Hi VV,
I think you have no choice; you have to go by your rule book. There's no point at this stage to consider ethics per se. You, as an HR professional, will have your task cut out. Otherwise, your corporate governance will fail. What's your policy? He joined, then raised so many of his demands. By all means, he's your regular employee; whether he likes it or not is secondary. Wherever possible within your restrictions, you can accommodate if you really don't want to lose him. Is relaxing bonding within your delegated powers and giving an enhanced salary an option? Is he a crucial candidate? You got No. 2 in the panel, right? Why should you worry? Escalate the matter, take a legal opinion, and leave it to your bosses to decide or organize a meeting with your boss and him. Await what transpires there for the present. Probably, he has another offer on hand which might have looked like a better option. That may be a reason for his standoff with you.
From India, Bangalore
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1158I think you have no choice; you have to go by your rule book. There's no point at this stage to consider ethics per se. You, as an HR professional, will have your task cut out. Otherwise, your corporate governance will fail. What's your policy? He joined, then raised so many of his demands. By all means, he's your regular employee; whether he likes it or not is secondary. Wherever possible within your restrictions, you can accommodate if you really don't want to lose him. Is relaxing bonding within your delegated powers and giving an enhanced salary an option? Is he a crucial candidate? You got No. 2 in the panel, right? Why should you worry? Escalate the matter, take a legal opinion, and leave it to your bosses to decide or organize a meeting with your boss and him. Await what transpires there for the present. Probably, he has another offer on hand which might have looked like a better option. That may be a reason for his standoff with you.
From India, Bangalore
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Hi,
It is hardly a week's time stint. Why do you want to enforce the terms and conditions of the bond/training agreement?
Was any software skills/concept training imparted to the candidate within a week's time?
There is no loss involved except the 90-day waiting period.
You should be happy that the employee communicated his unwillingness within a week's time.
So, there is no point in harassing the employee by quoting the terms and conditions of the bond. Even if you proceed legally, you will be expected to prove how it will result in a loss for you as the employer. You will also be expected to substantiate the volume of training imparted.
As the proverb says, "You can lead a horse to water, but you can't make him drink," which means that you can give someone an opportunity but not force them to take it. Considering the short stint, I suggest you let him go and close his file. You may mark his profile in the 'not to hire' list.
From India, Madras
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It is hardly a week's time stint. Why do you want to enforce the terms and conditions of the bond/training agreement?
Was any software skills/concept training imparted to the candidate within a week's time?
There is no loss involved except the 90-day waiting period.
You should be happy that the employee communicated his unwillingness within a week's time.
So, there is no point in harassing the employee by quoting the terms and conditions of the bond. Even if you proceed legally, you will be expected to prove how it will result in a loss for you as the employer. You will also be expected to substantiate the volume of training imparted.
As the proverb says, "You can lead a horse to water, but you can't make him drink," which means that you can give someone an opportunity but not force them to take it. Considering the short stint, I suggest you let him go and close his file. You may mark his profile in the 'not to hire' list.
From India, Madras
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Hi,
In the case of a bond as well, you cannot stop an employee from leaving your organization based on the following aspects:
1. Have you legally enforced a bond? This can be seen as coercion, where you, as an employer, set a condition prior to joining that the bond is compulsory. If the employee does not sign the bond, he will not get the job. If the employee wishes to switch for growth or a higher salary, he may accept the bond condition. However, legally, this could be viewed as a forced agreement since it is one-sided in favor of the employer, and the employee has no option but to sign it.
2. If you are binding an employee for a specified period, for example, a 2-year bond, are you providing training to that employee in return? If not, the bond may not be enforceable. If yes, you can claim the training cost from the employee if he leaves early.
3. Bonds usually have a specified fee to be recovered from the employee if he leaves early. You can recover that amount. However, if you set an unreasonably high amount that the employee refuses to pay, you can go to court, where the amount may be reduced, and a settlement reached. The enforceability of your bond may also be questioned.
Overall, a bond is often used to instill fear in employees so that they do not leave early. However, if an employee is well-informed, they may still sign the bond even if they know the terms are illegal and unenforceable.
From India, New+Delhi
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In the case of a bond as well, you cannot stop an employee from leaving your organization based on the following aspects:
1. Have you legally enforced a bond? This can be seen as coercion, where you, as an employer, set a condition prior to joining that the bond is compulsory. If the employee does not sign the bond, he will not get the job. If the employee wishes to switch for growth or a higher salary, he may accept the bond condition. However, legally, this could be viewed as a forced agreement since it is one-sided in favor of the employer, and the employee has no option but to sign it.
