Managing Dismissals:

Dismissal is the most drastic disciplinary step the employer can take. For the dismissal, there should be sufficient cause, and (as a rule) you should only dismiss someone after taking reasonable steps to rehabilitate or salvage the employee. However, there will undoubtedly be times when dismissal is required, perhaps at once. Many dismissals are a result of bad hiring decisions. Hence, effective selection practices such as assessment tests, reference and background checks, drug testing, and clearly defined job descriptions can reduce the need for many dismissals.

Termination at Will:
Termination at Will is a doctrine of American Law that defines an employment relationship in which either party can break the relationship with no liability, provided there was no express contract for a definite term governing the employment relationship and that the employer does not belong to a collective bargaining group (i.e., has not recognized a union). Under this legal doctrine: any hiring is presumed to be "at will"; that is, the employer is free to discharge individuals "for good cause, or bad cause, or no cause at all," and the employee is equally free to quit, strike, or otherwise cease work.

Wrongful Discharge:
Wrongful dismissal, also called wrongful termination or wrongful discharge, is an idiom and legal phrase, describing a situation in which an employee's contract of employment has been terminated by the employer in circumstances where the

termination breaches one or more terms of the contract of employment, or a statute provision in employment law. It follows that the scope for wrongful dismissal varies according to the terms of the employment contract, and varies by jurisdiction. Note that the absence of a formal contract of employment does not preclude wrongful dismissal in jurisdictions in which a de facto contract is taken to exist by virtue of the employment relationship. Terms of such a contract may include obligations and rights outlined in an employee handbook. Three main protections against wrongful discharge have eroded the termination at will doctrine statutory exceptions, common law exceptions, and public exceptions. First, in terms of statutory exceptions federal and state equal employment and workplace laws prohibit specific types of dismissals. For example, Title VII of the Civil Rights Act of 1964 prohibits discharging employees based on race, color, religion, and sex or nationals origin. The Age Discrimination in Employment Act prohibits discrimination against persons 40 years or older. The Family and medical leave act provides employees with up to 12 weeks of protected unpaid leave for things like serious health conditions Occupational safety laws prohibit firing employees for reporting dangerous workplace conditions. Second, numerous common law exceptions exist. For example, some state courts recognize the concept of implied contracts in employment. Thus a court may decide that an employee hand book promising termination only for just causes create an exception to the all will rule. Similarly an employer may create an impression of secure employment by incorporating in its hand book progressive discipline policies are series of procedures they will follow before taking adverse employment actions. Torts are special protections created by the courts. One is against intentional infliction of emotional distress Here a state court may deem an employers actions toward the employer so extreme and outrageous that if overturns a dismissal.

Finally, under the public policy exception, courts have held a discharge to be wrongful when it as against an explicit well established public policy (for instance the employer fired the employee for refusing to break the law).

Grounds for dismissal:

There are four bases for dismissal unsatisfactory performance, misconduct, lack of qualifications for the job and changed requirements of (or elimination of) the job. Unsatisfactory performance means persistent failure to perform assigned duties or to meet prescribed job standards. Specific grounds include excessive absenteeism tardiness a persistent failure to meet normal job requirements or an adverse attitude toward the company, supervisor or fellow employees. Misconduct is deliberate and willful violation of the employers rules and may include stealing rowdy behavior and insubordination. The Know Your employment law feature discusses an extreme example given misconduct. Lack of qualifications for the job is an employee inability to do the assigned work although he or she is diligent. Because the employees may be trying to do this job, it is reasonable for the employer to do whats possible to salvage his or her perhaps by assigning the person to another job, or retaining the person. A changed requirement of the job refers to an employees inability to do so the job after the employer changed the nature of the job. Again, the employee may be industrious so it is reasonable to retain or transfer this person if possible.

Insubordination:
Insubordination is the act of willfully disobeying an authority. Refusing to perform an action that is unethical or illegal is not insubordination; neither is refusing to perform an action that is not within the scope of authority of the person issuing the order.

Insubordination is typically a punishable offense in hierarchical organizations which depend on people lower in the chain of command doing as they are told.

