HR Dilemma: How Should My Friend Handle Threats Over Withheld Salaries?

Seeking Advice on Salary Hold Situation

One of my friends works as an HR Executive. Recently, she was told to put on hold the salary of 30 employees because their operations manager believed that these 30 employees would quit once they received their salary. Now, the parents and well-wishers of these employees are calling my friend, threatening her, and warning her of facing dire consequences. However, she has nothing to do with this situation as she is simply following instructions. She is quite scared and upset about the circumstances. Therefore, I kindly request all the seniors to come forward and provide their valuable suggestions so that we can help her out of this awkward situation.

Regards,
Dev

She can talk to the manager and pass all this information. Moreover, she should be comfortable talking to all those employees and tell them that there is nothing for her to do in this mess.

Please ask your friend:

a) about the existence of company policies, including those regarding the notice period.

b) the reason for the mass departure of employees at one time. It is unlikely that 30 employees would plan to abscond simultaneously without any fault on the management's part.

Regards,

Yes. Please ask their parents to meet the operational manager. As HR, she followed the operational manager's instructions. At the same time, ask your friend to meet the operational manager and explain the information to him.

Regards,
Krishna

Dear Dev, She has to:
- Take the issue to higher authorities.
- Discuss with the employees.
- Stop taking calls from parents or friends, as the agreement is solely between the employer and employee, and the issues should be resolved between both parties.

Kindly ask her to maintain email correspondence with higher authorities as proof of the conversation and convey the same to affected employees.

Regards,
Jyothi

Handling Employee Salary Hold Issues

My suggestion is to address the issue by inviting the parents to the office. Treat them with tea, coffee, and biscuits (Britannia would be a good choice). Ask the employees to attend as well. Explain the reason for holding the salary and have them sign a contract where the employees give assurance that they are not looking for a change. Management must be present during this meeting.

She should also go to the local police station and lodge an FIR against all those employees and their parents. Inform all the employees and management about the issue through emails, including the complaint lodged against the employee and their parents. If the matter is not resolved, she should continue to answer phone calls. However, once the parents are aware of the FIR, they will likely stop calling. People who threaten over the phone usually can't do anything in reality. She should consider diverting the call to the local police officer, who will handle it. Moreover, in India, there are many legal benefits available for females. She can even approach the Ladies Special Wing in the Police Station. A quick Google search can help find the number of a female NGO to contact. Just apply this approach; it will definitely work.

I strongly agree with the points mentioned here by Jyothi. She should approach senior management to sort out this issue, as holding the salary of this many employees will not leave a good message to the other working employees. Moreover, if many are planning to resign or go absent, this signals an internal employee conflict with management and indicates poor internal relations.

The Impact of Holding Salaries

Holding the salary of employees is never a solution. If management does this, what will they do if they succeed in retaining the employee, but after receiving their salary, the employee goes absent? An urgent meeting with those employees should be arranged with the management in charge to reach a mutual agreement.

Regards,
Harpreet Walia

Here, the point is, his friend is receiving threatening calls. That is more important than the employee retention issue. Management will find other employees to work with. Employees come and go. Why should the management pay those who are certain to change jobs, whatever the reason may be; that is secondary. The primary issue is: who will take responsibility if any physical harm happens to her? What would you do if someone threatens you to face consequences? Innocence, hard work, mutual talk, compensation will happen later on too.

Dear Dev, from the text, "she was told to put on hold" indicates a significant mistake on the part of your friend. It reveals she has put on hold the salary of employees merely based on verbal instructions without obtaining written instructions or subsequent written confirmation duly justified with proper reasons from her operations manager.

It is important to note, 30 persons cannot be wrong at a time, as against the one (operations manager). The operations manager must be at fault in mistreating the employees en masse and openly leading to their revolt. So, he must have made your friend a tool against those employees. But the consequences will have to be borne only by your friend, not by the operations manager, who is behind the curtain.

Mind it, such types of verbal instructions from the operations manager can cause havoc in the organization and can prove to be dangerous for the health of the organization in the long run if all the employees of the organization decide to go on strike or take the management to the court of law for the unlawful holdup of their salaries.

If she wants to save herself, she must get written confirmation from the operations manager and official approval from the Head of HR operations. The earlier, the better if she wants not to be labeled as the most inefficient employee of the company. If the operations manager avoids confirming his instructions in writing, she must release the salary of employees. She cannot withhold the salary without any genuine cause, like an act of formal punishment to the employees.

Regards,
PS Dhingra
Vigilance & Transformation Management Consultant
Dhingra Group of Management & Educational Consultants
New Delhi

I think Mr. Dhingra is right on this. No action to hold someone's salary (that too not of one but of thirty) without any written documents from the operational manager is a fault of your friend. She should, first of all, take in confidence the employees, explaining the situation. On the other hand, she should take a written instruction for holding salary from the operational manager.