2. If you are binding an employee for a specified period, for example, a 2-year bond, are you providing training to that employee in return? If not, the bond may not be enforceable. If yes, you can claim the training cost from the employee if he leaves early.
3. Bonds usually have a specified fee to be recovered from the employee if he leaves early. You can recover that amount. However, if you set an unreasonably high amount that the employee refuses to pay, you can go to court, where the amount may be reduced, and a settlement reached. The enforceability of your bond may also be questioned.
Overall, a bond is often used to instill fear in employees so that they do not leave early. However, if an employee is well-informed, they may still sign the bond even if they know the terms are illegal and unenforceable.
From India, New+Delhi
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Dear Vasavi,
First question to you from my side is, why should you have an employment bond with employees if everything is going well and planned smoothly? If something is going wrong or missing in your organization in terms of work culture, opportunities for growth and learning, respect for employees, company growth, and management, then you should consider having employment agreements with newcomers.
So, first, you should examine and evaluate the work culture to ensure we are on the right track. What steps should we take to bring about improvements in the organization to reduce employee turnover and foster a culture where employees stay with the company for an extended period?
All these aspects are crucial for any company.
From India, Surat
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First question to you from my side is, why should you have an employment bond with employees if everything is going well and planned smoothly? If something is going wrong or missing in your organization in terms of work culture, opportunities for growth and learning, respect for employees, company growth, and management, then you should consider having employment agreements with newcomers.
So, first, you should examine and evaluate the work culture to ensure we are on the right track. What steps should we take to bring about improvements in the organization to reduce employee turnover and foster a culture where employees stay with the company for an extended period?
All these aspects are crucial for any company.
From India, Surat
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Dear Vasavi,
The first question from my side is: why should you implement an employment bond with an employee if everything is going well and according to plan? If there are issues present such as a lack of proper work culture, limited growth opportunities, insufficient learning prospects, lack of respect for employees, stagnant company growth, or ineffective management, then it may be necessary to introduce employment agreements with new hires.
Therefore, the initial step should involve examining and evaluating the work culture to ensure that we are heading in the right direction. What actions can be taken to enhance the organization, reduce employee turnover, and foster a culture where employees choose to remain with the company for an extended period? All these factors are crucial for any company.
Thank you.
From India, Surat
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The first question from my side is: why should you implement an employment bond with an employee if everything is going well and according to plan? If there are issues present such as a lack of proper work culture, limited growth opportunities, insufficient learning prospects, lack of respect for employees, stagnant company growth, or ineffective management, then it may be necessary to introduce employment agreements with new hires.
Therefore, the initial step should involve examining and evaluating the work culture to ensure that we are heading in the right direction. What actions can be taken to enhance the organization, reduce employee turnover, and foster a culture where employees choose to remain with the company for an extended period? All these factors are crucial for any company.
Thank you.
From India, Surat
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All pharma companies are notorious for settling issues such as salary, expenses, leave encashment, and more, except for a few multinationals. I have been fighting in labor court for the last 10 years as an employee of Alembic Pharmaceuticals Ltd. and have been successful in holding them accountable. For more details, you can send an email or contact me on my mobile at 9451544804.
From India, Kanpur
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From India, Kanpur
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Hi Vasavi,
I understand and would agree with your concern. I'm an HR professional at an e-commerce company in Coimbatore. Before I started consulting here, the Founder also faced the same issue of people just leaving abruptly. And people will come anytime they want and ask for a salary for the days they have worked.
So, I've imposed certain policies after employees agreed:
1) 10% of the salary every month will be held as a security deposit. It will be released after they end their employment with the company only after assessing their performance and behaviour. If any issues, they will be deducted from that 10%.
2) A clear NDA is asked to sign stating certain clauses of penalty. All the penalties and clauses are explained to every employee by me. Everyone has signed on to it. The penalty is like:
a) if they want to stop employment immediately without any prior notice. The entire salary will be held by the company. No salary will be released.
b) if they want to stop employment immediately with prior notice. 7 days' salary will be held. The same implies in terms of bad organizational behavior.
c) If the company terminates any employee, the company can either hold the entire salary or 7 days' salary based on the issue.
d) After signing the NDA, they or anyone from the family or friends cannot dispute over salary.
Every point in the NDA is clearly explained to every employee and duly signed. This has brought great discipline and helped the company to solve issues like this.