Fairness in Dismissal:
There are 3 things we can do to make sure that the dismissals are fair. 1. Full Explanations: individuals who said that they were given full explanations of why and how termination decisions were made were more likely to perceive their layoff as fair and indicate that they did not wish to take the past employer to court. 2. Multistep procedure: It institutes a formal multistep procedure (including warning) and a neutral appeal process.
3. Who actually does the dismissing: Employees in one study whose managers

informed them of an impending layoff viewed the dismissal procedure as much fairer than did those told by, say, a human resource manager.

Security measures:
Security measures are important whenever dismissal occurs. We should use a checklist to ensure that dismissed employees return all the keys and company property, and (often) accompanying them out of their offices and out of the building. The employer should disable Internet-related passwords and accounts of former employees, plug holes that could allow an ex-employee to gain illegal online access, and have rules for return of company laptops and hand-helds.

Avoiding Wrongful Discharge Suits:

Avoiding wrongful discharge suits requires a three-pronged approach. 1. First, create employment policies including grievance procedures that help make employees feel you treat them fairly. Similarly, employers can use severance pay to blunt a dismissal sting. There is no way to make termination pleasant, but first line of defense is to handle it justly. 2. Second, review and refine all employment-related policies, procedures, and documents to limit challenges. Make sure that employment application contains a statement that employment is for no fixed term, and that the employer can at any time. Pay particular attention to employee handbook. 3. Third, make sure you clearly communicate job expectations to the employee; failing to do so triggers many wrongful termination claims.

Termination Interview:
Dismissing an employee is one of the most difficult tasks a manager faces at work. Guidelines for termination Interview are: 1. Plan the interview carefully: this includes following: Make sure employee keeps the appointment time. Allow 10 minutes as sufficient time for the interview. Use a neutral site, not your own office. Have employee agreements and release announcements prepared in advance. Have phone numbers ready for medical or security emergencies. 2. Get to the point: Avoid small talk. As soon as the employee enters, give the person a moment to get comfortable and then inform him or her of your decision.

3. Describe the situation: Briefly explain why the person is being let go. Emphasize that the decision is final and irrevocable. 4. Listen: To the extent practical, continue the interview for several minutes until the person seems to be talking freely and reasonably calmly about the termination and the support package including severance pay. 5. Review all elements of the severance package: Briefly describe severance payments, benefits, access to office support people, and how references will be handled. However, make no promises beyond those already in the support package. 6. Identify the next step: The terminated employee may be disoriented and unsure what to do next. Explain where the employee should go upon leaving the interview. Its often best to have someone escort him or her until the person is out the door.

Outplacement counseling:
In some cases, an employer may help a terminated employee find a new job. This process is referred to as outplacement counseling. Identification In outplacement counseling, a terminated person receives career counseling to help make the transition to a new career. Significance A person receives help with dealing with the trauma of being terminated during outplacement counseling, according to the ERIC Clearing house on Counseling and Personnel Services. Counseling also entails evaluating career options and learning job search strategies.

Considerations Consulting firms and human resources departments are two prominent places where a person receives outplacement counseling. Effects Outplacement counseling has increased over the years because of increased corporate downsizing and restructuring. Benefits Outplacement counseling can reduce lawsuits and grievances as well as create a smoother career transition for the terminated employee.

Exit Interviews:
An exit interview is a survey conducted with an individual who is separating from an organization or relationship. Most commonly, this occurs between an employee and an organization, a student and an educational institution, or a member and an association. An exit interview is the most accurate instrument in assessing the issues that drive an individual to leave an organization. Few other tools illustrate why the individual is separating, what he or she valued while at the organization, and what aspects of the organization needs improvement in order to increase employee engagement, performance, and loyalty. An organization can use the information gained from an exit interview to assess what should be improved, changed, or remain intact. More so, an organization can use the results from exit interviews to reduce employee, student, or member turnover and increase productivity and engagement, thus reducing the high costs associated with turnover. Some examples of the value of conducting exit interviews include shortening the recruiting and hiring process, reducing absenteeism, improving innovation, sustaining performance, and reducing possible litigation if issues

mentioned in the exit interview are addressed. It is important for each organization to customize its own exit interview in order to maintain the highest levels of survey validity and reliability.