Apart from all this, why keep employees who are not faithful to your company? If the statement of the operations manager is true, just pay them their dues and get them out of your company. You cannot force someone to be loyal.

I wonder where Dev, who started the thread, has disappeared. What we should really be doing is asking Dev for clarifications and requesting that Dev give complete details of the scenario: the age and size of the company, whether the instructions were oral or written (as pointed out by Mr. Dhingra - the solution depends on that issue), the reason behind the manager's views that all thirty will leave if they are paid. For example, it is possible that their manager has left to join a competitor and is enticing them to follow him/her; the length of service of the staff, etc.

Have a nice day.

Simhan
A retired academic in the UK

Hi!

Ask your friend to talk to the concerned person and request them to provide a letter for the stop payment. This letter can then be shown to the employee as well as their relatives.

With regards,
Mukund

I agree with what job_connect_consultancy said, "Get them to sign a contract where the employees need to sign up and give assurance that they are not looking for a change." This is a good option.

Secondly, I also agree with what Mr. psdhingra says that your friend should get a written letter from her managers describing their decisions, which also shows their responsibility.

Steps to Address the Situation

In my opinion, quick action should follow like this:

Step 1: Get a written letter mentioning the decisions of her managers as evidence.

Step 2: Hold a meeting for all to fill the communication gap and sign a contract between the 30 employees and her managers.

Regards,
Shiva Kumar

As an HR Manager or Executive, managing the human resources of the company is one of your main duties. At times, you even have to advocate for the employees. If 30 employees are planning to quit, then there must be some serious issues at the operations level such as:

• Ill-treatment (partiality based on religion, caste, language, gender)
• Incentives not paid in the past
• Better work environment and wages offered by a close competitor
• And so on.

"There is no question that doesn't have an answer," similarly, "there is no problem that doesn't have a solution." Solutions can be sourced or created based on the level of understanding about the problem. In simple words, first try to probe and understand what's provoking them to consider quitting, and then discuss the same with the higher authorities in the company.

If the higher authorities start ignoring your suggestions, inform them that today the number is just 30, but tomorrow it will surely double, and then things will start changing. The police are not required here; just put yourself in the shoes of those employees and understand what is troubling them.

Someone's suggestion about making them sign an agreement:
"Get them to sign a contract where the employees need to commit and assure that they are not looking for a change."
The above idea may make you feel better, but a group of demotivated employees can do more harm to both you and the organization.

Have all communications by email only, not verbal communication.

This is my opinion about the problem you are facing. Finally, I would like to say one thing: no employee wants to get into any trouble with you or anyone unless they (or their salary) are in trouble.

Regards

It's surprising that non-payment of salary to 30 employees without any valid reason is not justified. This also sends a bad message, and the name of the organization will be maligned. I think if anyone goes to court, the person withholding the salary without any reason will be held accountable in the eyes of the law. Be careful when dealing with such situations.

Regards.

Dear friend,

You need to pay their salaries ASAP; otherwise, they can file a case in the labor department under the Timely Payment Act. According to the act, a minimum penalty of 10 times the wages can be demanded.

Yes, I also agree with Mr. Dhingra. You cannot hold the salary of an employee for an uncertain period without any cause.

Shish Ram Uniyal
09811681660

Addressing Salary Hold and Employee Retention

Holding salary is an unfair practice. People who are not leaving right now will start looking for a change. What is required is a Compensation & Benefits strategy that will address the issues the company is facing. Why is your company being treated like a nursery of talent? Set up a training institute if there is a demand for experienced people. When these people join, they are greenhorns, and the duration spent in the company is less.

Alternatively, in the same fashion, set up a profit center for training if the skills imparted are in high demand. Define a career path for how many people can be given a career. Have a retention bonus for good performers who are loyal, implement a skill-based pay, build a strong brand, and share more details so I can advise.

Please note that at the first instance, you cannot hold the salary of any employee without having any legal issue against them. Your management is engaging in unfair labor practices and acting against the law. According to the Payment of Wages Act, your company is required to pay its employees on the declared payday. If the company has not paid any employee on the payday, a notice must be provided indicating the next payment date. Failure to make the payment would necessitate the deposit of the salary with the office of the Labour Commissioner, along with a reason for the delay.

Under no circumstances can you withhold anyone's salary unless serious misconduct has been committed by the concerned employee. The law does not support such actions by your management, and they will face consequences if someone takes legal action. It is important to understand and adhere to the law. Your management cannot engage in activities that violate the law.

Please review and ensure compliance with legal requirements.

Thank you.

Regards

Dear Devika,

Holding the salary of a person just because he/she is going to quit is not the right thing to do. If that is so, then your friend should hold the salary of all employees in the organization because once they get their salaries, they will quit. Does this make sense? It really does not make sense.

Many of our site members have given valuable inputs. I have some to add here, and obviously, these inputs will only add to the overall discussions that have been going around here.

