Employee Separation is one of
the very important and crucial function / process of HR Department. This
process, if not handled in an efficient manner, can lead to various legal
complications.
Let's understand the term employee. According to various definitions an employee
can be defined as:
1. A worker who is hired to perform a job
2. An individual who provides labor to a company or another person
3. An individual who provides services for compensation to an employer and whose
duties are under the control of the employer
An employee works for an employer and gets paid for his work and nothing else.
The relation of an employer and employee has a beginning; they stay together for
a while and then they separate. Beginning of the relation is called as
recruitment process or talent acquisition that passes through selection phase
and followed by induction. Staying together in the relation comprises the
various phases such has performance management; career management; professional
growth; development and etc. And the final stage of the relation is the
separation.
Broadly speaking, in normal scenarios the separation between employer and
employee can be due to any of the following three:
1) Resignation - Employee decides to leave the organization.
2) Termination - Employer decides to break the contract of employment.
3) Absconding - When the employee decides to leave the organization without
tendering his resignation or following the proper process of separation.
Apart from the above mentioned, the relation between employer and employee can
also be terminated during the lay-offs (financial or economic crisis); during
the process of mergers, acquisitions and take-over; or any other legal
intervention by the state or central government.
Based on the type of employee that has been hired by the company, if local or an
expatriate or a national of other country or if an employee is hired through
outsourcing agencies, the process of separation and the documents involved in it
also differs.
TYPES OF SEPARATION
Resignation:
This is the most common way of separation. Employee leaves his job and
employment with his employer to pursue better opportunities; a better position
at a better compensation package in a branded company (or better known company)
in a same city and country or in a different city or different country.
So, an employee resigns for:
• Better compensation and benefits
• Higher position / level
• Challenging role
• To move from an unknown or lowly branded company to a highly branded and
reputed company
• For foreign or international assignments
Termination:
Usually, this process is perceived negatively by employees. In termination, an
employer uses his right to terminate the contract of an employment. There can be
many reasons for an employer to terminate the contract of employment but some of
the common reasons are:
• Non-Performance
• Indiscipline
• Misconduct
• Insubordination
• Theft and etc
Absconding:
This is one of the most unethical, unexpected and unprofessional way to
terminate the contract of an employment. In this, on one fine day an employee
decides not to go to work. He does not care to hand-over his stuff. In case an
employee decides to abscond (or run-away), it becomes very important to
understand his motives and intentions. Employees can abscond in either or all of
the below mentioned circumstances / situations:
• After stealing the confidential information or documents or database from the
company.
• If the intentions of an individual is to commit a crime.
• If there is a work-pressure and stress and the individual is not able to
cope-up with it (as it happens in call-centers, and other high-stress
industries).
• If the employee has committed any crime outside the office and after working
hours (such as murder or getting involved in terrorist activities or theft or
any other civil crime).
• Then, when priorities are different. Employee has asked for leave due to some
urgency at his home (or might be he is trying to escape from his work
responsibilities) and at the same time his team also needs him in the office and
his leaves are not approved.
• If he has got some exceptionally good opportunity that requires him to join
immediately and he feels that the process of separation in his company is a bit
too complicated. He assumes few things and do not really try to face the
challenge.
• Lastly, it is a personality issue. Employees that abscond have different
personalities. They are low in confidence. They are too weak to face the reality
and challenges of life. They feel that running away from the problem is as good
as solving the problem. They are cowards to take the problems head-on.
THE PROCESS OF SEPARATION
Resignation:
Once an employee gives his resignation to the department head or the management,
it is important for HR to schedule the first meeting with him. Preferably the
meeting should be scheduled within 24 hours or else it will give an impression
that "no one really cares". Being a neutral department, the meeting should be
administrated by HR Manager (Employee Relations Manager) or anyone senior to him
to understand the root cause of separation.
1. If the root cause is an issue with the reporting manager of an individual; or
some conflict with a team-member or some other human issue, try to address the
same with the concerned person.
2. If the reason for resignation is better opportunity or a higher position,
explain to him the Performance Management System and Career Management System of
the company. If possible, show him his performance records. Do not make any
commitment that you might not be able to fulfill, such as, "we will give you a
promotion in this appraisal" or "will send you overseas for an assignment" and
etc and etc.
3. If an employee has given his resignation because he is getting a better
compensation package, explain to him the grading system and compensation package
of your company and also share with him the minimum possible increase that he
might get in his next appraisal but do not give any hike immediately. You might
be required to repeat this exercise after another couple of months. So, don't
show any blood to the lion.
