Hello Experts, An small IT company in Chennai has closed its office and doing its business with all employees working at home. I have two questions.
Is it legal for a registered company working without a physical office premise? If not legal, What legal action can be taken against the company for running the company without having a registered office? How can an employee take legal action against the company on a full and final settlement issue when the physical office is closed?

From India, undefined
Dear Parimala,

Your query is more on the closeness of the office rather than the actual problem that you are someone else is facing. The replies to your questions are as below:

Q. Is it legal for a registered company working without a physical office premise?

A. Because of the pandemic, a large number of companies are running their operations by telling the employees to work from home (WFH). However, to register a company, there has to be an official address. You may check the company's website.

By the way, what about the appointment letter issued to the employee? The company's address must have been mentioned in the appointment letter.

Q. What legal action can be taken against the company for running the company without having the registered office?

A. I don't think this contingency will come at all. You may check Google and you will get the address of the registered office. As stated above, you may check the company's website or the appointment letter.

Q. How an employee take legal action against the company on a full and final settlement issue when the physical office is closed?

A. Method of operation of the company and Full and Final Settlement (FFS) are the two separate things. Why these are linked together is not understood. The business owner or the employees may work from home but that is not a ground to hold exited employee's FFS. Wherever the owner is working, you may obtain the address of the company from Google or from the appointment letter itself and send the official letter in the form of hard copy for the clearance of FFS. Send the letter by Speed Post with acknowledgement due. Scan the copy of the letter including the receipt from the post office and send it by mail too. Preserve the printout of the email. If you do not receive any reply or the FFS then you may file a complaint in the Labour Office under whose jurisdiction your company falls into. Once you file a complaint then we will guide you on what to do further.

Final comments: - Suppose the business owner has done a business without registering his/her company or has not registered under the Shops and Establishment Act, even then also an employee needs to have tangible proof of employment. A complaint can be filed in the labour office for undertaking a business venture without following a due process of law. Nevertheless, whether someone follows the law or not, I recommend you restrict your attention to the recovery of the dues.

Thanks,

Dinesh Divekar

From India, Bangalore
Thank you for the clarifications Mr.Dinesh.
Actually one of the employee was forced to resign and employee is facing problem in getting the final settlement. The management has closed the office. We have raised the dispute with labor office. The labor office sent the notice. As the office is closed, the notice is not getting served to the management and they are not appearing for the hearing. Labor officer is also not seriously trying to bring in the management to the table other than sending notice. This is the issue we are facing.
We have the registered office address, but the company is not operating there now. So, we have to take action against the first for not operating in the registered office location to get our dues
Please advise.
Parimala.

From India, undefined
Dear Parimala,
In case if you have approached the labour office and if they have issued the notice then you may try to impress upon the labour authorities to send the scanned copy of the notice through the official email ID. If the lower-level authorities at the labour office are not cooperating then you may put up an application to the Asst Commissioner of Labour (or any other authority parallel to this position) to intervene and send the notice through email.
By the way, when the labour office issued the notice then has the copy of the notice been sent to the aggrieved labour also? If yes then he too may send the scanned copy of the notice to the company authorities. If you have the personal email ID even then also it can be sent. If the company authorities pretend that the notice sent to the personal email ID is not valid then you may take a stand that the validity of the email ID will be decided by the labour authorities or the court of law and he/she need not apply his/her mind at this stage.
Thanks,
Dinesh Divekar

From India, Bangalore
thank you for your valuable suggestions Mr.Dinesh. Parimala
From India, undefined
Dear Ms.Parimala,
Please try to understand that every Govt Official charged with certain statutory duties has his official limitations.
The labor officer who is a conciliation officer under the IDA,1947 can at the most initiate conciliation u/s 12 of the Act, only if the complaint is an industrial dispute. Non-payment of dues to an employee under F&F Settlement, per se, is not an industrial dispute under the IDA,1947 requiring conciliation. Either the employee can file a claim before the Labor Court u/s 33-C(2) or u/s 15 of the Payment of Wages Act,1936 before the D.C.L who is the authority under the Act.
Therefore, you cannot blame the L.O for the non-service of notices sent by him to the Company due its registered office remaining closed.
Better, you may write a complaint to the State Registrar of Companies in this regard if it's a registered company under the CA,2013 or issue a paper publication about the next date of hearing fixed.

From India, Salem
Dear colleague,

Just to add to what other learned colleagues have expressed.

The issue is about unpaid F&F settlement and notices served by the Labour office to the registered office of the company are getting returned unserved as the owners are not operating from the office.

If the company has registered office, it is obvious that it is registered under Companies Act and/or with shops and establishments authority as proprietary/ partnership company. The names of the proprietor/ partners, who have ultimate authority in this matter, and their addresses must be available on their records . Try to obtain this vital information and arrange to get the notices served individually on their available residential addresses.

Just because the registered office is non- functional, does not mean the owners can escape their legal obligation.

This issue is about non - payment of dues and follow the appropriate advice of Mr Umakanhan regarding filing case under sec 33- C (2) of the

ID Act.

Regards,

Vinayak Nagarkar

HR and Employee Relations Consultant

From India, Mumbai
Thank you for the suggestions Mr. Umakanthan and Mr. Vinayak.
Actually we filled for claim with ACL.
But The problem is to bring in the company authorities to the negotiation table.
We have sent the notice copy in email and WhatsApp to the owner and plan to provide this as evidence to the ACL when we go to next hearing.
Parimala

From India, undefined

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