Employee Termination - Comply with the Law and Give Reasons

Employee termination is a serious business. If not handled right in accordance with the law, corporate rules and procedures, it can cause a lot of problems for your organization.

It is important that HR people, line managers and supervisors have adequate knowledge on the essentials of termination of employees.

You may terminate employees:

  1. with cause for;
    • misconduct;
    • non-performance / poor performance;
  2. when a fixed term employment contract ends.

Termination With Cause
You cannot terminate an employee without cause even if this is not stated in the appointment letter. The requirement of a notice to terminate the appointment does not take away the need to have basis for termination.

Courts rulings are very clear on this.

In cases of misconduct, disciplinary action is initiated based on the organization's disciplinary rules.

In the case of non-performance or poor performance on the job, the courts had ruled (the common law) that employers must bring the lack or poor performance to the attention of the employees at fault, provide them with counseling and training and give them enough time to improve.

Whether the employee is on permanent appointment or temporary appointment, termination is carried under the same rules and procedures. The appointment letter or the Employee Handbook may have referred to this. Click HERE for information on sample appointment letter.

Employee termination results in loss of benefits and privileges. Further to this, the employee may expose himself or herself to criminal proceedings in the case of serious misconducts such as injuring somebody whether at work or away from the workplace.

Hidden Risks in Employee termination

Fixed Term Contract
A fixed term employment contract comes to an end on the date stated in the agreement. A fixed term contract has a specified commencement date and an end date. The employee termination in this case falls on the date specified in the contract of employment.

However, the wordings of the terms and conditions contained in the contract may allow the employee to apply for an extension of the employment contract. This is an option to renew the contract.

It is fairly common for the HR Head to ask the employee's superior whether he or she supports the extension of the employment contract based on needs. If the service of the employee is no longer needed, the termination letter is issued in response to the application for extension of service.

Can an Employee Self-Terminate His / Her Service?
Aside from resignation, the only other way that an employee ends his or her service automatically is when he or she absconds from duty for a period longer than the stipulated period, say, three months.

After the end of the stipulated period, the employee is deemed no longer an employee. There are specific rules such as advertising in a local paper requiring the absent employee to report for duty. Check out the legal provisions including government legislation.

Terminating employees is risky. You will not know some of these in the beginning when you initiate the termination provision.

Avoid making expensive mistakes. It is precisely because of this that you need to find out, identify and avoid every mistake that can make or break your organization. For the short term and in the long run.

Seek professional advice, both in-house counsel and from appointed external legal practitioners.

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