I am facing this issue from last two months when i have joined my company . I am contract employee and in the offer letter, it has mentioned that you will be paid monthly.
Below is the line
You will be paid a consolidated Consulting Fee of Rs. XX,000/- (Rupees XX
Thousand) per month, subject to TDS as per the tax laws.
so is it breach of contract by an employee if not paid monthly on time.. first payment i have received after 50 days and second payment in 40 days .. i have not been paid monthly in 30 days pay cycle but instead 40 or 45 days cycle ..is it breach of contract... i am on 6 months fixed contract.Please guide me how to proceed.. i dont want to continue with the company as not being paid on time... how to resign.. please guide i have 30 days np.

From India,

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Dear Vitsb,
The contract employees,whose salary do not exceed Rs.18000/- are covered under the Payment of Wages Act,1936. As per Section 5 of the Act, an employer is supposed to pay the montly salary before 7th day of wage month where less than 1000 persons are working and before the expiry of 10th day of where more than 1000 persons are working. Your contention is correct, it it certainly a breach of contract by an employer, if salary is not paid in time but to enforce it, you need to take legal recourse if your salary is exceeding Rs.18000/-per month or file a complaint with the concerned labour authority of the state if the salary doesn't exceed Rs.18000/-. As mentioned by you,you can put up your resignation by giving a month's notice or pay the one month salary to the employer if you are interested to be relieved immediaetely provided your emploer agrees.
BS Kalsi

From India, Mumbai
"You will be paid a consolidated Consulting Fee of Rs. XX,000/- (Rupees XX
Thousand) per month, subject to TDS as per the tax laws. "
In my opinion, the above line stipulates consulting fee and not monthly salary. It is further pointed out that this depicts simply per month rate and no specific mention when to be paid. Therefore, how can we say breach of contract and how we can prove the same.
In fact, I wish to know whether Consulting Fee can be termed as Salary/Wages. And term 'per month' can bind payer to make payment on the expiry of month.
V K Gupta

From India, Panipat
Mr. Gupta's contention is correct.

It is a contract with fees, not a salary. The fees is a monthly amount and for a fixed term.

So it is not covered under payment of wages act irrespective of salary limit.

I don't think the letter states he will be paid on the 30th day of each month. It is normal for bills to be paid after they are processed and therefore 50 days (meaning 20 days after the end of the month, assuming that he has submitted his bill on time) is a normal payment cycle. The second time he was paid within 10 days of the end of the month.

The legal stand is as above.

In practical terms, if it actually a salaried job shown as contract for tax purposes or to avoid long term employment commitments, then it's unfair of the emoloyer to pay late and the employee is free to resign and search for alternate jobs. But ofcourse, he can not resign, he need to send a notice of termination of contract for delay in payment of fees. But I suspect the employer can hold back his pay,net in such a case. It's a point we can't predict as we don't know the circumstances of the employment / contract.

From India, Mumbai
Now I want to know from the original Vitsb 1, what amount of TDS is being deducted from his monthly payment, if any. This I just want to know for further clarification on the topic. V K Gupta
From India, Panipat

Consideration whether in the form of consulting fee,salary is the basis of contract.In trun employee renders service as consultant/employee.
Delay in salary/fees is a breach of agreement/contract and remedies can be in form of giving notice to cease contractual obligations.
I am sure the contract/terms of engagement would contain terms pertaining to termination of contract.

From India, Pune
Dear sir,
This condition I am facing is with the MNC company. There is no problem for permenant employees. But as I m contract employee having salary less than 15k and tds deducted is 10 percent of the salary every month. In this case I have drafted email to vp and RMG, Assistant manager head as I am into recruitment. They said we are working on payment cycle..I have submitted invoices and timesheets every last date of month ..but I can not withstand here. As grivence disclosed 2 months back ...I m here from last 3 months. .please guide..how to resign or to relieve from company..my reporting managaer is saying which is also assistant manager that you can resign and wait for 30 days np..but I am in doubt if account will release cheque in 30 days or not ..he take 50 days and said me for a contract employee. We keep 20 days pay in advance.

From India,
From what you have reported in this post, you are not an employee contract. Therefore you do not have any protection under the Labour laws.
Your payment terms and payment cycle should have been finalised when you started doing the work. Otherwise, the normal payment cycle of 50 days is quite prevalent. There is no law saying that they have two pay you the day you submit your invoice
Since you are not an employee, are you cannot resign. Instead you need to give a notice of termination of your contract on account of delay in payment. A reasonable notice of termination of 30 days as asked for by your manager
Your payment for the last bill race by you at the end of the termination period will I am sure be paid by them in the normal cycle of 50 days.

From India, Mumbai
Hello Vitsb1,

Without getting into what the other members suggested, I suggest you look @ the situation from a different perspective.

You are on Contract for 6 months, out of which 2 months [or is it 3?] have already elapsed. The balance would be 4 or 3 months. And even IF you resign now, your Notice Period would be 30 days.....meaning whether you like it or not, you will have to serve for another month at least from the date of resigning.

And you also need to keep in mind the scenario Saswata Banerjee mentioned "I suspect the employer can hold back his pay,net in such a case" is QUITE POSSIBLE.

Another point--you have focused ONLY on the delayed salary. How about the work culture OR the work itself....do you think you are adding positively to your resume? You say this is a MNC--so I see at least the Brand name being added in a positive way to your resume.

And Nathrao is right about our legal system--"remedy is worse than the disease".

My suggestion is for you to continue till your completion of contract & move over with the Experience Docs....since it's a Contract, the Company may not hold any of your last month's Fees/Salary.

In a way, you are better off than permanent employees who don't get their salaries on time. In your case, you at least KNOW when you need to move-on. While this MAY NOT be the Best-case-Scenario one desires, it surely is NOT the Worst-case-Scenario too.

All the Best.



From India, Hyderabad

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