642+ Lawyers are online 
Industrial Disputes Act Section 25FF and 25G applicability
14-Jul-2023 (In Labour & Service Law)
Hello, Earlier our company was 60% Foreign (US company) owned & 40% Indian Employee owned in the form of shares. Now, we sold our 40% shares to US company making the US company 100% owner (I guess change of management). As soon as this transfer was almost over,the company started mass retrenchment.Very senior persons were retrenched. Nobodys knows what criteria are being followed.In one day almost 120 employees were laid off with proper retrenchment benefit and all dues. My question 1) is this legally possible as per ID act 25FF, werein new employer can retrench additional workforce anyone as restructuring measure.They are going to give new Roles. 2) In such cases does Rule of 25G Last come first go apply during such transaction. I think company has to consider the seniority of employee 3) If a person is being retrenched then its necessary to give him valid reason as per employment contract, if not given his retrenchment is void...correct...? Thanks for reply in advance
25G. Procedure for retrenchment.- Where any workman in an industrial establishment, who is a citizen of India, is to be retrenched and he belongs to a particular category of workmen in that establishment, in the absence of any agreement between the employer and the workman in this behalf, the employer shall ordinarily retrench the workman who was the last person to be employed in that category, unless for reasons to be recorded the employer retrenches any other workman.
25FF. Compensation to workmen in case of transfer of undertakings.- Where the ownership or management of an undertaking is transferred, whether by agreement or by operation of law, from the employer in relation to that undertaking to a new employer, every workman who has been in continuous service for not less than one year in that undertaking immediately before such transfer shall be entitled to notice and compensation in accordance with the provisions of section 25F, as if the workman had been retrenched: Provided that nothing in this section shall apply to a workman in any case where there has been a change of employers by reason of the transfer, if--
(a) the service of the workman has not been interrupted by such transfer;
(b) the terms and conditions of service applicable to the workman after such transfer are not in any way less favourable to the workman than those applicable to him immediately before the transfer; and
(c) the new employer is, under the terms of such transfer or otherwise, legally liable to pay to the workman, in the event of his retrenchment, compensation on the basis that his service has been continuous and has not been interrupted by the transfer.
25FF. Compensation to workmen in case of transfer of undertakings.- Where the ownership or management of an undertaking is transferred, whether by agreement or by operation of law, from the employer in relation to that undertaking to a new employer, every workman who has been in continuous service for not less than one year in that undertaking immediately before such transfer shall be entitled to notice and compensation in accordance with the provisions of section 25F, as if the workman had been retrenched: Provided that nothing in this section shall apply to a workman in any case where there has been a change of employers by reason of the transfer, if--
(a) the service of the workman has not been interrupted by such transfer;
(b) the terms and conditions of service applicable to the workman after such transfer are not in any way less favourable to the workman than those applicable to him immediately before the transfer; and
(c) the new employer is, under the terms of such transfer or otherwise, legally liable to pay to the workman, in the event of his retrenchment, compensation on the basis that his service has been continuous and has not been interrupted by the transfer.
Helpful?
26+
26+
Adv. Siddhant Sharma
Delhi | 500+ Answers
Chat
Disclaimer: The above query and its response is NOT a legal opinion in any way whatsoever as this is based on the information shared by the person posting the query at lawrato.com and has been responded by one of the Divorce Lawyers at lawrato.com to address the specific facts and details.
Connect with top Labour & Service lawyers for your specific legal issue
No Comments! Be the first one to comment.
"lawrato.com has handpicked some of the best Legal Experts in the country to help you get practical Legal Advice & help."
