Dear all,
We are an IT services company in Karnataka. We would like to terminate the services of a manager (non-workmen) due to a change in the business plan or organizational restructuring. Her services would no longer be required due to the reorganization.
Could you please advise on the procedure to be followed and the compensation payable to this person upon termination?
Many thanks for your quick response.
Vijaya
From United Kingdom, London
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4We are an IT services company in Karnataka. We would like to terminate the services of a manager (non-workmen) due to a change in the business plan or organizational restructuring. Her services would no longer be required due to the reorganization.
Could you please advise on the procedure to be followed and the compensation payable to this person upon termination?
Many thanks for your quick response.
Vijaya
From United Kingdom, London
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Dear All, please can I have your advice ASAP? Regards Vijaya
From United Kingdom, London
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From United Kingdom, London
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Dear Vijaya,
How should the separation be addressed in the Appointment Letter? Is it three months' salary or the notice period pay as stated in the appointment letter that needs to be paid?
You need to communicate this to her both in writing and in person. Discuss a transition plan with her regarding her last working date and the exit process. Please plan the communication well in advance, as it may be difficult for her.
PF and other retirement benefits will be applicable based on her eligibility.
Offer her assistance with placement, either within your firm or with vendor firms.
Hope that helps!
From India, Mumbai
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How should the separation be addressed in the Appointment Letter? Is it three months' salary or the notice period pay as stated in the appointment letter that needs to be paid?
You need to communicate this to her both in writing and in person. Discuss a transition plan with her regarding her last working date and the exit process. Please plan the communication well in advance, as it may be difficult for her.
PF and other retirement benefits will be applicable based on her eligibility.
Offer her assistance with placement, either within your firm or with vendor firms.
Hope that helps!
From India, Mumbai
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Many thanks (Cite Contribution) for your time and advice. This is very helpful.
Her notice period is 3 months, and we would like the termination to be immediate, i.e., she need not come to the office from the next day as there are a couple of behavioral issues with this person that could affect the morale and motivation of others.
Please see below the clause in her appointment letter:
THE TERM
8.1 Your employment with the Company commenced on or before xx September 2006.
8.2 Unless previously terminated under the other provisions of this clause 8, your employment will continue until the expiry of written notice for not less than the appropriate period given by either you or by the Company to the other. The appropriate period of notice to be given by you or the Company will be detailed in your offer letter or otherwise notified to you in writing from time to time.
As per the terms and conditions of her service agreement/appointment letter, we need to provide 3 months' notice or pay in lieu.
Therefore, please advise if the following full and final settlement computation is okay:
1. salary for the number of days worked in the month
2. notice pay for 3 months covering the contract clause
3. pay for unused leave (basic salary)
4. gratuity as per the gratuity rules
We would like to offer the option of voluntary resignation in the first place, and in case she doesn't want to resign on her own, we will issue the termination letter informing her that we would like to discontinue her service as her position is no longer required owing to the change in business requirements/organization restructuring.
I hope we are going in the right direction and this person wouldn't challenge the above compensation that is being worked out.
Your views and suggestions would be appreciated.
Many thanks once again.
Regards,
Vijaya
From United Kingdom, London
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Her notice period is 3 months, and we would like the termination to be immediate, i.e., she need not come to the office from the next day as there are a couple of behavioral issues with this person that could affect the morale and motivation of others.
Please see below the clause in her appointment letter:
THE TERM
8.1 Your employment with the Company commenced on or before xx September 2006.
8.2 Unless previously terminated under the other provisions of this clause 8, your employment will continue until the expiry of written notice for not less than the appropriate period given by either you or by the Company to the other. The appropriate period of notice to be given by you or the Company will be detailed in your offer letter or otherwise notified to you in writing from time to time.
As per the terms and conditions of her service agreement/appointment letter, we need to provide 3 months' notice or pay in lieu.
Therefore, please advise if the following full and final settlement computation is okay:
1. salary for the number of days worked in the month
2. notice pay for 3 months covering the contract clause
3. pay for unused leave (basic salary)
4. gratuity as per the gratuity rules
We would like to offer the option of voluntary resignation in the first place, and in case she doesn't want to resign on her own, we will issue the termination letter informing her that we would like to discontinue her service as her position is no longer required owing to the change in business requirements/organization restructuring.
