What is the procedure of employee termination in India?


What is the procedure of employee termination in India?
What are there specific clauses to be considered against or behalf of the employee?

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Hi Anushree,

The question is quite wider :grinning: to answer.

Yet, I make an attempt to narrow it down.

  1. Note the work location of the employee;
  2. Identify whether the person falls under the definition of an Employee or Workmen (at times we presume some as employees but their functions will be to that of workmen);
  3. This identification helps you to decide which laws you have to refer to. E.g. if it is workmen you will refer to the Industrial Disputes Act, if it is an employee, you will refer to the Shops and Establishments Act;
  4. Refer to the employment terms and conditions signed under the employment contract/letter of appointment/relating documents, company policy regarding the termination grounds (company might have listed the grounds/reasons that can be invoked for termination);
  5. Refer to the respective Acts and Rules to make sure the grounds/reasons that are invoked are not arbitrary (this will mitigate the risk of such an employee challenging the termination).
  6. Make sure before the termination, the applicable procedures, processes such as discussions, warning letters, show cause notices, hearing, the employee is given an opportunity to defend are followed. Generally the law prescribes certain rules to be followed by an employer to invoke termination of the employee. If the law is silent, it is deemed that the employer has to apply the ‘principles of natural justice’ i.e., the employee should be heard (i.e. given a reasonable chance to know the reasons and defend his/her side) and as far as it is practically possible the investigating officer/personnel should not be the one who has direct interests on such termination, means the immediate boss of such employee cannot be the person to decide. Hence we have the HR department to moderate and resolve the issues.

Hope the above helps.

Bhuvana Anand

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