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When an organization decides to terminate its employees in certain number on any circumstances it needs to select the employees with valid reasons

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When an organization decides to terminate its employees in certain number on any circumstances it needs to select the employees with valid reasons. The service of any of the following employee can be terminated:

• Dismissal for any disciplinary action
• Poor Performance
• Contract termination
• VRS - voluntary retirement service ( golden handshake)
• actual retirement attaining age as per the government norms
• termination based on disablement

if at all there's no possibility to find any of the stated reason and still the organization wants to terminate its employees with reduces its unwanted cost by downsizing, then it can use Last In First Out rule.

As a payroll Supervisor of a company, It is essential to consider the compensation for the employees in case of termination. The amount of compensation differs according to a different factor.

• Gratuity - In case, the employee is eligible. (If the employee has worked for 5 years or more) for gratuity calculation (15/26) x no. of service year x last drawn salary
• for VRS, Contribution to any pension fund or Provident fund the employee was entitled.
• In the case of total disablement - a lump sum of money according to the workmen compensation act or 60% of monthly wage x relevant factor with age reference.
• For Contract Termination, the compensation will be provided by the contractor to the employee
• In the case of Last In First Out rule is applied, retrenchment compensation
• any reimbursement of expenses allowed by the nature of work

Deductions from the Employees by the employer can be the following:

• Fine - for damaging any organization property, incurring a loss by intentional activities, disciplinary action
• Recovery of loan
• absence from area engaging the employment
• advances paid before the employment
• recovery of co-operative society schemes or insurance schemes
• any services provided in the course of employment