Hello, I had been working for a Multinational Bank for last 2 year 3 months. Their employment offer says "Either party can terminate employment contract without assigning any reason with notice of 3 months or in-lue salary" After 12 of joining the firm I went on Maternity leave as per the company policy. I was not given any increment and Bonus that year bcos of my taking the maternity leave. Last 4 months my company was asking form all the employees in Banking division to resign from the jobs. After great perusal most of the team member including my Immediate BOSS resigned. On my confrontation reason they stated was that market recession and I'm not performing to which I opposed and clarified that Since last 15 months my appraisal process has not happened and there is no formal notification of my non- performance. Their pressure increased subjecting me to surrender and submit the resignation. I was on sick leave from Dec 9th - 12th 2008 when HR send me the termination letter dated 10th Dec 2008 vide Registered post at my house address under clause "Employment terminated without assigning any reason". This letter was delivered to my residence on 16th Dec 2008. I accepted the fate and though of departing in good terms. My last date of decided 31st Dec 2008 and for rest of the period they agreed to pay notice pay. To my surprised for my full and final payment they gave my notice pay only on Basic and HRA not on my CTC. I have other components which were designed to save tax like driver salary, medical , LTA etc. Even if I don't pay any bills my accrued money is made taxable and paid to my at end of the year deducting the applicable tax. Question: 1. Is my termination legal or illegal ? 2. I understand Indian Employment Law allows the company to terminate the employment without stating the reason only during retrenchment / bankcorrupcy etc ? 3. All employees of Banking division has resigned and I'm terminated . At last only 1 employee is left to head the Delhi Branch. They are looking for the replacement for all the employees resigned / terminated. This activity was done in order to restructure the org. So termination without assigning the reason valid ? 4. HR told they terminated my employment b'cos of my performance where as I have not been appraised since last 14 months and no official memo has been issues indicating my performance. Is this step justified by them ? 5. company has not deposited my salary till date and not releasing my salary on Annual Salary but on Basic and HRA leading to huge difference. Is it legal for them to do so ? 6. I understand in case company is terminating the employment other then any sever act done by me they are liable to pay me the gratuity for the year I have served ? Is my understanding correct ? 7. Am I eligible for PF during the notice period by employer ? Even they made my last working day as 31st Dec 2008 instead of 10th March 2008 ? 8. Termination notice starts from when a. When company write the termination letter and dispatches it? b. When the termination letter / correspondence reaches the employee ? In my case letter was dispatched on 10th Dec 2008 and reached my on 16th Dec 2008. Any company is calculating the termination from 10th Dec 2008. Is it right for them to do so specially when I was on sick leave? 9. What action can be taken against the company for mental harassment I have been going through? Please advice and help. regards, Renu Sharma
From India, Pune
From India, Pune
There are lot of issues to be answered in a single stretch. Let me start with legality of termination of employment. It is illegal to terminate an employee without any reason and without giving the employee an opportunity of being heard. If you have not been performing to the standards, that could have been a reason for termination. But the employer could have appraised your performance and given you an opportunity to improve. Since the employer has not taken any initiative to do so the act of employer terminating your service could be viewed as victimisation though the employer has every right of assessing the performance of employees. An arrangement to restructure the establishment is not a valid ground for mass retrenchment. It is like discount sale offer by shops in view of closure for renovation of shops. That will not be permitted at all. The employer has given you three months salary in lieu of three months notice. Salary for this purpose means Basic Pay and allowances (normally Dearness Allowance) and the company has given you basic salary + HRA. You can not ask for your CTC because the CTC includes all costs relevant to your employment and the expression CTC seldom finds any place in labour laws. You will not be eligible for gratuity since you have not completed the required years of service, ie, 5 years. However, whereas you have been terminated from service, you will be eligible for retrenchment compensation which is equal to 15 days salary for one year of service. Regarding EPF deduction, if the employees share is deducted from the notice pay offerred, the employer will also contribute. Otherwise, it is upto the employer to show cause to the EPF authorities the reasons for not deducting the contribution. The notice period starts on the date of receipt of communication. But since the employer has paid or has agreed to pay three months pay in lieu of notice, the date does not have any significance. Here the matter becomes illegal with respect to termination of service without valid reason. Since you have completed one year of service (which is decided on the basis of number of days work including the maternity leave days the absence for which will not be taken as days not worked) you should have been given retrenchment compensation as per Industrial Disputes Act. The payment in lieu of notice offered or given by the company is not questionable. There are recourses available to employees in Labour Acts such as Industrial Disputes Act, Payment of Wages Act etc. But before filing a complaint against the employer please ensure whether you come under the defenition of employee or not. Regards, Madhu.T.K
From India, Kannur
4250From India, Kannur
Dear Mr. Madhu, Thanks for the comments. One this is CTC for multinationals is different specifically for IT and Banking where say I was offered 10 Lakh p.a. ( also termed as Annual Salary) + ESOP for 1 Lakh so Total CTC is 11 Lakh. So I have the option to keep my Basic as 6 Lakh p.a. and HRA as 4 Lakh p.a. which will cost me high taxes. Another options are they also have tax saving components like medical, petrol bills, driver salary, professional development, Telephone reimbursements etc. which are not additional but to save tax I can reduce my Basic and HRA and start claiming amount under Reimbursement head (with bills to save the Tax or w/o bills with tax). FBT applies. Any how money is mine and doesnot come as any additional benefit to me. So ideally it should be given to be in fully and final settlement. Where as ESOP + Annual salary make my CTC and I'm not claiming ESOP value what I 'm claiming is my Annual Salary no matter under what components they have been broken to save taxes. Is my claim of annual salary justified now? Maternity was taken after completion of 1 year and as per the policy and leaves were duly granted and also availed the maternity expenses from company under plan. regards, Renu
From India, Pune
From India, Pune
Dear Renu, I understand your position. But whatever I suggested was on the ground of Labour Enactment in force. Though the provision relating to salary has been diluted finding that the wages of employees are increasing every year, the concept of employee from the angle of 'functional responsibility' is still there. As such you seem to be out of coverage of Labour Courts but you can file a civil suit for breach of contract. It is for you to prove and convince the court that the CTC offered is the salary. If you could do that it would be a verdict in favour of crores of managerial employees who have this pattern of pay scale. A scale of pay should be fixed. There can not be any adjustment 'for the purpose of tax', I believe. It should not be subject to change according to your option and tax burden. If so, it would be viewed as an attempt to evade tax. I believe that an employee is not suppose to declare a lower basic and higher tax exempted earnings. HRA, for instance, shall be subject to place of residence and rental value of residential accommodation. It should reflect at least a reasonable picture of house rent applicable in the area. These will be the apprehensions of the court while you put a claim. All the best. Madhu.T.K
From India, Kannur
From India, Kannur
Dear seniors,
I have recently joined a company as asst.manager HR its been only 45 days...now the management is terminating me because i have approached my CEO directly for the issue which is related to the company only.....The ED of the company told me to do so and now when said that it is said by the ED,,he is manipulation the things,,, and no one is giving me the specific reason and answer....They have terminated me without any notice also.
please tell me my rights and what are the actions which i can take against to the company or management.please revert me on my mail id
Regards
Khushbu
From India, Delhi
I have recently joined a company as asst.manager HR its been only 45 days...now the management is terminating me because i have approached my CEO directly for the issue which is related to the company only.....The ED of the company told me to do so and now when said that it is said by the ED,,he is manipulation the things,,, and no one is giving me the specific reason and answer....They have terminated me without any notice also.
please tell me my rights and what are the actions which i can take against to the company or management.please revert me on my mail id
Regards
Khushbu
From India, Delhi
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