What are the procedures for terminating an employee hired through an EOR?

Table of contents

Terminating an employee hired through an Employer of Record (EOR) requires careful attention to legal requirements, documentation, and proper procedures to ensure compliance with local labor laws while maintaining professionalism throughout the process.

Understanding Termination Procedures

When terminating an employee through an EOR, the process typically involves collaboration between your company and the EOR provider. The EOR handles the legal and administrative aspects while you maintain control over the business decision to terminate.

Initial Steps Before Termination

Before initiating the termination process, you should:

  1. Review the employment contract and company policies
  2. Document the reasons for termination thoroughly
  3. Consult with the EOR regarding local legal requirements
  4. Prepare necessary termination documentation

Legal Compliance and Documentation

The EOR ensures compliance with local labor laws during the termination process. This includes:

  • Adherence to notice period requirements
  • Calculation of final settlements
  • Processing of mandatory benefits
  • Management of severance payments
  • Compliance with local termination regulations

Types of Termination Scenarios
Termination Type Notice Period Documentation Required
Performance-based As per contract Performance reviews, PIPs
Voluntary resignation 1-3 months typical Resignation letter
Misconduct Immediate possible Incident reports
Redundancy 1-3 months typical Business case documentation

Communication Protocol

The termination process should follow a structured communication approach:

  1. Initial consultation with EOR
  2. Formal documentation preparation
  3. Employee notification meeting
  4. Written confirmation of termination
  5. Team communication planning

Final Settlement Process

The EOR manages the following aspects of final settlement:

  • Calculation of final salary
  • Processing of unused leave encashment
  • Statutory bonus payments
  • Gratuity calculations (if applicable)
  • Tax compliance and documentation

Post-Termination Procedures

After termination, several important steps must be completed:

  1. Asset Recovery
  • Company equipment return
  • Access revocation
  • Security clearance closure
  1. Documentation Completion
  • Exit interviews
  • Clearance certificates
  • Experience letters
  • Full and final settlement

How Wisemonk Can Assist You with Terminating an EOR Employee

As a leading EOR provider in India, Wisemonk can make the termination process smooth and legally compliant by managing each stage of the termination. From initiation to post-termination support, Wisemonk’s EOR services guide you through each step, ensuring adherence to local labor laws and protecting your organization from legal risks. Wisemonk’s team of payroll and HR professionals handles everything—from preparing termination documents to managing employee benefits and compliance, making employee offboarding seamless, compliant, and respectful of all parties involved.