Wrongful Termination Of Employee

What is Wrongful Termination of an Employee?

The term termination is defined as the removal or discharge of a person from an establishment. It is one of the most unpleasant thing that a manager or the employer might have to do. In case the termination is requires for the establishment’s benefit then it must be carried out in an ethical and professional manner. The employee must be given proper chance to state facts in his defence and the same must be available to the employer. This is the most basic principle of concept of Natural Justice, Audi Altrem Partem i.e. no one should be condemned unheard. The person must be given all possible chances to give his defence, followed by an internal enquiry and after the said enquiry he must be served upon by the show cause notice. This is done in order to abide by the principle of Natural Justice and in order to ensure fair chances for the person to give defences and call upon witnesses, as and when required.

An employee can be terminated on the following ground:

  • Inefficiency
  • Misconduct
  • Violation of confidentiality agreement
  • Breach of employment contract

The consequences of termination on the following ground may result in:

  • Non-Competition Restrictions
  • Non-Solicitation Restrictions
  • Non-Disclosure of confidential Information

However, the termination of an employee without adhering to the principles can be termed as wrongful termination. A wrongful termination is defined as a situation in which an employee's contract of employment has been terminated by the employer if the termination breaches one or more terms of the contract of employment, or a statute provision in employment law. Before terminating a person it is the duty of the employer to ensure that the person gets a fair chance to be heard according to the principles of Natural Justice.

The Industrial Disputes Act, 1947 is responsible to govern and regulate the relationship between the relationship between the employer and employee. The Act also prescribes the mechanism to be followed by employer after termination of 'workmen' and the compensation payable upon such termination.

Any employment with the private company is based on the contract entered upon at the time of joining which comes in the ambit of the Indian Contract Act, 1872.


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