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Termination of employment is one of the inevitable features of any employment contract. The decision to end an employment contract requires the employer and the employee to carefully consider the effects of such an action since it affects the strategic plans of an organization and may lead to serious problems with the retrenched employees (Currie, 2008).
This report highlights the termination approach used by Prime Telecoms. The report also looks at the differences between fair and unfair dismissals, exit interviews, and the stages used in managing redundancies.
Termination Approach Used by Prime Telecoms
Prime Telecoms uses a termination approach that entails constructive dismissal. This approach requires the organization to observe all the provisions of the employment contract and communicate the initiative to terminate the contract to the employee as a statutory requirement of labor laws and organizational practices.
It also follows the principles of fair dismissal where the reasons for the termination of employment are identified prior to the process. For instance, termination of employment due to the gross misconduct of an employee must follow the laid down procedures (Daniels, 2006).
Depending on the seriousness of the misconduct committed by the employee, such as sexual harassment, theft, assault or use of inappropriate language, the employee is given a chance to be heard during the interview after which the human resource manager can determine whether it is appropriate to suspend, dismiss or retain the employee.
In cases where the offense is very serious the employee may not be retained at work since Prime Telecoms is forced to terminate their contract. Once the employee’s contract is terminated, the employee is entitled to a one month’s advance salary as the contract is terminated in lieu of a one month’s notice (Currie, 2008).
Fair and Unfair Dismissals
In fair dismissal the employer acts in good faith when terminating the employment contract while the employer follows the right procedures and applies the provisions of the law governing employment contracts. For example, when Prime Telecoms applies fair dismissal in situations of redundancy, the organization conducts performance reviews and evaluates the requirements of the job against the skills, knowledge, and expertise of the employee.
Fair dismissal ensures the organization communicates the results of the review to the employee and highlights the identified gaps. The next stage is the communication process where the organization and the employee discuss gaps. Finally, the organization communicates the intent to terminate the contract to the employee.
Unlike in fair dismissal where the employer informs the employee of the intent to terminate their contract, unfair dismissal does not entail any form of communication between the two parties. It also does not give room for a proper investigation to identify the issues that are associated with the problem at hand. For example, an organization may dismiss an employee for taking part in a strike organized by a trade union.
Furthermore, some organizations deny their employees statutory rights to participate in trade unions and therefore may dismiss employees on such grounds since they are perceived as potential threats to the organization, and may be terminated without any proper communication (Daniels, 2006).
Benefits of Exit Interviews
Regardless of the termination approach used by the parties, exit interviews play an important role during the termination process. They provide an opportunity for an organization to reduce labor turnover and enhance employee retention.
They also provide an opportunity for the human resource department to improve their practices and functions as an organization can use information extracted during the interview to improve human resource planning and training needs of the employees (Currie, 2008). The information can also be used by the exiting employee to identify personal areas of improvement such as knowledge and skill advancement (Daniels, 2006).
Major Steps in Managing Redundancies
Redundancies occur when the employer or the employee ceases or plans to cease the business with either party. The major steps involved are planning, consultation, selection, provision of redundancy payments and conclusion (Daniels, 2006)
The organization should first make sure that all the employees are informed of a redundancy situation in time, after which the management invites all employees to consultations and exchange of ideas as they select the exact areas that are redundant. Redundancy payment is expected to be made to all employees who have worked for the organization for a period of more than two years after the selection, before a conclusion is made on whether the employees are dismissed or the organization shuts down.
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The management should avoid redundancy by ensuring that the number of employees is in line with the size of the required workforce at all times and jobs assigned to maximize the employees’ potential.
Currie, D. (2008). Introduction to Human Resource Management. London, UK: CIPD.
Daniels, K. (2006). Employee relations in an organizational context. London, UK: CIPD.