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I work for a software company with 20 employee like a startup. Without any notice the company said they are shutting down.
My salary till the last month has been paid without any due.
As per contract I should be given 2 months notice, also first year bonus is pending.
Am I entitled for severance pay for 2months and the bonus ?
Reason for shutdown : Investors doesn't want to spend more money and business is not making profit.
Company doesn't have any asset other than computers and laptops.
What are the steps if any to claim severance pay ? Do i need to go to court and all that ?
Please revert as soon as possible.

From India, Pune
Labour Law & Hr Consultant
Deputy Commissioner Of Labour..a.p.
Compliance Manager


Lodge a complaint in labour Office of that area under payment of wages & payment of bonus as has not been made. Take all who are also affected by closing down of establishment.
From India, Mumbai

Though the company want to get rid of all the employees, it is not easy to close down the operations just like that as the filing of accounts and notice of closure to the MCA are to be done, if not done already. You may lodge a formal complaint with the labour office locally and also make a request to the company to pay all the dues as per the employment terms. Check if all other employees are ready to make a representation to the Labour Department. The sooner you do this the better your chances of getting the dues, as much as possible. Try to get the relieving letter so that it can be used for your future employment. Diplomacy first followed by other options. Look for better opportunities while taking up the issue, simultaneously.
From India, Hyderabad

Yea..Sir. provision is there.But since how long the start up company running. No bonus payment required for 5 yrs before started industries...
If you are well off...If the company u felt in loss .. Truely...Leave all such cases
The prime motto of launching startup policy is to encourage industrial growth by avoiding suffocation from all sides of existing Laws ..Liberalisation of conditions of Working...
Take decision of your own... When a person lost employment he relocate somewhere.. But a company truely gets loss Sufferings from all sides to the entrepreneur s..I am not discouraging you pls.

From India, Nellore
Company has not filed insolvency or anything like that to the government. They just verbally told us that they are closing the company for financial reasons.
Few of us have a company laptop given to us for work.
Can we keep the laptop as collateral for the payment in lieu of notice (if they dont pay severance pay) ?
Company is asking the laptops back to get the experience letter.

From India, Pune
Also investors are from abroad. They decided to stop the investment.
From India, Pune

Dear Samjohn,
I am constrained to state that in a critical situation of serious doubts relating to probable loss of employment due to imminent closure of the establishment and closure compensation, the questioner should be really serious in drafting his questions. What do you mean by " a software company with 20 employee like a start-up? ". In the first place " Start-up Company " is a very vague term for it denotes a newly formed business with particular momentum behind it based on perceived demand for its product or service. There can not be any fixed parameter to define how long a start-up company would remain as such based on its poise towards profitability. For example FACE BOOK was without any profit during the first five years from its inception. Therefore, it is important to mention the age of the company as well as the range of the period of service completed by the employees there so far. The founders of the company may have their own hidden exit strategy to sell it later to a larger company with a sweeping market share and to ease the process, adopt the strategy of sending out the existing employees based on non-profitability and paucity of further investments. In such a situation of closure of the undertaking, the company has to pay you compensation as per Sec.25-FFF(1) of the Industrial Disputes Act,1947 as if you were retrenched. Better let all the 20 employees jointly make a complaint to the local ALC or DLC immediately.

From India, Salem
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