Introduction
The question of whether an employee can be terminated during a pending Prevention of Sexual Harassment (POSH) investigation is of legal and procedural significance. The definitive legal position is that termination is a final disciplinary measure that can only be lawfully executed after a complete and fair inquiry has concluded and a finding of guilt has been established. Terminating an employee who is the subject of an ongoing investigation is a procedural error that violates the fundamental principles of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (“POSH Act”).
Such action is not only legally indefensible but also exposes the organisation to a dual threat of litigation. The accused employee can challenge the termination as wrongful, arguing a violation of due process. Simultaneously, the complainant can file a separate legal claim, asserting that the organisation’s action was a form of retaliation and victimisation, which is itself a violation of the POSH Act. To handle such substantial legal and reputational risks, it is imperative for employers to empower a well-trained Internal Committee (IC) to conduct a time-bound inquiry and to act only upon the final recommendations of that committee. The due process prescribed by law is not an optional step; it is the organisation’s primary defence against future legal and financial liability.
Workplace Safety & the POSH Act
The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, commonly known as the POSH Act, is a landmark statute. The Act is not merely a set of rules; it is a legislative embodiment of constitutional principles, safeguarding a woman’s fundamental rights to equality, non-discrimination, and the right to life with dignity, as stated in Articles 14, 15, and 21 of the Indian Constitution. The primary purpose of the law is to create safe and secure working environments, thereby enabling women to pursue their professions and livelihoods free from fear and intimidation.
The Mandate and Powers of the Internal Committee (IC)
The Act mandates that every employer with ten or more employees is legally obligated to constitute an IC to receive and address complaints of sexual harassment. This is not a suggestion but a mandatory legal requirement, and failure to comply can lead to significant penalties. The composition of the IC is defined by law to ensure fairness and impartiality.
It must include a senior woman employee who serves as the Presiding Officer, at least two (02) other employee members with a commitment to women’s causes or legal knowledge, and, an external member from an association or an NGO committed to the cause of women. The presence of this external member is a deliberate legal mechanism designed to prevent “institutional bias” and ensure that the inquiry process is objective and free from internal pressures, especially in cases involving senior personnel. The law further dictates that at least half of the total IC members must be women to maintain a gender-balanced perspective.
The Investigation Process: A Step-by-Step Guide
The POSH Act prescribes a detailed and time-bound procedure that the IC must follow with precision. The integrity of any disciplinary action, including termination, hinges entirely on the IC’s diligent adherence to this process. Here are some of the key points:
- The procedure begins with the receipt of a written complaint, followed by the constitution of a quorum from the IC members.
- The complainant is then formally acknowledged and provided with a summary of their rights and potential interim measures.
- Subsequently, the official complaint is forwarded to the respondent, who is given a fair opportunity to provide their response and present their side of the story within a specified timeframe.
- The IC then proceeds to gather and study evidence, which includes conducting sensitive and confidential interviews with the complainant, respondent, and any witnesses.
- Throughout this entire process, a comprehensive documentation of all proceedings is non-negotiable for future transparency and reference.
- The final step is for the IC to analyse the evidence and arrive at a decision, which is then formally documented in a comprehensive final report with findings, conclusions, and recommendations.
The Burden of Proof
A fundamental aspect of the POSH inquiry is its standard of proof. The proceedings are not a criminal trial, and the burden of proof is not “beyond a reasonable doubt”. Instead, the IC operates under the civil law standard of “preponderance of probability”.
This means the IC must determine if the alleged incident is more likely to have occurred than not, which is a probability of greater than 50%. This standard acknowledges that in cases of sexual harassment, tangible evidence may be scarce, and the IC must often rely on a careful evaluation of circumstantial evidence, witness testimonies, and the inherent facts of the case. While this standard is less stringent, it in no way diminishes the IC’s duty to conduct a thorough and objective investigation. It simply allows for a conclusion to be reached in the absence of absolute, irrefutable evidence, relying instead on a reasoned assessment of all available information.
Suspension vs. Termination During an Inquiry
The legal framework of the POSH Act creates a clear and critical distinction between temporary, protective measures and final, punitive actions. Conflating these two concepts is a primary source of legal risk for employers, hence, in the light of this, the following are the key points:
(A) Interim Measures as a Protective Shield
The Act grants the IC the authority to recommend “interim measures” during the pendency of an inquiry. These are temporary actions, not punishments, and their sole purpose is to protect the complainant, prevent further harassment, and ensure the integrity of the investigation. On a written request from the complainant, the IC can recommend a temporary suspension of the accused, a no-contact order between the parties, or a temporary relocation of either the complainant or the respondent to a different workplace.
