Can an Employee Sue an Employer for Wrongful Termination?

 Introduction

Wrongful termination or wrongful dismissal is a situation in which the contract of employment of an employee is terminated by the employer. Such dismissal breaches one or more terms of the contract. It is one of the most common types of employment disputes. Every year a countless number of employees are subject to wrongful termination but are unaware of the correct legal recourse.

Termination of an employee is an unwanted and unpleasant procedure however this termination must be conducted in an ethical and legal manner. The termination may be termed as illegal if it is done for any of the reasons such as Discrimination, Breach of contract, and a variety of other factors such as a personal bias.

There are many laws in India that protect employees against wrongful dismissal such as the Industrial Disputes Act, 1947, The Workmen’s Compensation Act, 1923 and the State Shops and Establishments Act and even the Indian Constitution itself.

  • Dismissal of an Employee without pay

The right to live and earn a livelihood is the fundamental right of every Indian citizen. It is the right of an employee to be paid by the employer for the work that the employer derives from the employee. Although there are laws such as The Payment of Wages Act,1936 there should be no need to refer to them as it is unfair for the employer to keep any money that rightfully belongs to the employee. Unless the employee through willful negligence has caused a large quantum of damage to the employer.

  • Full and Final Settlement

The procedure for the full and final settlement is often fairly straightforward as per the job contract, usually, it includes the following

  1. Unpaid salary (including annual benefits and arrears)
  2. Payment of non-availed leaves
  3. Gratuity (if I have completed 4 years and 240 days)
  4. Pension (if we have cleared the requisite for pension)
  • Layoffs and Retrenchment

Section 25A-25S of the Industrial dispute act deals with the Retrenchment and layoff of employees. A layoff is a temporary suspension of an employee on the reason for punishment and retrenchment. On the other hand, Retrenchment is the removal of the surplus staff due to an inability to maintain staff.

According to the aforementioned sections of the act, an employee is not to be laid off or retrenched without adequate reasons. If the layoff is performed in accordance with the Industrial Disputes act then the employer is liable to pay 50% remuneration to the employee provided the organization comprises over 50 people and is not of a seasonal nature.

  • The Fifth Schedule: Unfair Labor Practices [Section 2 (Ra)]

    Firstly, Threatening the workforce with discharge if they join a trade union. Secondly, Discharging a workman because he urged other workers to join a trade union.

  • Discharging a workman for taking part in a strike (not a strike deemed illegal under this Act).

To discharge a workman

  1. By way of victimization
  2. In bad faith
  3. Falsely implicating a workman in a criminal case
  4. For patently false reasons
  5. On the untrue allegation of absence
  • Wrongful Termination of Employee during Maternity Leave

According to the Maternity Benefit Act 1961, section 12, Dismissal during the absence of pregnancy is unlawful on part of the employer. Such a dismissal may only be legal if there is gross misconduct on part of the employee.

  • Dismissal on account of Employee Disablement

On account of the Workmen Compensation Act, 1923, Section 3, it is unlawful to dismiss an employee for a disablement caused by an injury during employment.

  • Dismissal On account of Discrimination

If an employee is dismissed from his position based on age, race, sex, nationality, or any other such discriminatory grounds, it is will be an unjust form of dismissal under the fundamental rights granted by the constitution of India itself.

What should be done if one has been wrongfully terminated?

Once it is affirmatively established that the employee has been wrongfully terminated, an appropriate remedy can then be chosen. For instance,  Some options are as follows.

A formal grievance of wrongful termination should be filed with the Human Resources department of the company. Time should be given to them to analyze and evaluate the case and come up with a solution. Usually, the HR department is able to solve the dispute.

If the answers from the HR department are not satisfactory, a labor lawyer can be hired to send a notice to the employer seeking damages.

The damages may include:

  1. Lost Benefits
  2. Injunctive Relief
  3. Punitive damages
  4. Back Pay
  5. Provident Fund

A lawsuit can be filed with the employer in case of a breach of an employment contract in the labor court. If deemed fit the court can order the employer to pay damages.

Indian employment laws are complicated. An employer who recognizes the loopholes may try to escape his liabilities for wrongful termination lawyer in Gurgaon. For wrongful termination of employment lawyers You can contact an experienced lawyer to fully understand the legality of the whole situation.

By Aryan Dhingra,
 B.B.A LLB, 2nd Year student of OP Jindal Global University

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