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Rajesh (engineer)     01 June 2014

Company is not paying the pending salary and allowances

hello everyone, this is Rajesh
Following is my story about NON Professional From My current Company and Salary Issues.
I was working in Pune Based company, I got offer letter in March 2013 from one Chinese company employee(who is Indian)
 who was responsible for operations in India  (office located in Gurgaon, Haryana).
 But later on,  after joining the company on may 1st 2013,I found that the company is not registered in India.
 when i asked about it, the answer was the- we filled request in Indian Embassy(I am unaware of 
registration Procedure and I believed.)
Within first month when time came to arrive my first salary, I got answer that company 
will not pay first month salary taking this as security and they didn't paid me,
actually I made mistake here by not forcing because I was aware about company reputation in China,
but here in India the situation was One man Oriented Organisation. Not even Registered In Indian Market.
I spoke with Chinese General Manager, he told me that don't worry we will pay use timely with due legally
and as with same time we will get registered in India but it was only orally just like to fool me.
From The same month I Joined this new company I faced salary issues.
 as second month arrived my salary was delayed for 13-14 days and the same problem continues till
March 2014.(Yes I waited for one year looking forward to my career.)
I specially want to mention that I am An Engineer, so we get Site allowances apart from Salary.
these allowance I didn't got till date providing the reason that company is not registered yet,
 we don't have account in India. as far as for whole one year I got the same reason.
Every time I have to beg for my salary and allowance money, but no proper treatment yet.
I have Offer later which noted for one year April 2013 to March 2014, 
and all of sudden they offered me joing letter mentioning 3 years of contract in June 2013.
that time I refused to sign and neglected the part.
( i still have that original joining letter Copy fot 3 year without signature).
After suffering lots of unpaid money issues, I decided to quit in the month of May 2014,
( Till date the company is not registered in India) and I Resigned from Company.
 I asked my first month salary(25000 INR)+ Current Month May 2014 working days salary and
rest of my allowances.
And here they clearly refused to pay me single penny.
and forcing me to sing again for 3 years contract if i want my pending money.
In India so called company office only One person who controls all and it's One man Orientated Organisation.
I am helpless because I don't know what to do and what action to be take.
( I only have Offer letter and unsigned original Joining Letter for 3 years).


 4 Replies

Kumar Doab (FIN)     01 June 2014


Each company has to register before starting its operation as per prevailing state and central laws! 


What is this establishment: Commercial, Industrial, Small Enterprise?

The registration certificate might have been displayed near entrance or you have to find on your own.  

You were located in which state? Does company have an office at your location?

Redg. office of the company is located in which state?


What is trade of this company: IT, Banking etc…..?

How many people are employed in it?


Does the company have its certified standing orders(CSO) and has it been extended to your designation?


What was your designation and nature of duties…?


Did the company provide salary slip, PF, ESIC,Group Insurance, Form16 etc?

1 Like

Rama chary Rachakonda (Secunderabad/Highcourt practice watsapp no.9989324294 )     01 June 2014

Submit your grievance and give a complaint to registrar of companies. 

1 Like

Rajesh (engineer)     02 June 2014

Dear sirs,
thank you for the reply,
this company is established in china in year 2000 and stated selling machinaries in India 4-5 years ago.
As Commercial office started in India From April 2013 for sales and customer service purpose which 
is Located at Gurgaon,Haryana(Delhi NCR).
As per my knowledge Redg. office of the company is located only in shanghai,china (but information i got
they will try to register with another name showing its singapore base firm.)
company is related to provide Large machinery and turnkey projects for dairy & beverages industry.
company have manufacturing unit located in China.
#Does the company have its certified standing orders(CSO) and has it been extended to your designation?
( i have no idea about this)
there was total 4 employees including manager, one of us already left,
now there are 3 Indian respectively Manager, Sales Exicutive and Service Engineer(Me),
sometimes chinese use to come for customer visits.
My designation is as Service Engineer and i have to service and install new/old machinery.
Company has never provided salary slips, PF and othes, we requested timely but got neglected.

Kumar Doab (FIN)     02 June 2014

The company’ office located in Gurgaon is not engaged in Manufacturing activities therefore might have registered under Punjab Shops and Commercial Establishments Act (state of Haryana follows it) and it can be accessed at Dept. of Labor website of Haryana, along with contact details of Labor Officials……………..They can also comment on ‘Why the local office was left or allowed not to register OR has it been granted any exemption as per prevailing rules?

If NO exemption was granted and company did not register its office it can be panelized and it shall have to register by paying penalties.

AS advised by Mr. Ramachary you may lodge a complaint with Registrar of Companies as well.

The Labor Officials have to take suo motu notice of such violations…………………………………….and have to act on even complaints by phone, anonymous complaints, by  email, in person, by letter……………………and matter can also be perused thru RTI.

Salary slip has to be issued to all employees as per various enactments and should be supplied at least a day before the disbursement of wages, and as per rules towards various forms/formats/registers prescribed in enactments applicable to establishment…………………e.g.

