- It Life Fun or Problems – Series 2 – PART 1
- “Clean Exit” – Sacred Cow of HR and Employees
- “Company has Right to Terminate Employment any Time” – True or False?
- Compliance Violation and Termination – Facts to Know
- Nazi Gas Chambers and HR Exit Process
- What Legal Rights I have as an IT Employee?
- How Much it Costs to Approach Labour Department?- Zero!
- Fixed Term Employment : A Ticking Time Bomb
- HR Targetting Pregnant Employees is Illegal and Inhuman
Shyam Sundar who is a part of NDLF IT Employees Wing is having around 20 years of experience in information technology. He wrote an article series on “IT employees Life Fun or Problems” to create awareness about various issues faced by IT employees. This write up is fourth part of Series 2.
In the previous parts, we have seen employee who were shown exit door through forced resignation as voluntary attrition by company. There is another method through which the company can fire the employee – compliance violation.
Some of the common compliance issues company can take action on are:
- Thefts, damage to company properties
- Sexual harassment cases
- Absconding to work
- Irregular attendance
- Criminal offences
Only such serious misconduct can lead to termination of employment, not other minor mistakes an employee might make during normal course of work life even if the HR makes them out to be a major compliance violation.
Termination is not the final destiny of all compliance issues. In legal system, punishment is corresponding to the severity of crime. For example, petty crimes like pick pocketing and chain snatching may lead to 6-12 months of imprisonment; we cannot hang the suspect to death for such petty crimes. Likewise all compliance issues can not lead to termination.
I had a phone conversation with a girl who is working in one of the largest companies based in Mumbai. She has 2 years of experience overall. She wanted better rating as part of appraisal rating and she requested her client manager to give good feedback for her contribution. The client manager mentioned this to the onsite manager. This is then escalated by onsite manager and was recommended to HR for necessary action. The HR officer told her that her act is against company policy and asked her to submit resignation on her own.
In reality, HR officers will still ask employee to submit resignation even when they raise compliance issue, not go for termination. The main reason is terminating employee based on compliance issue is also not easy.
In the above example of lady employee, breach of compliance is absolutely not there; it is quite common in IT industry to ask for client feedback even in organization level. Many companies have quarterly/annual customer satisfactory reports and feedback is sought from client. Even for argument sake, if we assume that there is a breach of compliance, it does not qualify termination as punishment.
The girl whom I talked to was very scared and very much worried about losing her job. She lost her self-confidence and was in a mindset that she has done very big mistake in life. I convinced her that you are not Nirav Modi where you have cheated the banks worth 15000 crores (even he is happy after this scam enjoying life in foreign county). So don’t have a sorry face. I made her understand that she has not done any serious mistake and should not show sorry face to the HR officer and resist to resign.
The company has to follow various procedures while terminating employees based on compliance issues (gross misconduct):
- Company has to issue warning letter and give chance to employee to present their side. For example, if employee is absconding and not coming to work, company has to issue warning letter to report to work by certain date. If employee continues to abscond, company should try to understand the reason and give final warning to change, If the employee still not following the rules, company can issue termination letter
- Company should have clear grievance mechanism and should listen to the employee side.
- Company should have sufficient proofs to substantiate the breach employee committed.
- If employee has irregular attendance, company can ask employee to apply for leave but not able to terminate them at first stance itself.
In many forced resignation cases, HR officer uses compliance issue as their shield to break employee’s confidence who is refusing to resign. Compliance issue is used as a weapon to make employee submit self-resignation on their own. The employee who agreed to resign will be shown as voluntary attrition case to outside world and the case will be closed.
Employee should understand that company should follow legal procedure while terminating based on compliance; even then hanging to death is not the punishment for minor crimes. I am not supporting chain snatching or small mistakes; I am only pointing out that company has the right to terminate if it is legally correct but not for petty issues.
I also want to highlight some of the areas where employees targeted for layoff may fall into compliance issues
- Management will keep the employees who resist to resign in bench . Many of the companies don’t have dedicated office space for all employees who are in bench. Usually bench constitute 5-10% of the work space and it is difficult for the management also to provide workspace for all employees. So many employees don’t keep timings of attendance during the bench period. For example, if employee has to log 8 hours of attendance as per company policy, employees in bench may not log this hours. This will be caught later by management and quoted as compliance issues
- Take extreme caution on integrity constraints formulated by the company. Now the company is watching for fault and even small integrity violation will be brought big as compliance issues later
- The company may make employees being in bench for longer time as compliance issue. This is not valid as employee placement is based on sales team getting new projects, placement team who is responsible for placing employees and then the employee themselves. So blaming employee alone for not getting placed is not correct and employee can fight it back
- The employee targeted for layoff is no more having the same relation they have before they resist to resign. So it is extremely important for employees to maintain professional behavior during this difficult time.
I hope this gives an overall view on the most common ways through which employees are targeted for layoffs.
In most of the companies, layoffs are initiated as part of performance appraisal and appraisal process is the root cause used for layoffs. We will have a very detailed look on appraisal process in the next part.
– Shyam Sundar