Termination of Employment

The employment relationship of an employee ends at this point. Redundancy, resignation, and other actions are all acceptable ways to accomplish this. Part IX of the Employment Rights Act, which was created by the government, lays forth the rights regarding termination of employment. As a result, a contract termination by an employer is legal.

What is the Meaning of Employee Termination?

Employee termination, put simply, is the end of a person's employment relationship with a specific business or organization. After being fired, an employee is no longer connected to the organization in terms of their employment, job, or income. It is possible for an employee to be let go voluntarily or involuntarily. A non-voluntary termination occurs when an employee's work or services are terminated against their will by their employer.

A voluntary termination occurs when an employee resigns of their own free will. Companies must have a set policy and method for terminating employees. These procedures must adhere to the federal and state laws and regulations under which the corporation or organization was founded. Together with additional formalities, these procedures could involve a formal letter of termination.

What Kinds of Employment May Be Terminated?

There are several different sorts of terminations that fall under the two categories of termination listed below −

Voluntary Termination

A termination that is voluntary in nature occurs when an employee chooses to part ways with a business or organization. This could be for a number of reasons, such as having a better employment opportunity, leaving the industry, starting his or her own business, having personal or professional reasons, etc. In order to leave a job voluntarily, the individual must give the employer a proper resignation letter. While the typical notice period is 30 days, the organization and the employee contract may allow for a greater or shorter length of time.

Involuntary Termination

An employee who is fired involuntarily, as the name implies, leaves a company against their will or agreement. When cutting staff, making layoffs, terminating employees for misconduct, etc., a company or organization may choose an involuntary termination.

Downsizing and Layoffs

Layoffs or downsizing occur when a corporation reduces its personnel. Downsizing frequently occurs when businesses run out of money, desire to cut expenses, or combine. Moreover, layoffs occur when an employee's skill set is no longer needed or helpful by the organization.

Illegal Dismissals

Recruiting and letting go of employees inside a company are entirely up to the employer. Yet, if there isn't a good enough reason, the employer can't fire the worker. Caste, ethnicity, gender, and other factors are prohibited grounds for dismissal in many nations. Firing an employee who has taken maternity leave, has been absent, or has reported misbehavior in the workplace is likewise prohibited. When a business is found to have fired or terminated an employee in violation of the law, it must pay the person in question compensation and either reinstate them in their previous position or offer them a position that is reasonably comparable. If proven responsible for any unjust or illegal terminations or dismissals, businesses and organizations may also face sanctions.

Firing due to Misconduct

As a result of misconduct, poor work performance, or because their actions provoked a commotion at work, employees may also lose their jobs. A 30-day notice period has frequently been overlooked when an employee is let go from their position due to misconduct. Employees who are let go because they disobeyed business rules, however, ought to be given the opportunity to defend themselves. A show cause notice must be served to the disloyal employee, who will then have a reasonable opportunity to present a defense. The corporation will also form and hold meetings of a disciplinary panel during such disciplinary processes. Efforts must be made to ensure fairness throughout the process. The outcome of these disciplinary hearings may occasionally be used as evidence to support the employee's ad hoc termination without cause or notice.

Contractual Termination

The contract that the employee signs with the employer when he or she is provided with the contract may also contain specified and predetermined terms for termination. For instance, advisors, interns, and consultants might be employed for particular projects and for particular lengths of time only, and their employment might be terminated at the conclusion of their terms. Contracts could, however, be renewed or extended.

What Grounds are there for Dismissal in India?

As previously mentioned, there are a number of reasons why an employee could be fired. The following reasons for terminating a job are acceptable in India −

• After a fixed-term agreement expires,

• An employee's resignation

• The time when a worker reaches retirement or superannuation age owing to layoffs

• Termination for a certain "reason," such as but not limited to

• Violation of an employment agreement or company policies

• In the event that a worker has broken the law

• If a worker is unable to do their duties

• Committing a crime as an employee

• Even with many opportunities or promises made by the individual, if there has been a performance gap or low performance

• If a manager stops having faith in a worker

• If there is persistent, irrational absence from work, etc.

Medical Termination of Employment

If a worker needs time off to heal from an illness or injury, you might have to think about firing them.

For employees who are ill, there are restrictions that govern how long they can work. Only one of the following five scenarios will allow you to fairly fire an employee.

• Misconduct

• Redundancy

• Illegality

• Capability

• Other substantial reasons

Depending on their abilities, employers may dismiss employees who become ill. Be sure the worker's inability to fulfill tasks is the real reason for the dismissal, not some other excuse.

Indian Laws Regarding Employment Termination

Since labor law in India is a concurrent topic under the Constitution, there are a number of labor and employment laws that are governed by both the States and the Center. The Industrial Employment (Standing Orders) Act of 1946 and the Industrial Disputes Act (IDA), both passed in 1947, are the principal federal statutes governing employment termination.

Workers who do not have management or administrative positions are covered by the Industrial Disputes Act of 1947. It specifies that any employee who has worked for a company for more than a year may only be fired with the consent of the appropriate government agency. Additionally, an employer is required to give a good reason for dismissing the employee and to pay a severance payment equal to fifteen days' worth of the person's average annual wage.

Conclusion

While upholding corporate decorum and preserving order is crucial, and certain difficult decisions are unavoidable to ensure the business' existence, it's important to remember that employees are not simply instruments to be discarded after their value has diminished.

An employee somewhat owns "that" post for which he has been tirelessly working for many years, just like a farmer buys land after cultivating it for a number of years. As a result, it is best to consider all retention, transfer, and other options before abruptly firing somebody. As their primary source of income, employment is essential.

Frequently Asked Questions

Q1. What do you mean by turnover?

Ans. Turnover in human resources refers to the process of replacing an employee with a new hire. Termination, retirement, demise, interagency transfers, and resignations are just a few examples of how organizations and employees may part ways. The turnover rate of an organization is its turnover rate expressed as a percentage.

Q2. What is Pink Slip?

Ans. The phrase "pink slip" refers to the American practice of human resources departments informing employees of their involuntary termination of employment or layoff by placing a discharge notice in their pay envelope.

Q3. What is Layoff?

Ans. When a worker is laid off, it signifies that they are temporarily without a job because of a shortage of supplies, raw materials, or equipment, or even because of a natural disaster. For the aforementioned reasons, the employer is unable to assign tasks to the employees.