Lockout:
A lockout is a temporary work stoppage or denial of employment during a labor dispute initiated by the management of a company. This is different from a strike, in which employees refuse to work. It is usually implemented by simply refusing to admit employees onto company premises, and may include actions such as changing locks and hiring security guards for the premises. Other implementations include a fine for showing up, or a simple refusal of clocking-in on the time clock.

Layoff:
Layoff is the temporary suspension or permanent termination of employment of an employee or (more commonly) a group of employees for business reasons, such as when certain positions are no longer necessary or when a business slow-down occurs. Originally the term layoff referred exclusively to a temporary interruption in work, as when factory work cyclically falls off.

The Industrial Disputes Act, 1947

An Act to make provision for the investigation and settlement of industrial disputes, and for certain other purposes.

Citation

Act No. 14 of 1947

Enacted by

Parliament of India

Date enacted

11 March 1947

Date assented to

11 March 1947

Date commenced

1 April 1947

Industrial Disputes Act of 1947

The Industrial Disputes Act, 1947 extends to the whole of India. It came into force April 1, 1947. The objective of the Industrial Disputes Act is to secure industrial peace and harmony by providing machinery and procedure for the investigation and settlement of industrial disputes by negotiations. Various studies indicate that Indian labor laws are highly protective of labor, and labor markets are relatively inflexible. These laws apply only to the organized sector. Consequently, these laws have restricted labor mobility, have led to capital-intensive methods in the organized sector and adversely affected the sectors long-run demand for labor. Labor being a subject in the concurrent list, State-level labor regulations are also an important determinant of industrial performance. Evidence suggests that States, which have enacted more pro-worker regulations, have lost out on industrial production in general. The Industrial Disputes Act (IDA) of 1947. Particular attention has been paid to its Chapter V-B, introduced by an amendment in 1976, which required firms employing 300 or more workers to obtain government permission for layoffs, retrenchments and closures. A further amendment in 1982 (which took effect in 1984) expanded its ambit by reducing the threshold to 100 workers. It is argued that since permission is difficult to obtain, employers are reluctant to hire workers whom they cannot easily get rid of. Job security laws thus protect a tiny minority of workers in the organized sector and prevent the expansion of industrial employment that could benefit the mass of workers outside. It is also argued that the restriction on retrenchment has adversely affected workplace discipline, while the threshold set at 100 has discouraged factories from expanding to economic scales of production, thereby harming productivity. Several other sections of

the IDA allegedly have similar effects, because they increase workers bargaining strength and thereby raise labor costs either directly through wages or indirectly by inhibiting work reorganization in response to changes in demand and technology. The Act also lays down 1. The provision for payment of compensation to the workman on account of closure or lay off or retrenchment. 2. The procedure for prior permission of appropriate Government for laying off or retrenching the workers or closing down industrial establishments 3. Unfair labor practices on part of an employer or a trade union or workers.

Retrenchment/Downsizing:
Downsizing is defined as the "conscious use of permanent personnel reductions in an attempt to improve efficiency and/or effectiveness". Since the 1980s, downsizing has become increasingly common. Downsizing is being regarded by management as one of the preferred routes to turning around declining organization, cutting costs, and improving organizational performance, most often as a cost-cutting measure.

The Plant Closing Law in the United States

The term "plant closing" means the permanent or temporary shutdown of a single site of employment, or one or more facilities or operating units within a single site of employment, if the shutdown results in an employment loss at the single site of employment during any 30-day period for 50 or more employees excluding any parttime employees.

The Worker Adjustment and Retraining Notification Act of 1988 (WARN Act) is a United States labor law which protects employees, their families, and communities by requiring most employers with 100 or more employees to provide sixty- (60) calendarday advance notification of plant closings and mass layoffs of employees. In 2001, there were about 2,000 mass layoffs and plant closures which were subject to WARN advance notice requirements and which affected about 660,000 employees. Employees entitled to notice under the WARN Act include managers and supervisors, hourly wage, and salaried workers. The WARN Act requires that notice also be given to employees' representatives (i.e. a labor union), the local chief elected official (i.e. the mayor), and the state dislocated worker unit. The advance notice gives workers and their families transition time to adjust to the prospective loss of employment, to seek and obtain other employment, and, if necessary, to enter skill training or retraining programs that will allow these workers to successfully compete in the job market.

