' compensation and his October month's salary. He is also harassing me by posting on my LinkedIn and Instagram accounts regarding his full and final settlement.