Govt sets retrenchment rules to secure better treatment for employees

GANGTOK, 18 April: Employees, especially if they are local to Sikkim, working in private companies including power projects here cannot be terminated from service as casually as has been the case thus far. Companies here can no longer retrench staff without liabilities.
The state government, through a notification issued by the Department of Labour recently, has decreed that private companies including power projects, industrial establishments, pharmaceutical companies, public and private sector companies and undertakings in the state, have to adopt a procedure, as provided by the state, when it comes to termination or retrenchment of workers.
Numerous industrial units and power projects have come up Sikkim in the recent years and have been employing a large number of locals as well as people from outside the state who, till date, had no job security and could be terminated or retrenched at any time by the industrial unit or company.
Now, the State government has ruled that the private sector needs to adopt a proper retrenchment procedure which requires the company to serve a three months notice in writing indicating reasons for retrenchment. The retrenchment can take place only on the expiry of the three months or of the retrenched worker is provided three months wages in lieu of the time. In addition to this, at the time of retrenchment, compensation equivalent to 15 days average pay for every completed year of continuous service is also to be paid to the workers.
In another significant step taken by the state government concerning people working in the private sector, the employers are now required to provide employment to the next of kin of employees who die in harness.
In this regard, the Memorandum of Understanding issued in the year 2010 to be executed by investors has been amended to include a clause which states that “in case of death of an employee/ worker of the company during his/ her service period, one of the eligible family members of the deceased employee/ worker who dies in harness shall be considered for compassionate appointment by the unit.”