Layoff and Downsizing Alternatives:

Generally speaking, an organization that decides to eliminate redundant employees does so by using four broad strategies: attrition, voluntary termination, compulsory termination ,across-the-board cuts and early retirement incentives. . 1. Attrition, in which firms do not replace a person who leaves, is the simplest method. With this approach, employees have the opportunity to exercise free choice in deciding whether to stay or leave, and thus the potential for conflict and feelings of powerlessness is minimized. At the same time, however, attrition may pose serious problems for management, because it is unplanned and uncontrollable.

2. Voluntary termination, which includes buy-out offers, is a second approach to downsizing a workforce. The main advantage of a buy-out is that it gives employees a choice, which tends to reduce some of the stigma associated with the loss of a job. The buy-out plans recently offered by Ford Motor Company and General Motors are typical. At Ford, offers ranged from $35,000 for workers with 30 or more years of service, who could keep their full retiree benefits, to a flat payment of $100,000 to younger workers who agreed to leave the automaker and to give up retiree health care and Ford pensions. For workers who chose to go to college or vocational school for four years, Ford provided tuition, half their usual pay and full medical coverage. Workers who chose this plan could keep any accumulated pension but had to leave behind any retiree health benefits. Almost half of Fords hourly production workers (38,000 workers) took one of the offers. At GM, 35,000 workers accepted checks ranging from $35,000 to $140,000 to retire early. Another 12,600 employees at GMs former parts unit, Delphi, did the same, helping the automaker slash $5 billion in costs. 3. Early retirement incentives (ERI), in which a company offers more generous retirement benefits in return for an employees promise to leave at a certain time in the future, is a third downsizing strategy and one that is often part of a larger buyout scheme. Sometimes, early retirement offers are staggered to prevent a mass exodus. Retention bonuses with different quit dates may be used to ensure an orderly exit. From an organizational viewpoint, managers assume that early retirement opens up promotional opportunities for younger workers, but one research study found that it is difficult to predict accurately how many older workers will take an ERI. Typically, about one-third of those offered ERIs accept them, but there is a great deal of variation.12 On the positive side, poor performers are more likely to take ERIs because they lack confidence about future pay increases.

4. Compulsory termination, in which departing employees are given no choice, is the final downsizing strategy and is typical of plant closures and the wholesale elimination of departments or business units. Although it is, of course, unappealing to employees, the managers who make the decisions do have the opportunity to design and implement criteria based on the needs of the business. Eliminating jobs or entire business units also makes it less likely that employees will prevail in lawsuits alleging discrimination. 5. Across-the-board cuts in every department are perhaps the least effective downsizing option. Such cuts emphasize standardized treatment of employees, but ignore the strategic importance of different departments to a firms overall success and ignore different performance levels of employees. Suppose one department is comprised of superstars, and another is comprised of slackers. Why should the same percentage of superstars and slackers be laid off?

Adjusting to Downsizings and Mergers:

Firms usually downsize to improve their financial positions. Yet many firms discover profits dont improve after major personnel cuts. Low morale among those remaining is often part of the problem. It therefore makes a sense to think through how the firm is going to reduce the surviving employees uncertainty and boost their morale. For this there should be full staff meeting at the facility; an immediate follow-up in which remaining employees split into groups with senior managers to have their questions answered; and long term support, for instance, by encouraging supervisors to encourage an open-door atmosphere.

Merger Guidelines: In terms of dismissal, mergers and acquisitions are usually onesided. In such situations following rules should be adopted: Avoid the appearance of power and domination. Avoid win-lose behavior. Remain businesslike and professional in all dealings. Maintain as positive a feeling about the acquired company as possible. Remember that the degree to which your organization treats the acquired group with care and dignity will affect the confidence, productivity, and commitment of those who remain.