Termination of Employment under Labour Act 2006
by Miss Makama Mahmuda
In Bangladesh, employment of a worker can be terminated either by the employer or the worker. There are various procedures under which it takes effect. The detailed process of termination of employment is discussed and described under sections (20-31) of the Labor Act 2006.
Retrenchment due to redundancy:
As per Section 20 of the Act, in case of redundancy, any worker can be retrenched from the company. To retrench a worker who is working in the company for at least one year, 30 days notice must be given to the concerned worker. In addition, the worker is entitled to receive compensation at the rate of 30 days of wages for each completed year of service. It is to be further noted that as per section 21, where any worker is retrenched, and employer intends to appoint new worker within one year, the employer shall send a notice to the last known address of retrenched worker asking him to apply for re-employment. If there is more than one retrenched worker, preference shall be given on the basis of their seniority in the previous service.
Discharged due to medicinal incapacity:
Under section 22, a worker may be discharged from service due to physical or mental incapacity as certified by a registered medical practitioner. If a discharged worker has completed one year of continuous service, his employer shall pay 30 days wages as compensation for his every completed year of service.
Dismissal due to misconduct:
Section 23 discusses the punishment for misconduct and conviction. The punishment is given to a worker for misconduct and conviction. Retrenchment, discharge, termination of service, a worker may be dismissed without notice or wages in lieu of notice if he is doing any criminal offence, found guilty of misconduct.
A worker found guilty of misconduct may be awarded of the punishment instead of being dismissed like:
- Reduction to a lower post.
- Stoppage of promotion for a period not exceeding one year,
- Withholding of increment for a period not exceeding seven days
The Act shall be treated as misconduct, namely:
- Willful disobedience whether alone or combined with others to any lawful order of a superior.
- Theft, fraud, dishonesty
- Habitual absence without leave or without obtaining leave, absence for more than ten days.
- Habitual late attendance.
- Habitual breach of any law, rules and regulation.
- Habitual negligence in work.
- Altering, wrongfully changing, damaging or causing loss to employer’s official records.
If a dismissed worker is acquitted on appeal, he shall be reinstated to his original post or shall be appointed to a suitable position. If either is not possible, he shall be paid compensation.
In case of an allegation of misconduct, a committee has to investigate the matter, and the concerned worker needs to be show caused and allowed to defend himself. It should be noted that in the case of a criminal conviction or if the worker is guilty of misconduct, a worker can be terminated without notice.
There are some procedures of punishment
As per section 24, No order of punishment shall be made against a worker unless the allegation against him is recorded in writing, he is given a copy of allegation and at least seven days is given to explain, he is given the opportunity of hearing. No order of punishment shall be made against a worker unless the worker is found guilty after an enquiry made by enquiry committee consisting representatives of employer and the worker and such enquiry shall be concluded within 60 days. The employer or the manager approves the order of dismissal if punishment is not made against a worker. A worker charged for misconduct may be suspended pending an enquiry into charge unless the matter is pending before any court, and such suspension shall not exceed 60 days. But during the period of such suspension, a worker shall be paid by his employer, and he shall get an allowance in full. An order of suspension shall be in writing and shall take effect immediately on delivery to the worker. In the case of awarding punishment, a copy of the order of punishment shall be supplied to the worker concerned.
As per section 25, the special provision relating to fine is, no fine exceeding one-tenth of wages payable to a worker in a wage period shall be imposed on any worker. No fine shall be imposed on a worker who in underage of 15 years. No fine imposed on worker shall be recovered by instalment or after the expiry 60 days from the date on which it was imposed. An employer shall record all fine in a register prescribed by rules.
Termination without Cause
Section 26 allows an employer to terminate the employment of a worker for convenience. Under this Section, employment of a permanent worker can be terminated by an employer by giving him a notice in writing of 120 days if he is a monthly rated worker and 60 days in case of another worker. Additionally, it is impracticable to give the worker notice; an employer can may compensation in lieu of the notice. In case of such termination, a worker must receive compensation at the rate of 30 days wages for each completed year of service or gratuity, whichever is higher.
Resignation by worker
As per section 27, a permanent worker may resign his service by giving 60 days notice in writing the employer. On the other hand, a temporary worker may leave his service by giving 30 days notice in writing if he is a monthly rated worker and 14 days notice in writing in case of other workers. But where a worker intends to resign his service without any notice, he may do by paying the employer an amount equal to the wages for the period of notice.
Section 28 discusses “retirement of worker”. A worker shall retire from employment on the completion of 60 years of his age, and every retiring worker shall be paid all the dues. To count age of worker, the date of birth recorded in the service book of that worker shall be the conclusive proof. Any authority may employ on a retiring worker under contract if it thinks fit.
Under section 28, if for a natural disaster or any other disaster which is beyond human control, any industry is shifted, or any sector is permanently closed, the government may determine the employer and worker relations in such manner as may be prescribed by rules.
As per section 29, if a worker is a member of any provident fund and is entitled to any benefit from such fund including employer’s contribution. He shall not be deprived of the benefit due to retrenchment, discharge, dismissal, retirement, removal or termination of service.
Where a worker ceases due to retirement, discharge, retrenchment, dismissal, termination or any other reason, all amounts due to him shall be paid by appointing authority within a maximum period of 30 working days.
Lastly, under section 31, every worker shall be entitled to get a certificate from his employer relating to service at the time of retrenchment, discharge, termination of service.
Hopefully, in the aforesaid discussion, anyone can understand about retrenchment and its prescribed procedures.