If we understand the real meaning of the term " suspension " with its import in employment parlance, we will be sure that it is the consequence of the interim decision of an employer to temporarily debar an employee from attending t his office and performing his functions in the establishment EITHER on the ground of contemplation of an enquiry into grave charges against him or its pendency at any stage OR a complaint against him of any criminal offence is under investigation or trial or its pending disposal. However, the contract of employment between the employer and the suspended employee is still in subsistence, of course, in a state of suspended animation.As no work is done by the employee during his suspension, the question of wages or salary for that period does not arise. But, suspension being a discretionary act of the employer stemming up from his powers of discipline and control, based on equity and justice, he has to pay some money to the employee to enable him to subsist and face the disciplinary proceeding initiated against him. It is called as "Subsistence Allowance " as mandated by Sec.10-A of the Industrial Establishments(Standing Orders) Act,1946 or any other special Law in this regard or the Service Regulations of the establishment depending upon the post held by the suspended employee as the case be and paid to him at the rates specified therein during the entire period of suspension.
If you have suspended an employee pending enquiry, the suspension allowance is payable at the rate of 50% of the salary for first three months and 75% salary for next period. This is the case if the Standing Orders Act is applicable to your company, ie if you are engaging more than 50 workers.
If your query is pertaining to suspension by way of punishment, then salary is not payable because that is the punishment itself that he is suspended without pay for the period that you have punished him.
While giving concurrence to you on salary not payable in case suspension by way of punishment I would like to add further that if any employee is suspended by way of penalty without an inquiry or without a proper inquiry, such suspension is untenable in law and the employee will become entitled to full wages for the period of suspension that would have been payable had he not been suspended.
If you have a Standing Order or Service Rules in regard to disciplinary proceedings, you have to pay the subsistence allowance at the rate specified therein.
In the absence of the above, you are liable to pay full salary being drawn by the employee.
P S Lakshmanan