Employee Dismissal: Comparing The Legal Basis For Staff Dismissal In Indian And EU

Employee Dismissal: Comparing The Legal Basis For Staff Dismissal In Indian And EU

Tisha Roy


This Blog is written by Tisha Roy from NALSAR University of Law, HyderabadEdited by Pranoy Singhla.



Dismissal of an employee can be generally understood as the process of termination from the employment by the employee against the desire of the employee.

Employment law deals with the relationship between employee and employer. It is more concerned with the way of working of the employees, working conditions, working hours, termination etc.


The relationship between employer and employee is old and has been very visible since industrial revolution. Employee has mostly been exploited and dominated by employer.

So, the labour and employment laws were made to provide social justice and welfare to the workers. These laws exist to ensure about the safety and security of the employees, to provide them favourable environment at the work space and a legal remedy for unjust treatment.

Employers used to terminate the employees against their will without even citing any reason. This lead to development of termination laws under which, the termination needs to be just and fair and unjust termination would lead to legal action to provide remedy to employee for the loss suffered.



• The Basic Conditions of Employment Act, popularly called BECA is regulated by the government with the aim to protect the employees from exploitation by the employers. It lays down the regulations which should be followed by the employers. Other important provisions includes prohibition of employment of any person who is below the age of 15 years and verification of age of the employee, matters in realtion  to working hours of the staff, medical leaves, termination terms and process etc.

• Employment Equity Act is laid down to make sure of equity at workplace, promoting equal opportunities with fair treatment by removal of unjust treatments and discrimination. The act also aims to address and resolve the problems faced by the employees. It looks forward to treat employees fairly and ensure that their delegation is according to skills and merit.

• In India, no specific procedure is laid down for the termination of an employee. The terms and conditions regarding termination of employee are generally based on the contract done between employee and employer. But there are labour laws and contracts which always supersede over the specific contract. In cases where labour contracts are absent, then state acts will be given priority.

• According to Indian Labour Law, an employer is defined as an establishment or factory, on the other hand, an employee is either an employee or workman. Both centre and state government govern the employment guidelines and lay down the provisions. Industries Disputes Act of 1947 and Industrial Employment (Standing Orders) Act of 1946 are with the aim to regulate and control the termination process of employees. The Shops and Establishments Act is consisted by most of the states with little changes in implementation rules employment in all premises where business, profession and trade are carried out are regulated under this act.

There are several grounds for termination of an employee as per the laws enacted. These grounds are as follows:

• In case of superannuation or retirement

• When fixed term is expired

• Due to mutual separation

• In case of resignation by the employee

• Layoffs

• Termination for cause which is involved in various cases:

  • When the employment contract or nay internal policy is breached
  • Involvement of employee in any criminal offence
  • In case of misconduct
  • Poor performance of employee
  • There is no confidence on employee
  • Continuous Absenteeism

Under Industrial Disputes Act of 1947, notice period of 30 to 90 days of should be given to terminate “workman”. In case of ‘termination for convenience ‘approval from the government is needed for manufacturing plants, units and mines where more than 100 workmen are working. For other sectors Government notification is enough.

Reasons which can be considered for the termination under Indian Labour Law are as follows:

  • wilful rebelliousness or disobedience
  • theft, fraud, or dishonesty
  • intentionally damage or loss of employer’s goods
  • taking of bribes or any illegal gratification
  • absent without leave for more than 10 days
  • late attendance
  • disorderly behaviour during working hours
  • negligence of work

A non-compete agreement cannot be enforced at all while non- solicitation clauses can be enforced in certain limited. It is stated in the Indian copyright regime that employees must be provided with a formal assignment as per the principle of ‘work and hire’.

Under Maternity Benefit (Amendment) Act, 2017, if a pregnant or a woman seeking for maternity leave is being terminated then in that case the employer must balance her convenience against the risk associated with noncompliance.

There are state enacted laws such asDelhi Shops and Establishments Act of 1954, The Karnataka Shops and Establishments Act, 1961 and the Tamil Nadu Shops and Establishments Act, 1947.

2. EU

• The employment law of European Union protects the rights of workers and employees across the EU. But generally, in different member state these operate differently. So the process works like that at first these laws are enacted at the level of EU and then each member state implements it as national law.

• Article 153 of The Functioning of European Union states that the Union will support the activities of member states in ‘protection of workers where their employment contract is terminated’.

• Article 30 of the Charter of Fundamental Rights of EU talks about ‘Protection in the event of unjustified dismissal’. Article 24 of Revised European Charter talks about ‘the right to protection in cases of termination of employment’. Its basic rules include:

  • When a worker is dismissed without any valid reason then he shall have the right to protection.
  • What will be called as dismissal without any valid reason must be mentioned in a source which is binding.
  • When a worker is dismissed he has the right to know the reason of dismissal to do the evaluation whether that reason is justified or not
  • Every work must have right to appeal
  • If the worker is dismissed without any valid reason then compensation should be given for the loss and relief.

Some of the countries have rules constituted on the burden of proof. Most of the countries also have enough and appropriate sanction against unfair dismissal by offering a choice between financial compensation and reinstatement. These countries even recognised the principle of notice period and provide for social security and severance allowances in the case of unemployment.


In the end, by studying both Indian legislations and laws in EU, it can be said that there are measures to protect the rights ion employees. Comparing the saturation, India has more laws and measure to protect the employees from unjust dismissal and have more clear guidelines on ground so f termination. Specific provisions are there is India on dismissal of employees. Since this matter of employment is part of concurrent list, both centre and sate enact laws on employee dismissal and remedies. Laws in EU are rather general and specific grounds and guidelines are absent from it. The functioning and implementation is very different as India is a country while EU as its name suggest is union of 27 member states.

Though state in India make laws at their level but they are part of one country and functions in this way but EU has different case scenario where at first EU passes a law and then nations implement at their level in their own way. Some of the EU members don’t have consensus on specific provisions and like to deal in certain way making it difficult to implement same law in all 27 member countries.

It has also been observed that there are fewer rules on dismissal of employee in EU such as what are the exact grounds of dismissal. In the charter, it is only mentioned that there is need to protect employees but exact legal and social remedies are absent from the scene. In India, specific grounds are laid down making it easier to interpret and implement.

More than laws and statutes, EU is dependent upon charters and treaties making it less effective in the practical scenario.

Despite the differences in the approach , both EU and India have the same goal to protect the employees and this aim is now new, it have been from quite a few time but both recognise the need for measure to provide a sense of security to the employees.


Employment laws and protection acts holds a very significant position as they are shield to protect the rights of the employees and from the exploitative practices of the employers. These laws decrease the dispute and exploitation of workmen and employees. These laws gave a foundation to the employee to rely on them to get justice and live a dignified life. In the absence of these laws, employers will be free to do unjust behaviour. The employers would have dominated them and have exploited them beyond imagination for their selfish motives.

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