Payment of Wages Act ;Sec13A

Minimum Wage (Central) Rules, 1950, Rule 26(3) (4)

Punjab Shops and Commercial Establishments Rules: Sec5                                         

If the earned wages are not paid in time on usual pay day the employer can be fined say Rs.7500/instance!

IN the meantime you may go thru  Punjab Shops and Commercial Establishments Act and Punjab Shops and Commercial Establishments Rules………………….

Punjab Shops and Commercial Establishments Act:Sec;2(iv,vi,vii,xiv,xvi,xxii,xxiii,xxiv,xxvii,xxviii) ,3,4,5,13,15,16,17,18,20,21,23,26,32,


Punjab Shops and Commercial Establishments Rules; 3,4,


The employer of every establishment about the business of which

persons are employed shall maintain the following registers, namely:-

(1) a register of employees in Form C ;

(2) a register of wages of employees in Form D; and

(3) a register of deductions in Form E

7,9,10,13,15,22,……………………………………….and various forms published in Rules………………




Did the company issue any offer letter, appointment letter?

Did it mention the T&C of security deposit in writing in any of the documents issued by it say………………..job advt, interview call letter, selection letter, offer letter, appointment letter, HR policy/service rules and regulations mention of which is usually made in appointment letter etc…… ? NO deduction from earned wages can be made except deductions permitted by statues, that is duly explained in enactments like Shops and Commercial Establishments Act, Payment of Wages Act etc…………………….and any for any other deduction there has to be a valid contract between employer –employee.

You have posted that the offer letter issued to you was for 1Y………………………….it is felt that the appointment might be a FTC (Fixed Term Contract)! Who has signed it; Indian Executive in Indian Office or Foreign Executive in Foreign Office? Which address is typed on offer letter: Indian/Foreign? Does it contain payment of site allowances?

The original joining letter issued to you is signed by company’s executive or not? (It is noted that you have not signed it).

The employee can decline to accept any change in service conditions, any agreement, any contract drafted by employer.

If you have not signed the service agreement/contract, towards your acceptance it is not applicable to you. If you sign and resign before 3Y, company may claim the liquidated damages stated in it to be paid by you!

The 3Y agreement to serve was inserted in lieu of what extra ordinary favor by company say: Training that would add some extra ordinary skills, certified by some Instt.?

All amounts mentioned in the offer are committement and have to be paid by the employer.

Have they refused in writing?

Have you lodged your demands in writing under proper acknowledgment, narrating all previous representations………………………mentioning dates, names, brief minutes of discussion?

Have you tendered resignation with immediate effect or notice of resignation with notice period stated in it? Have you handed over the charge, company property under proper acknowledgment/

Do you have copy and proper acknowledgment or POD of your resignation?

Has the company issued acceptance or declinature of resignation in writing, FnF statement for verification and acceptance?

Has the company issued Form16?

Has it provided any group insurance?


The PF,ESIC may not be applicable……………….but employer can provide even if not applicable as per Act.     

Standing Orders may not be applicable.


If employer defaults on payment of wages it may default on PF,ESIC,TDS etc………..

Employee can approach:

----Employees Unions : There are employees unions that have done good job.

--- Trade Unions e.g; CITU, AITUC, INTUC ............................

 The trade unions are willing to embrace employees and they are very effective too.

--- Inspector under Punjab  Shops and Commercial Establishments Act, If it is commercial establishment.

The employer has to maintain and submit requisite forms and registers according to Shops and Commercial Establishments Act. If the employer makes false entries it is offence.

--- Inspector under Payment of Wages Act: applicable to all employees drawing wages up to Rs.18000/pm as per def. of wages in the Act. 
You may refer to: Payment of Wages Act; Sec13A and 2: 3*[(i), (ia), 3*[(vi), 3, 4 ,5, 13a, 14, 15, 16, 17A, 20………….. and if the Inspector agrees to cover you may immediately submit Form’N’ for recovery of wages.

--- O/o Labor Commissioner:


----RPFC thru nearest PF office

----ESTC Inspector in jurisdictional ESTC office

--- ITO; TDS where you file your ITR

--- CIT-TDS (jurisdictional) where company files ITR

----Lawyer/Law firm

---Civil Court

Employees have been contemplating to file criminal complaints u/s 406, 420……………………………and to approach employer as creditors treating unpaid wages as debt on employer e.g;



The employees have even filed Winding Up petitions and have succeeded.

Before you act further It shall be appropriate to show the job advt, job application, interview call letter, offer letter, selection letter, appointment letter, CTC sheet, Salary Structure, Salary credit details, Service rules and regulations, Conduct and discipline rules, Notice of resignation, resignation etc…………….. Communications exchanged to a competent and experienced Labor consultant/service lawyer at your location, give inputs in person and proceed under the expert advice of your lawyer.


Your lawyer may ask you a set of structured questions and may opine that you shall be covered as ‘Workman’ as in ID Act, ’Employee’ as in Punjab Shops and Commercial Establishments Act…………..   and can explain all options available to you and help you lodge complaints successfully.



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