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gargi (associate consultant)     24 August 2012

Delay in payment of notice period salary

Hi,

I am serving notice period and My company  (3i-infotech -a listed company) has stopped paying me salary for both the months. They will pay it in full and final settlement. But The company takes a period of 4-5 months after the last date in office  to pay such due amount and also does not pay any interest for this period. The company is going through a financial distress and is under CDR and it cites the same reason for such undue delay.

Is there any law, which can help all the employees like me for a quick recovery of our money as i see it comletely unjustified.

I will be grateful for your advise

Regards

Gargi



Learning

 2 Replies

V. VASUDEVAN (LEGAL COUNSEL)     24 August 2012

This has become a common practice in industry, which is deplorable. The term full and final settlement does not at all cover the salary accrued month on month and if at all the last month's salary can be clubeed for full and final - to adjust against any recoveries. As per the Shops   & Commercial Establishments the employers are obligated to settle the salary of a resigning employee within 7 days of the last working day.

Take this up with the Company or write to the concerned local Labour Inspector under the Shops and Establishment Act.

Vasudevan

1 Like

Kumar Doab (FIN)     25 August 2012

Mr. Vasudevan has given valuable advice. Kindly follow it.

Have you submitted any written communication under acknowledgment with a copy to you for non receipt of salary of first month by the usual pay day and issued reminders.

Let them reply in writing that it shall be paid in FNF settlement. You are probably in 2nd month of notice period. You may submit a tentative list of payables by company to you, and payables by you to company if any and conclude the amount of receivables from company and request the good offices of appointing authority, MD, Company Secretary to disburse say 80% of it to you to meet your financial needs. You may remark that you are facing acute financial hardship and are not able to support daily needs of your family due to non disbursement of your wages.

ITITES companies were granted exemption from provisions of Industrial Employment Standing Orders Act and some provisions of SE Act in some state and then extensions were granted.

IT and ITES Policy, 2003

 

                 GOVERNMENT OF MAHARASHTRA

9.3     Reports/Returns      in  electronic   formats   will  be   accepted   as  per

               provisions   of   IT   Act   2000.  To   enable   IT   and   ITES   units   to

               submit     reports   and   returns   in  electronic    formats,    necessary

               amendments in the following Labour laws shall be made.

 

            Employees State Insurance Act

            Factories Act

            Payment of Wages Act

            Minimum Wages Act

            Contract Labour Act

            Shops and Establishments Act

            Workmen's Compensation Act

 

       9.4.    IT    and   ITES     units  shall   be  allowed      to  file  self-certified

               reports/returns to concerned Officers of Labour Department

 

 

 

 

State of Karnataka is contemplating to end the exemption.

The companies record salary as expense in its books. Has this company adjusted the salary for 1st month in its books?

The Inspector under SE Act /ALC can examine the records and also call for records?

4-5 months for payment of wages is not at all agreeable. You may also lodge a complaint with Wages Inspector if your wages are up to Rs.16000/pm.

If the company has filed for closure/liquidation you should act fast.

 


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