Termination Notice

CS Shirish Bhootra
Feb 28, 2023
3 min read

Written by CS Shirish Bhootra

Termination: Meaning

If an employee or employer wants to end the employment relationship, it can be done by terminating the contract of service. It can be with or without notice or caused by employee misconduct.

Who can terminate a contract?

The termination of a contract of service can be filed either by the employer or by the employee. Situations that may lead to termination are as follows :

Employee resigns.
The employer dismisses the employee.
The contract tenure has expired.

Employees and employers must comply with the terms and conditions mentioned in the contract of service.

Resignation rejection

An employer cannot reject employees’ rejection. Employee possesses a right to resign at any time subject to service of required notice or payment of compensation rather than service of notice.

Disallowance by employers for leave of job by an employee is considered an offence.

Termination with notice

If the contract of service provides a notice period, then the employee must either serve notice or pay compensation instead of notice. However, the notice requirement may be waived subject to the mutual consent of the employee and employer.

A termination letter is mandatory, and termination notice must be either by the employer or the employee. It must be in writing. If the employee does not receive a termination letter from the employer, the employer has the right to ask the employer and have the same. Till the issuance of the termination notice, the employee is considered an employee of the company. If you did not receive a termination letter, ask your employer to give you one.

The termination letter must contain the signature of the employer to acknowledge receipt. It avoids disputes or misunderstandings between both.
The employer is not required to give a reason for termination as long as due notice has been provided.

Termination: Employee misconduct

Employee termination due to misconduct is a serious disciplinary action that requires careful consideration. A formal inquiry is to be conducted by the employer before initiation of such corrective action.

Misconduct is the failure to fulfill the conditions of employment in the contract of service. Examples include theft, dishonesty, disorderly or immoral conduct at work, and insubordination.

Suppose an employee has been accused of committing an act of misconduct. In that case, the employer should inform the employee and conduct an inquiry before deciding whether to dismiss the employee or take other forms of disciplinary action.

Employment Act provides that an employer may suspend the employer from work during the period of inquiry. Further also provides that the employee is entitled to have half salary during the suspension. The suspension period should be one week at maximum, for extension approval of prescribed authority is required.

If, after inquiry, no misconduct is found, then full payment of salary to the employee. If, after inquiry, misconduct is found, then the employer may downgrade the employee or terminate without notice or suspend the employee from work.

Wrongful dismissal

If the employee feels there has been wrongful dismissal by an employer, then the employee may file a claim with TADM.

Dismissal refers to a situation where the employer has terminated an employee’s contract of service. It may be either with or without notice or on account of either misconduct or no misconduct. It also includes situations where an employee involuntarily resigns.

Reasons for dismissal include misconduct, poor performance, and redundancy. Wrongful dismissal is when an employee has been dismissed without just or reasonable cause.

Wrongful dismissals include:

Dismissal on discriminatory grounds based on age, race, gender, religion, etc.
Dismissal to deprive an employee of benefits or entitlements.
Dismissal to punish an employee for exercising an employment right.

An employee may appeal to Minister for Manpower if the employee has been wrongfully dismissed due to age or there is a denial of re-employment. The employee must submit a dismissal claim at TADM within one month from the last date of employment.

Conclusion

Termination of employees is a business decision that must be exercised with utmost care and attention. It affects the labour retention rate as well as the productivity of the employees.

References

Ministry of Manpower, File a wrongful dismissal claim (MOM)