Voluntary separation scheme....golden handshake...is it legal?
prashant1314
(Querist) 01 November 2011
This query is : Resolved
Dear Experts,
If the employer want to close down particular department / company & frames Voluntary Separation Scheme for employees isn't it illegal under provsion of Section 25 - O of ID Act?
Guest
(Expert) 01 November 2011
I don't think there is any such section 25-O in the ID Act. Please quote the correct section.
prashant1314
(Querist) 01 November 2011
Industrial Disputes Act, 1947
25O. Procedure for closing down an undertaking
1[25O. Procedure for closing down an undertaking. (1) An employer who intends to close down an undertaking of an industrial establishment to which this Chapter applies shall, in the prescribed manner, apply, for prior permission at least ninety days before the date on which the intended closure is to become effective, to the appropriate Government, stating clearly the reasons for the intended closure of the undertaking and a copy of such application shall also be served simultaneously on the representatives of the workmen in the prescribed manner:
Provided that nothing in this sub-section shall apply to an undertaking set up for the construction of buildings, bridges, roads, canals, and dams or for other construction work.
Raj Kumar Makkad
(Expert) 01 November 2011
When this particular section prescribes procedure to close down an establishment, as you also quoted, then how can you say it an illegal?
Provision may be ultra-virus under your views but it is not an illegal till it is so declared by Apex Court of India.
prashant1314
(Querist) 01 November 2011
Dear Makkad Saab,
I am talking about the VSS ( Voluntary Separation Scheme) which employer frames without resorting to Section 25 O
Raj Kumar Makkad
(Expert) 01 November 2011
Then you can challenge the action of your employer rather getting declaration of this section ultra-virus. This section come to your help now. You receive all payments under protest and then challenge the action of your employer.
prabhakar singh
(Expert) 02 November 2011
Any such scheme framed by employer against this provision can not sustain.
R.Ramachandran
(Expert) 02 November 2011
Mr. Prashant should not have raised this question at all for the scheme itself is voluntary. If one does not want to opt for the scheme, it will not affect such a person. If a person accepts voluntarily, it is his decision. There is no force at all. If at all, there is facilitation by such a Scheme. Therefore, where is the illegality in it? Suppose an organization does not want to close down, but only would like to trim its work force, can't it devise such schemes? Where is the bar?