However, the law views even a temporary suspension as a serious step that should not be taken lightly. It is typically considered a last resort, to be recommended only in cases where the allegations are particularly severe or if the respondent is interfering with the inquiry.The intent behind such a measure is purely protective and procedural, not punitive. It is a temporary safeguard that concludes once the final inquiry is complete.
(B) Termination: A Consequence, Not a Pre-emptive Action
The philosophy of the POSH Act is that “punishment should follow due process and not precede it”. Termination, as the most severe disciplinary action, is a direct consequence of a proven offence, not a pre-emptive response to an allegation. The law mandates that an employer can only terminate an employee after the IC has completed its inquiry, established a finding that the allegations have been proven, and recommended disciplinary action in its final report.
This distinction is not merely a technicality. It represents a fundamental legal chasm. Interim measures are designed for the investigation stage, while termination is an action reserved for the final, post-inquiry stage. Bypassing the entire investigative process to terminate an employee based solely on an unproven allegation is a direct violation of the principles of natural justice and makes the employer’s action legally indefensible.
Comparison of Interim Measures vs. Final Disciplinary Actions
| Feature | Interim Measures | Final Disciplinary Actions |
| Purpose | Protection of the complainant, prevention of retaliation, preservation of evidence | Punishment for a proven violation, deterrence, and enforcement of policy |
| Legal Basis | Section 12 of the POSH Act | Based on IC recommendations, in accordance with service rules |
| Timing | During the pendency of the inquiry | After the IC inquiry is complete and a finding of guilt is made |
| Nature | Temporary, not punitive | Permanent, punitive |
| Examples | Temporary suspension, no-contact order, temporary relocation, leave grant | Written warning, demotion, withholding of increments, monetary fines, termination |
The High Stakes of Pre-emptive Termination (Legal and Financial Risks)
An employer who terminates an employee during a pending POSH investigation invites a cascade of significant legal and financial risks that can extend far beyond the initial complaint. Some of these are mentioned herein:
(A) Retaliation and Victimisation as a Form of Harassment
One of the most severe legal risks is that premature termination can be legally interpreted as retaliation, which is itself a form of sexual harassment under the POSH Act.
Retaliation is defined as punishing a person for asserting their rights, such as filing a complaint or participating in an investigation. The law explicitly states that termination becomes “legally questionable” when a person is dismissed “soon after lodging a harassment complaint” or if the employer “bypassed the Internal Complaints Committee (ICC)”.
This procedural misstep creates a perilous situation for the employer. Not only can the accused employee challenge the termination as wrongful and without due process, but the complainant can also file a new, separate legal claim asserting that the company’s rash action has created an intimidating or hostile work environment. By failing to follow a proper inquiry process, the employer is exposed to legal challenges from both parties involved in the complaint, a double-bind that is easily avoided by simply adhering to the law.
(B) Legal Precedent: The Lessons from Landmark Cases
Indian courts have consistently reinforced the critical importance of due process in matters of sexual harassment. In a case involving a multinational corporation, the dismissal of a senior executive was upheld because the IC’s thorough investigation had meticulously established guilt and recommended the action.
Conversely, in the case of Punita Sodhi v. Union of India (2010) 172 DLT 409, the Delhi High Court set aside a termination order, holding that firing a woman after a complaint without a proper IC inquiry amounted to victimisation. The court concluded that the termination order was “stigmatic and punitive” and violated the principles of natural justice because the employee was not given a proper opportunity to defend herself.
The court’s remedy was not a simple reinstatement but a legal directive allowing the employer to proceed with a fresh disciplinary action, a clear indictment of the procedural failure, not the outcome of the case itself. This landmark judgment serves as a powerful reminder that the process is as important as the final decision, and any deviation from it can render an employer’s actions legally invalid.
Note: A Procedural Imperative (What to Do When the Accused Resigns):
A common misconception is that a POSH investigation becomes moot once the respondent has resigned from the organisation. The legal position, however, is clear and unambiguous: the employer’s obligation to complete the inquiry does not cease with the employee’s resignation. Company policies and legal principles often stipulate that once an investigation has been initiated, it “has to be completed and cannot be stopped“.
