Hello Everyone - Would either of you be aware of the application of "Constructive Dismissal " under Indian laws.
For example - While a company may have a severance clause as per the contract which under circumstances of where an employee tenders his resignation, the severance terms become unapplicable.
What would the employees recourse be if such a situation is created (significant changes in the org structure, downsizing of role etc - NOT performance based) can this be deemed as Constructive Dismissal under Indian law, whereby an environment is being created that forces the employee to resign from his/her services?
From India, Mumbai
For example - While a company may have a severance clause as per the contract which under circumstances of where an employee tenders his resignation, the severance terms become unapplicable.
What would the employees recourse be if such a situation is created (significant changes in the org structure, downsizing of role etc - NOT performance based) can this be deemed as Constructive Dismissal under Indian law, whereby an environment is being created that forces the employee to resign from his/her services?
From India, Mumbai
I read it as 'constructive discharge' and not constructive "dismissal".
The Industrial Disputes Act has provisions relating to such discharge/ retrenchment of employees. But only thing is that before doing so the employer should inform the government of his intention of retrenching the employees as measure of down sizing due to lack of work order. In case the employer has a work force of more than 100 employees, prior approval from the government shall be obtained for such retrenchment. Certainly, the permission to retrench service shall be granted if the government is satisfied of the reasons stated by the employer and if the government also thinks that downsizing the workforce will help the employer to carry on his venture which will otherwise lead to a lock out.
Under any circumstance, the employer is liable to pay retrenchment compensation to the employees so retrenched which will be equal to 15 days salary for every year of service. In addition, the employee shall be served notice of retrenchment so that they can find alternative employment. Otherwise, pay equivalent to days of notice shall be paid.
In case employer go for retrenchment, it should also be ensured that the employee who joined the company last should be the first to be retrenched.
When the above provisions are available for the employer, why should he demand resignation from the employees who are unwanted as per his list. If he does so, certainly, his act will be termed as 'unfair' practice.
Regards,
Madhu.T.K
From India, Kannur
4250The Industrial Disputes Act has provisions relating to such discharge/ retrenchment of employees. But only thing is that before doing so the employer should inform the government of his intention of retrenching the employees as measure of down sizing due to lack of work order. In case the employer has a work force of more than 100 employees, prior approval from the government shall be obtained for such retrenchment. Certainly, the permission to retrench service shall be granted if the government is satisfied of the reasons stated by the employer and if the government also thinks that downsizing the workforce will help the employer to carry on his venture which will otherwise lead to a lock out.
Under any circumstance, the employer is liable to pay retrenchment compensation to the employees so retrenched which will be equal to 15 days salary for every year of service. In addition, the employee shall be served notice of retrenchment so that they can find alternative employment. Otherwise, pay equivalent to days of notice shall be paid.
In case employer go for retrenchment, it should also be ensured that the employee who joined the company last should be the first to be retrenched.
When the above provisions are available for the employer, why should he demand resignation from the employees who are unwanted as per his list. If he does so, certainly, his act will be termed as 'unfair' practice.
Regards,
Madhu.T.K
From India, Kannur
Community Support and Knowledge-base on business, career and organisational prospects and issues - Register and Log In to CiteHR and post your query, download formats and be part of a fostered community of professionals.
Constructive Discipline Policy.pdf
1.12.09 dismissal 13.02.08 appeal.doc