Termination of Contracts

 

 

The final role of the H.R.M. department is to make the termination of the employees' contracts of employment as smooth and efficient as possible. There are a number of different ways in which employees can have their contracts of employment terminated, including:

 

1. Redundancy. It will be necessary at certain times (e.g. during a recession, or a decline in the industry) for a business to 'downsize' its workforce (make a certain proportion of them redundant).

 

This process could be done in several ways, voluntary redundancy (where workers opt for a redundancy package), compulsory redundancy, 'last-in-first-out' (where the most recent appointments are the first to be made redundant), or retention by merit (where the least effective employees are made redundant).

 

2. Retirement. At the end of their working-life, employees will wish to retire and stop offering their services to the business. In return, they will often receive a lump-sum payout, as well as both their state pension and their private pension.

 

3. Transfers and Resignation. This occurs when an employee leaves the business and transfers their services to another business (the employee may apply for a more senior job at another business).

 

4. Dismissal. This is where the employee is deemed to have broken their contract of employment, and told that their services are no longer required by the business. Fair dismissal can be on the grounds of sexual harassment, racial harassment, bad timekeeping, sleeping on the job, and destruction of business property.

 

However, if an employee feels that they have been unfairly dismissed (e.g. on the grounds of pregnancy, ethnic background, or union membership), they can apply to have the case heard at an industrial tribunal.

 

This is a small court that deals with claims of unfair dismissal and discrimination from employees against their (former) employers. If the employee is successful in claiming that they have been unfairly dismissed, then they are eligible for re-instatement in their previous job, as well as a financial award (to cover loss of earnings, and pain and suffering).