Termination notice

1.  If contract says only one month notice. Employer paid for one month and immediately terminated, that is deviation from the contract. However court generally treat salary in lieu of notice, valid if full salary with all benefits paid.

2.  If you are workmen industrial dispute act apply and immediate termination can be challenged. If you are in managerial position purely contract matter, civil suit for breach can be filed.

Terms and conditions of appointment shall prevail.

If the clause reads that “Either party may terminate the employment by giving one month notice.”, then technically, the employer is expected to allow you to work for one month, or terminate you immediately only if the contract allows payment in lieu of notice. If there is no mention of “payment in lieu of notice”, then the employer cannot unilaterally substitute notice with salary unless the appointment letter has a general clause permitting compensation instead of notice, or Company HR policy allows it and is incorporated into the contract.

What is the context for this query?

In a contract between a worker and employer the worker gives work and the employer gives cash in compensation. It may be that for the termination of the contract one month's notice is required from either side. The worker should give one month's notice if he wants to leave the job. The employer has to give one month's notice to terminate the service. In any contract if either of the parties is not able to serve the contract there is always an implied provision for monetary compensation. That is the principle of a modern contract. If the employer does not need the service of the employee and he is not able or not prepared to keep him service he can terminate the employment giving monetary compensation. Similarly if the employee is not able to serve as per contract he can get out of the contract by giving monetary compensation. Only in contracts like that in our puranas monetary compensation won't suffice.