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A (Engineer)     25 August 2012

Compensation for severance / forced resignation

Hello experts,

I work as a software engineer in a IT company(nature of employment is permanent) and have been an employee here for about 20 months (more than 1.5 yrs). Recently (About 1.5 months back), they mentioned that my performance was not good and I would be put on a performance improvement plan (PIP) . Now, they are saying that they are still not satisfied with the performance so I can expect that the end of next month will be my last working day. Effectively, they are giving just about a month's notice.

As per my offer letter, a 3 months notice is required from either side, or payment of fixed salary equivalent to the notice period. However, there is a clause in the letter that if it is due to performance grounds, then no notice is required.

My work is mainly at the execution level so I believe that I would qualify as a 'workman' as per the industrial disputes act.

My questions are as follows:

1) As per the industrial disputes act, would termination by giving 'performance' as reason qualify as 'retrenchment' ?

2) As per various acts including the ID act, can I expect any severance compensation from them(including payment of salary in lieu of notice because they obviously dont want me to continue in the company for the period of 3 months). If yes, then what is the maximum amount I can get, and how do I go about negotiating it with them? I may be willing to resign if they provide adequate compensation.

3) What is the best course of action for me to take?

(Mr. Doab: You may be already familiar with the case as I had posted about some of the developments about a month back.)
 

Looking forward to your responses, and thanks in advance.



Learning

 5 Replies

Kumar Doab (FIN)     25 August 2012

Pls copy paste previous thread title and link.

A (Engineer)     25 August 2012

Mr. Doab :

The title of my previous post is: Threat of termination (posted about a month ago)

The link is: https://www.lawyersclubindia.com/forum/Threat-of-termination-62767.asp#.UDj89lTI9Tg

Look forward to your inputs on this.

Kumar Doab (FIN)     26 August 2012

You have already evaluated that you shall fall within the category of workman.

It is felt that since it is recorded in PIP document that service can be terminated you and all employees can approach o/o Inspector/Asstt. Labor Commissioner.

If there are many employees in PIP then company is in process of mass termination and is probably avoiding to be accused of retrenchment. All employees may unite and be witness to each other.

The termination order may be issued as termination simplicitor without leveling any charge however company has apparently already issued many communications to you regarding performance and has demanded to sign a PIP document and to sign to generate unrealistic revenue performance.

The dip in performance is in your individual case only or it is uniform and universal in your office, region, zone, pan India? Has the company evaluated the reasons and tried to train employees. Has the company become uncompetitive in market?

Where is the fault and lapse in company, its policies, products, price, features, customer service, back up service, resolution of customer complaints, availability of spares, less service centers, etc? Has the line management been adaptive and has adopted tailor made policies and practices/processes to boost the performance in highly competitive market?

Do you have MIS of performance record?

What is your rank in PIP employees? Usually companies circulate the MIS. You may keep all data with you. If terminated all access to all data and record shall be blocked.  

As per your previous thread: The HR has issued a threat of bad reference check to marr your future source of livelihood.

Read your appointment letter carefully i.e. clause on separation and each para in appointment letter. Company might have written in last para that in case of under performance your terms of appointment can be modified/reviewed implying employment can not be terminated.

IT/ITES policy govt. of Maharashtra is enclosed. You may obtain the latest version from labor website or labor office or market.

 

Has the company supplied you the FNF statement? If yes you may reject to accept the same and if the mount has been transferred into your bank a/c you may accept only under written protest which should under acknowledgment with a copy to you.

It shall be appropriate to let your labor consultant/service lawyer structure all of your communications.

 

Kumar Doab (FIN)     26 August 2012

Valuable advice of learned experets/members is sought.

Try your level best and find another job.

IT/ITES policy govt. of Maharashtra is enclosed. You may obtain the latest version from labor website or labor office or market.

4.4        Industry-friendly and supportive environment:

(b)     Relaxations     under    Shops    &   Establishments      Act   for  working

        hours, work shifts and employment of women.

{ the relaxation has been described implying other provisions of the act shall apply}

 

(c)     Applicability of all relaxations under the Industrial Disputes Act

        and Contract Labour Act to all IT and ITES units in the State on

        par with Special Economic Zones.

(h)     Suitably amending various labour laws for facilitating submission

        of reports/returns in electronic formats.

(i)     Permission   to   IT   and   ITES   units   for   self-certification   of   reports

        and returns.

4.5        Fiscal Incentives:

{Lots of incentives have been provided so the companies should also keep the trust posed in them by adhering to the applicable laws and rules}

 

8.            Developing a pool of globally employable manpower:

8.2.    Private Training Institutions, and IT and ITES companies shall be

               offered     infrastructural    facilities   in  schools    of   the   Municipal

               Corporations, Municipal Councils and Zilla Parishads on a lease

               basis,    during    non-working       hours    of  schools,    for   conducting

               training   in   IT,   ITES   related   skills   as   well   as   English   language

                skills. { Has the company conducted any training for employees}

9.            Industry friendly and Supporting environment:

9.3     Reports/Returns      in  electronic   formats   will  be   accepted   as  per

               provisions   of   IT   Act   2000.  To   enable   IT   and   ITES   units   to

               submit     reports   and   returns   in  electronic    formats,    necessary

               amendments in the following Labour laws shall be made.

 

            Employees State Insurance Act

            Factories Act

            Payment of Wages Act

            Minimum Wages Act

            Contract Labour Act

            Shops and Establishments Act

            Workmen's Compensation Act

{ This implies company has to adhere to the provisions of these enactments}

9.5     ITES     shall  be  declared    as Public    Utility  Services    under   the

               Industrial Disputes Act and as Essential Services           (for more than

               six   months)     under    the  provisions    of   Maharashtra     Essential

Services    Maintenance     Act   1999  by    necessary    amendments      in

               these laws.

 

 

Check if your company falls in the list as in annexure of IT policy?

 

You may also go thru

 

https://www.mah.stpi.in/

 

for software technology parks of India rules in Maharashtra.


Attached File : 113346015 maharashtra itpolicy2003.pdf downloaded: 153 times

Kumar Doab (FIN)     26 August 2012

Identify your compnay is IT or ITES, IT hardware, or MSME as per Maharashtra IT policy and relate with rules as applicable.

 

9.5     ITES     shall  be  declared    as Public    Utility  Services    under   the

               Industrial Disputes Act and as Essential Services           (for more than

               six   months)     under    the  provisions    of   Maharashtra     Essential

Services    Maintenance     Act   1999  by    necessary    amendments      in

               these laws.

 

Discuss the matter in detail and show all documents to your labor consultant. Thus you shall be clear on the recourse available to you.

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