Arun (Professional) 05 December 2012
Sudhir Kumar, Advocate (Advocate) 05 December 2012
an employee is not entitled for PF deposit for the peirod for which he has not been able to obtain salary. They have still paid. They prima-facie appear to be gentlemen.
Kumar Doab (FIN) 05 December 2012
Apparently company is trying to avoid payment of salary/wages for as much time as possible as ill informed/hapless employees are easy to maneuver and manipulate.
It is difficult to understand why the employees should continue to labor for many months if employer is not paying the salary/wages. The employees should submit repeated representations to good offices of appointing authority, MD, Company Secretary with a copy to Head-HR for payment of salary {by bank DD only in a case like yours}, and FNF statement, FNF amount by bank DD, Form 16, work experience certificate/service certificate, NOC/NDC, relieving letter, attested copies of PF withdrawal/transfer form {submit the forms} for submission to PF office by employee etc by redg post so as to reach within next 7 days. The employee should conclude in gentle words that as wages/salary are not being paid for months altogether employer has become unworthy of being employed with and hence no notice period/pay should be applied and it should be waived off as employee is left with no other alternative but to seek source of livelihood somewhere else.
The FNF amount should normally be paid by the next normal pay day.
As per provisions of IESO Act the wages should be paid on last day in office or within next 2 days. The state of Karnataka has ended the blanket exemption granted to IT sector hence all companies are expected to frame their certified standing orders or provisions of model standing orders shall apply.
Reliving letter has been issued to you. Reliving letter is issued post all settlements and it confirms that you do not owe anything to company and has handed over the charge/company property etc.
The employer has paid the PF contribution to escape penalty.
What are the offences under the Act what is the punishment for them?:
a. “If any employer makes default in payment of the employer's contribution or the employee's contribution payable under the Employees' Provident Funds Scheme or paragraph 38 of the said scheme relating to the payment of administrative charges, or under section 17(3)(a) of the Act relating to the payment of inspection charges, he would be punished with imprisonment upto three years but it shall not be less than one year and a fine of Rs. 10000.00 in case of default in payment of the employee's contribution which has been deducted by the employer from the employees' wages and six months and a fine of a Rs. 5000.00 in any other case.”
Is the employer liable to pay the contribution when he is not in a position to pay wages to the employees?: The employer is liable to pay the employer's contribution as well as the employee's contribution irrespective of the fact that wages have been paid to the employees or not.
Likewise the employer must have deducted TDS on FNF amount and must have deposited it with jurisdictional authorities. The employer must have been paying all other mandatory fees/amounts as prescribed under law but is not paying the salary.
In a given situation employee can approach trade union, labor authorities, wages inspector, labor inspector, and/or invoke the provisions of ID Act, IESO Act, Payment of Wages Act, and SE Act applicable to the state, as per explanation of employee under the provisions of these enactments or approach civil court. Designation alone does not decide that employee is a workman or not.
It shall be appropriate to approach a competent and experienced service lawyer/labor consultant with copies of all of your documents and give inputs in person and proceed under expert advice of your lawyer. Do not conceal anything from your lawyer. Your lawyer shall evaluate the merits and may opine that you fall within the category of workman. Your lawyer shall arrange for citations and judgments to support your cause.
Company may yield to legal notice of your lawyer or you may have to agitate in the appropriate forum. Company may yield to your demands during conciliation proceedings in o/o ALC or the ALC shall issue reference to Labor Court.
Valuable advice of learned experts/members is sought.