An incomplete inquiry, even in the event of resignation, leaves the organisation vulnerable to future claims from the complainant. The employer is legally required to uphold a safe work environment, and this obligation persists regardless of whether an employee remains on the payroll.A failure to complete the investigation means the company does not have a formal, legally sound conclusion to the complaint, nor does it have a record of the findings. This not only undermines the company’s commitment to a safe workplace but also potentially allows a proven harasser to leave without a formal resolution or a mark on their record, potentially posing a risk to future employers. Therefore, to “uphold the principles of fairness, accountability, and workplace safety,” the IC must continue and conclude the inquiry even after a respondent has tendered their resignation.
A Guide to Best Practices
To ensure fairness, legal compliance, and a strong defence (with regard to the POSH Cases) against future challenges, employers must follow a structured playbook of best practices. A step-by-step approach is the only reliable way to manage a POSH investigation. Employers and ICs should follow this checklist (mentioned below herein) as a matter of due process:
- Promptly Receive and Acknowledge the Complaint: A confidential reporting mechanism is essential.
- Constitute a Proper IC Quorum: Ensure the committee is impartial and free from conflicts of interest.
- Issue Formal Notice to the Respondent: Provide a copy of the complaint and allow a fair opportunity for them to reply.
- Gather Evidence: This includes conducting interviews, gathering witness accounts, and collecting circumstantial evidence, all while maintaining confidentiality.
- Ensure a Fair Hearing for Both Parties: Both the complainant and the respondent must be given an equal opportunity to present their case and supporting evidence without bias.
- Document Every Step: Diligently record all proceedings, interviews, and evidence collected. This documentation is the basis of any future legal defence.
- Submit and Disclose the Report: The IC must submit its findings and recommendations to the employer and provide copies of the report to both the complainant and the respondent.
- Act on Recommendations: The employer must act on the IC’s recommendations within 60 days of receiving the report.
The Significant Role of a Competent IC
The effectiveness of a POSH framework is directly tied to the competence of its IC. The law mandates that employers must provide compulsory training for IC members to ensure they are equipped to handle complaints effectively and impartially.
A well-trained IC is better able to examine the legal and procedural complexities, distinguish between genuine allegations and malicious complaints, and avoid making flawed decisions that may not hold up under legal scrutiny. An investment in IC training is, therefore, a strategic investment in legal risk mitigation and a clear signal of the organization’s commitment to fairness.
Timeline of a POSH Investigation
| Procedural Step | Statutory Timeline |
| Filing of Complaint | Within 3 months of the incident or the last incident in a series |
| Completion of Inquiry | Within 90 days of the complaint being received by the IC |
| Submission of Report | Within 10 days of the inquiry’s completion, to the employer/District Officer |
| Disclosure of Report | Within 10 days of the inquiry’s completion, to both the complainant and the respondent |
| Employer’s Action | Within 60 days of receiving the IC’s recommendations |
Note: Throughout the entire process, maintaining strict confidentiality is paramount to protect the privacy of all parties involved. However, this confidentiality is not absolute. While the investigation itself must remain confidential, the final report must be provided to both parties within ten days of its completion to ensure transparency and provide a legal basis for any appeal or further action.
Conclusion
In conclusion, the legal position regarding the termination of an employee during a POSH investigation is unequivocal: it is not permissible. The law provides a clear framework for addressing sexual harassment, a framework that is built on the principle of procedural fairness. Termination is a final disciplinary measure that can only be enacted after a fair, complete, and time-bound inquiry has been conducted by a competent Internal Committee. Any attempt to bypass this process by pre-emptively terminating an employee can lead to severe legal and financial repercussions, including wrongful termination lawsuits, court-ordered reinstatement, and new claims of retaliation.
For an organisation, examining this domain is not just about avoiding legal penalties; it is about demonstrating an unwavering commitment to a safe, respectful, and equitable work environment. By empowering a well-trained IC, adhering to due process, and upholding the principles of fairness and confidentiality, an employer or the said organisation can effectively look into the legal risk while simultaneously creating a culture where every employee feels secure and their dignity is protected. The true measure of an organisation’s commitment to workplace safety lies in its actions, not just in its written policies, but in its unwavering adherence to the legal process when it matters most.
YLCC would like to thank Nikunj Arora for his valuable insights into this article.
