OPINION | Employee Rights Under Siege: Rising Workplace Harassment And Forced Terminations

What we are witnessing is not just traditional layoffs; many employees are being forced to resign due to constructive dismissals because of increasingly hostile work environments.

By Smita C Kapoor

As layoffs surge, specifically in the tech sector and constructive dismissals mount, employees are increasingly turning to courts for protection against hostile work environments.

 

India’s corporate landscape is witnessing a lot of surges in forced terminations. Employee rights are under severe strain due to an increase in layoffs as companies navigate economic pressures through aggressive cost-cutting measures. Investors expect swift results and have little patience for prolonged transitions. Underperformance is not tolerated; employees are quickly replaced, with no room for a cooling-off period. The crisis has intensified with many high-profile layoffs, specifically across the technology sector. Recently, job cuts by major tech firms have sparked widespread concern about the methods employers are using to reduce the workforce.

 

What we are witnessing is not just traditional layoffs; many employees are being forced to resign due to constructive dismissals because of increasingly hostile work environments. This is emerging as a dominant trend. According to a research firm, Exechange.com, 74 out of 191 CEOs who departed their roles this year were forced out. The tactics employed in constructive dismissal range from intimidation, public humiliation, to spreading rumours and denying employees the opportunity to defend themselves.

 

Several landmark cases have slowly raised these issues in India.  

 

Former Microsoft India senior executive Lathika Pai's ongoing civil suit alleges constructive dismissal through a hostile work environment, seeking damages for loss of pay, mental distress and reputational harm. She alleges that there was a breakdown in workplace safety where she had complained about cyberbullying, biases that doing business with the Indian government must involve bribes, non-adherence to global policies for Indian employees, retaliation for raising concerns, thereby resulting in her resignation for cause.  

 

In January 2025, in Deepak Ranjan Rout vs Microsoft India, the civil court in Bangalore ordered Microsoft India to pay damages of about Rs. 56 lakhs for loss of bonus, increments, and gratuity ex-parte (Microsoft India did not show up for any of the hearings). 

 

In July, the Delhi HC ordered Wipro to pay Rs. 2 lakhs in a defamation case and ruled that stigmatising language in termination letters constitutes character assassination. The National Human Rights Commission launched a fresh investigation into Foxconn India’s Tamil Nadu facility over allegations of discriminatory hiring practices.

 

The Bombay HC Judgment recognised in the Asahi India Glass Ltd. case that disproportionate punishment, especially when unaccompanied by prior warnings, can reflect a hostile or retaliatory work environment. The tragic death of the EY executive attributed to overwork has intensified calls for comprehensive labour reforms, especially in the private sector and MNCs.

 

Despite the challenging environment right now, India’s legal system offers a few avenues for employee protection.

 

Like one of the strong laws of our country, The Sexual Harassment of Women at Workplace Act mandates that organisations with more than 10 employees should establish Internal Complaints Committees (ICC) with strict penalties, which currently takes care only of sexual harassment cases, should be extended to handle mental harassment at workplaces too. Constitutional protections under Article 21 (Right to life with dignity) and Article 14 (Right to equality) provide additional safeguards. The Industrial Employment (Standing Orders) Act requires employers to establish clear conduct guidelines that can also address mental harassment, while the Bharatiya Nyay Sanchita(BNS)’s sections 503 and 504 specifically talk about threats and intimidation.

Taking Action: A Step-by-Step Approach for Employees

Documentation is very crucial. Employees should maintain detailed logs, including dates, times, and locations, while preserving all relevant digital communications and records. Preserving digital evidence is extremely important. One can keep screenshots of offensive emails, text messages or social media communications before they are deleted.

 

This is important as companies can restrict access to them during investigations. One should also keep copies of all the performance reviews, project assignments and work reports as these help in showcasing one’s professional competence. These also come in useful if the employers justify termination based on performance issues. One can also record any professional opportunities lost or career advancement blocked due to the work environment.

 

Internal reporting is the first step to take while facing a hostile work environment. One can complain to the immediate manager unless the complaint is against them. One should also file a formal complaint with HR, referencing specific company policies that have been violated.

 

One can also file a formal complaint to the Internal Complaints Committee (ICC) in an organisation with more than 10 employees if it is sexual harassment. Employees should be aware of and utilise the established grievance mechanisms, file complaints where applicable and ensure proper follow-up on investigations. Internal reporting should be prioritised, as when it fail, external remedies are always available.

 

One should monitor the investigation progress and keep a check on regular updates. If the process or conduct looks bias, one should raise the concerns immediately. Companies and employees also have to maintain and ensure confidentiality.

Legal Action: The Final Recourse (External Remedies)

• Criminal complaints for serious offences: If the harassment involves criminal acts such as physical assault, stalking, threats or criminal intimidation, one can file a FIR ( First Information Report) with police under BNS Sections 503 and 504. In such cases, the further investigation is carried out by the police.
• Civil Suits for compensation: An employee can pursue civil litigation seeking damages for reputational harm, mental trauma or career setbacks.
• Labour Court proceedings for employment disputes: If the case involves forced termination, unfair labour practices or denial of certain benefits and rights, employees can approach the labour courts.

Constitutional remedies through the high courts- If the cases violate fundamental rights, one can approach the High Courts directly through writ petitions.

As India’s economy continues to evolve, the tension between corporations and employee rights has reached a critical juncture. While a few legal protections exist, enforcement remains inconsistent, and employees lack awareness of their rights. Employment contracts are written in a manner that gives both parties to terminate the contract “at will”.

 

Many a time, HR Managers coerce employees to resign, else they will face termination. Thus, multinational companies in India continue to get away with an “imbalance of power” as global corporations fail to apply their own stated ethics and HR Policies, especially outside of their home jurisdiction. They are aware that the legal system in India is extremely slow, requires deep pockets to get a good legal team, which they can afford, and an employee cannot. MNCs are also aware that the reputational repercussions for employees of suing an employer almost always result in employees choosing not to pursue legal actions.

 

The surge in constructive dismissal cases and workplace harassment complaints signals a broader shift in how employment relationships are being managed.

The message is clear: The economic pressures may justify workforce reductions, but companies, especially global MNCs, cannot excuse the violation of basic employee rights or the creation of hostile work environments to force resignations.

 

The Indian legal system must look into providing stricter guardrails for employee protection, with strict penalties to those companies that are getting away with these violations in India, which they would not have in their HQ countries like the US, UK, Europe, Australia, etc, where the employment laws are stricter. All eyes will be on the high-profile case of Lathika Pai vs Microsoft et al.

(The author is the CEO & Co-founder, Kelp)

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