I hope we are going in the right direction and this person wouldn't challenge the above compensation that is being worked out.
Your views and suggestions would be appreciated.
Many thanks once again.
Regards,
Vijaya
From United Kingdom, London
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Managerial staff is not entitled for any compensation under ID Act.All depends on terms of appointment.Check the provisions of Shop and Commercial Estt: Act of your state also Varghese Mathew.
From India, Thiruvananthapuram
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From India, Thiruvananthapuram
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Dear Vijaya,
Unused leave is to be paid as you have granted leave to her i.e. when she remains on leave and no allowance is deducted.
From what I understand, no allowance (HRA, etc.) should be deducted, and the total salary should be divided by 26 to arrive at the average pay (in the case of PL/EL). This will prevent any potential underpayment if the termination is challenged later on. Sometimes, the court may send back the employee regarding this underpayment issue, and any subsequent payment will not rectify the order.
Thank you,
V K Gupta
From India, Panipat
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Unused leave is to be paid as you have granted leave to her i.e. when she remains on leave and no allowance is deducted.
From what I understand, no allowance (HRA, etc.) should be deducted, and the total salary should be divided by 26 to arrive at the average pay (in the case of PL/EL). This will prevent any potential underpayment if the termination is challenged later on. Sometimes, the court may send back the employee regarding this underpayment issue, and any subsequent payment will not rectify the order.
Thank you,
V K Gupta
From India, Panipat
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Dear Vijaya,
You have made it amply clear that; "we would like the termination to be immediate, i.e., she need not come to the office from the next day".
I have one query about what you have written: "We would like to offer the option of voluntary resignation in the first place, and in case she doesn't want to resign on her own, we will issue the termination letter informing her that we would like to discontinue her service as her position is no longer required owing to the change in business requirements/organization restructuring".
In case she goes for voluntary resignation, she will be doing it at your request/advice, and it will save the company from any further complications/claims in case of any dispute in the future. Right?
So in such a case where she puts in her resignation; would she still be entitled to and receive her 3 months' notice pay, and would you pay it?
Warm regards.
From India, Delhi
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You have made it amply clear that; "we would like the termination to be immediate, i.e., she need not come to the office from the next day".
I have one query about what you have written: "We would like to offer the option of voluntary resignation in the first place, and in case she doesn't want to resign on her own, we will issue the termination letter informing her that we would like to discontinue her service as her position is no longer required owing to the change in business requirements/organization restructuring".
In case she goes for voluntary resignation, she will be doing it at your request/advice, and it will save the company from any further complications/claims in case of any dispute in the future. Right?
So in such a case where she puts in her resignation; would she still be entitled to and receive her 3 months' notice pay, and would you pay it?
Warm regards.
From India, Delhi
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That’s right. Notice period is 3 months in her appointment letter and we will have to honour that. Regards Vijaya
From United Kingdom, London
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From United Kingdom, London
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Dear Vijaya,
Thanks for your response. I know many companies that coax their regular employees into resigning, only to later deny giving the notice pay despite having reached an understanding.
It is good that your company intends to honor their commitment and understanding with the employee.
Warm regards.
From India, Delhi
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Thanks for your response. I know many companies that coax their regular employees into resigning, only to later deny giving the notice pay despite having reached an understanding.
It is good that your company intends to honor their commitment and understanding with the employee.
Warm regards.
From India, Delhi
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Dear Vijaya,
Our members have already guided you on this subject. I would like to summarize the points mentioned above:
1. Provide a 3-month notice pay and the pending salary for the period worked.
2. Calculate and pay the Gratuity amount as the terminated person is eligible for it.
3. Pay the Leave encashment for any leave available in his/her credit.
Thank you.
From India, Kumbakonam
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Our members have already guided you on this subject. I would like to summarize the points mentioned above:
1. Provide a 3-month notice pay and the pending salary for the period worked.
2. Calculate and pay the Gratuity amount as the terminated person is eligible for it.
3. Pay the Leave encashment for any leave available in his/her credit.
Thank you.
From India, Kumbakonam
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SC - Compensation payable on date of accident 31.7.2012.pdf