Any other reason of resignation, such as policies of the company, benefits,
branding and positioning of the company, working hours and etc are beyond the
preview and scope of this discussion with HR. Such issues cannot be changed to
suit the needs, demands and requirements of one individual. However, if more
employees are leaving the organization for one specific reason then the
management should address the matter but this should not be done for one
specific employee.
After the meeting give your feedback to the department head and advise him on
whether to accept the resignation or not.
Once the resignation is accepted, issue the "letter of acceptance of
resignation" to the concerned employee and inform the IT, Payroll and Finance
Department.
Responsibility of the Department Head:
Now, the department head needs to plan the process of handover of duties,
projects and assignments to other member(s) in the team.
1. Let the departing employee complete all the tasks and assignments he has in
hand.
2. Do not assign any new project or assignment to this employee.
3. If there is nothing to complete and proper hand-over is done, then relieve
the employee as soon as possible.
It is a proven fact that once an employee decides to leave the organization and
gives his resignation, they show less commitment, sincerity and dedication in
their work. Hence, it is important to relieve them as soon as possible rather
than them coming to the office and wasting the time of people who are dedicated
to their work and resources of the company.
Responsibility of the HR Department:
HR, on the date of acceptance of resignation letter, should instruct the IT
department to keep track on all the outgoing emails from the system of
separating employee. All IT permissions and rights should be withdrawn from that
employee and he should not be allowed to send any email to any other email ID
except the office email ID's. He should not be allowed to copy or edit or delete
any file from his system.
HR should ask the concerned employee to obtain no-due letter from all the
concerned departments.
HR should calculate all the amount payable to that employee and the payment
should be made on the last working day of the employee. On his last day, the
company should also give him the relieving letter.
In case of expatriate employees
Even in the case of expatriate employees, the process will be the same except
that the involved stake-holders will be more. An expatriate employee is a
responsibility of employer and hence care should be taken to ensure that
everything runs as smooth as possible, till the very last day of the employee in
the organization. Therefore, in addition to various departments within the
company, the HR should also inform:
1. The immigration office of the concerned country about the company's
disassociation with the employee;
2. The banker, healthcare insurance provider, landlord and other service
providers;
(This is to ensure that these stakeholders shall not disturb the company to
recover any cost or loss due to its ex-expatriate employee.)
Termination:
Termination can be challenged in the court of law. Hence, care must be taken to
document all the incidents that have led to the termination of an employee.
In case of disciplinary action, the company should take care that the proper
procedure is followed. Warnings (oral and written) were issued to the employee
and the whole incident is properly documented.
In case of non-performance, the required documents must include:
a. Tasks given
b. Expected performance level
c. Evaluation criteria
d. Actual performance
e. Shortfall
f. Action required
Parties involved in the termination process include:
1) The Reporting Manager
2) The Department Head
3) The HR and / or
4) Any other senior member of the department
Once the decision is taken to terminate the contract of employment, the company
should seize all the belongings of that employee - such as computer, drawer,
access cards, laptop, ID Cards, files and etc.
Employee should be given the letter of termination clearly specifying the
reasons of termination.
Based on the severity of the case, the company might decide to pay the employee
for the notice period. For example, in case of non-performance he must be paid
for the notice period but in case of any disciplinary action, theft or
misconduct, he should not be. The entire amount due to him must be recovered.
CONCLUSION
The processes described in this article are just the general outline that must
be followed in case of any separation and not any industry or company specific
processes. Based on the employment laws applicable in the countries that they
are operating in, companies can choose to be more stringent or lenient in their
approach. The process described here is more amicable and ethically correct.
Once an employee decides to resign and leave the organization, whatever you may
do but he will leave; if not today then tomorrow. On the other hand, if the
employer decides to terminate the contract, he might change his mind, provided
the case against the employee is not very severe.
Absconding, as mentioned above is in itself is a crime; something that only
coward people do; such people just give-up without even making an attempt. These
people run away from the reality of life and from the challenges that life
offers to get best out of you and to make you master.
As an employee whenever you decide to leave the company, do it in a more
professional and acceptable manner.
As an employer, whenever you decide to terminate the contract of employment of
any employee, make sure that you document all the incidents in a chronological
manner and have in your possession, all the required evidences. Unfortunately,
decision of resignation cannot be challenged in any court and it is considered
as a right of an employee but decision of termination can be challenged.
Employee separation is a big process and does not involve unilateral decisions.
Be accurate. Be professional.