Thanks,
Gauri
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I understand and would agree with your concern. I'm an HR professional at an e-commerce company in Coimbatore. Before I started consulting here, the Founder also faced the same issue of people just leaving abruptly. And people will come anytime they want and ask for a salary for the days they have worked.
So, I've imposed certain policies after employees agreed:
1) 10% of the salary every month will be held as a security deposit. It will be released after they end their employment with the company only after assessing their performance and behaviour. If any issues, they will be deducted from that 10%.
2) A clear NDA is asked to sign stating certain clauses of penalty. All the penalties and clauses are explained to every employee by me. Everyone has signed on to it. The penalty is like:
a) if they want to stop employment immediately without any prior notice. The entire salary will be held by the company. No salary will be released.
b) if they want to stop employment immediately with prior notice. 7 days' salary will be held. The same implies in terms of bad organizational behavior.
c) If the company terminates any employee, the company can either hold the entire salary or 7 days' salary based on the issue.
d) After signing the NDA, they or anyone from the family or friends cannot dispute over salary.
Every point in the NDA is clearly explained to every employee and duly signed. This has brought great discipline and helped the company to solve issues like this.
Thanks,
Gauri
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Hi,
"1) 10% of the salary every month will be held as a security deposit. It will be released after they end their employment with the company only after assessing their performance and behavior. If any issues, they will be deducted from that 10%."
Not a right practice and purely against the law.
As per the Payment of Wages Act, only certain permissible deductions are allowed (Refer Section 7 of the Payment of Wages Act).
Added to the above, you claim that 10% of withheld salary will be released to the employee at the end of the employment term only after assessing their performance and behavior. This does not make sense at all. If an employee is having performance and behavior issues, why are they allowed to continue? Whether any interest amount will be paid for the amount deducted from the salary. If the employee works for a considerable number of years, the employer is supposed to release a huge amount. Will it not be a burden to the employer?
While your intention to safeguard the interest of the employer is right, the method followed is not right.
As an alternative, you may introduce a Retention Bonus Policy. Make all employees eligible for some amount on a monthly basis (the amount will be separate and out of the monthly gross/CTC salary). Let that amount accumulate on a monthly basis. Fix some criteria that the said amount will be released only if the employee completes this many years. This is legal as this amount will not be part of the employee's salary.
From India, Madras
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"1) 10% of the salary every month will be held as a security deposit. It will be released after they end their employment with the company only after assessing their performance and behavior. If any issues, they will be deducted from that 10%."
Not a right practice and purely against the law.
As per the Payment of Wages Act, only certain permissible deductions are allowed (Refer Section 7 of the Payment of Wages Act).
Added to the above, you claim that 10% of withheld salary will be released to the employee at the end of the employment term only after assessing their performance and behavior. This does not make sense at all. If an employee is having performance and behavior issues, why are they allowed to continue? Whether any interest amount will be paid for the amount deducted from the salary. If the employee works for a considerable number of years, the employer is supposed to release a huge amount. Will it not be a burden to the employer?
While your intention to safeguard the interest of the employer is right, the method followed is not right.
As an alternative, you may introduce a Retention Bonus Policy. Make all employees eligible for some amount on a monthly basis (the amount will be separate and out of the monthly gross/CTC salary). Let that amount accumulate on a monthly basis. Fix some criteria that the said amount will be released only if the employee completes this many years. This is legal as this amount will not be part of the employee's salary.
From India, Madras
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Thank you. Will amend
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Dear Ms. Gauri,
Do you know what an NDA is? Please ask your lawyers to explain it to you.
The NDA is invalid on many counts, one of which is illegal deductions violating the Payment of Wages Act.
Secondly, under all labor laws, you cannot refuse to pay the salary. At best, you can deduct the notice period salary. You can face serious legal consequences. And yes, there are NGOs just waiting to get such juicy cases, and they have funds to fight you.
Besides, most good employees will laugh and walk off during the interview. You will be getting the more pathetic ones who can't get employed elsewhere.
From India, Mumbai
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Do you know what an NDA is? Please ask your lawyers to explain it to you.
The NDA is invalid on many counts, one of which is illegal deductions violating the Payment of Wages Act.
Secondly, under all labor laws, you cannot refuse to pay the salary. At best, you can deduct the notice period salary. You can face serious legal consequences. And yes, there are NGOs just waiting to get such juicy cases, and they have funds to fight you.
Besides, most good employees will laugh and walk off during the interview. You will be getting the more pathetic ones who can't get employed elsewhere.
From India, Mumbai
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