Legal Implications of Holding Salaries

Holding salaries is like bonding, and it has a lot of legal implications. Just because one person has told to hold the salaries of all employees does not mean that it has to be done, especially for a large number of employees (30 employees). As an HR professional, it is the duty of your friend to check out what the matter is. If the 30 employees have already submitted their resignation letters, then the issue is different. If they have not submitted their papers and your friend is acting on hearsay, then she will land in deep trouble tomorrow because the operations manager will merely say that he/she did not mention anything about holding salaries of employees. During such times, HR is always the first to be blamed, even if HR is acting at the behest of someone else/management.

I would request your friend to release the salaries with immediate effect. In today's world, where the psychological contract between employee and employer has undergone a lot of changes and it is a free world where one can pursue any kind of career he/she wishes, it is against the law to hold one's salaries for flimsy reasons.

Addressing the Issue with Management

It would also be appropriate for your friend to take up this matter with the higher management and get things sorted out immediately.

Behind all this, I do see that the operations manager is at fault because he/she may have misbehaved with the staff; otherwise, employees resigning en masse is always an exception, never the rule.

I hope the above inputs will provide you with the direction to help your friend in this hour of crisis.

Regards,
Tejas Subrahmanya
Associate Professor

Difference of Opinion on Resignation Matters

Dear Tejas, thanks for your valuable input. However, I have a difference of opinion with you to a certain extent on the resignation matter, as you have stated, "If the 30 employees have already put in their resignation letters, then the issue is different."

Even if the employees en masse intended to or have already submitted their resignation letters en masse, the matter needs proper investigation about the cause of such a drastic decision of mass resignations. Still, the management does not have the right to withhold their pay for the work they have already completed. Resignations or terminations of services are regulated by the conditions of the agreement between the management and employees at the time of their appointment. The management can only withhold their acceptance of resignations if those conditions are not fulfilled by the employees but does not have the right to withhold their salary simply because one manager doubts that the employees may resign en masse. By holding their salary, the management would be engaging in blackmailing tactics, which are illegal and unethical, to prevent employees from resigning against the provisions of the agreement.

If employees have decided to resign en masse, that clearly indicates bad management policies or mass tyranny and misbehavior by the operations manager. In that case, the operations manager needs to be dismissed. The question arises, how could the operations manager know the intentions of all 30 employees and presume that they would resign?

PS Dhingra
Vigilance & Transformation Management Consultant
Dhingra Group of Management & Educational Consultants
New Delhi

Tejas, your response to Devika's query about holding salaries based on the assumption that employees will quit is appreciated. It is not appropriate to withhold a person's salary simply because they are resigning. If that were the case, your friend should withhold all employees' salaries because eventually, they will quit. This logic does not make sense.

Many of our site members have provided valuable insights. I have additional points to contribute to this ongoing discussion.

Legal Implications of Holding Salaries

Holding salaries can create legal issues as it implies a form of bonding. Just because one person suggests holding all employees' salaries does not mean it should be done, especially for a large number of employees (30 employees). As an HR professional, it is your friend's responsibility to investigate the situation thoroughly. If the 30 employees have already submitted their resignation letters, then the situation changes. However, if they have not submitted their resignations and your friend is acting based on hearsay, they may face trouble in the future as the operations manager could deny instructing the withholding of salaries. During such times, HR is often the first to be blamed, even if they are following management's orders.

I advise your friend to release the salaries immediately. In today's world, where the psychological contract between employees and employers has evolved, and individuals are free to pursue their desired careers, it is unlawful to withhold salaries for flimsy reasons.

It would be wise for your friend to escalate this matter to higher management and resolve it promptly.

Despite everything, it seems the operations manager may be at fault for potentially mistreating the staff; otherwise, mass resignations are usually an exception, not the norm.

I hope these insights provide guidance to assist your friend during this challenging time.

Tejas Subrahmanya
Associate Professor

Dear Dev,

From the text, "she was told to put on hold" indicates one blunder mistake on the part of your friend. It reveals she has put on hold the salary of employees merely by some verbal instructions without getting the written instructions or subsequent written confirmation duly justified with proper reason from her operations manager.

It is important to note, 30 persons cannot be wrong at a time, as against the one (operations manager). The operations manager must be at fault in misbehaving with the employees en masse and openly leading to their revolt. So, he must have made your friend a tool against those employees. But the consequences will have to be borne only by your friend, not by the operations manager, who is behind the curtain.

Mind it, such verbal instructions of the operations manager can cause havoc in the organization and can prove to be dangerous for the health of the organization in the long run if all the employees of the organization decide to go on strike or take the management to the court of law for the unlawful hold-up of their salaries.

If she wants to save herself, she must get written confirmation from the operations manager and obtain official approval from the Head of HR operations. The earlier, the better if she wants not to be labeled as the most inefficient employee of the company. If the operations manager avoids confirming his instructions in writing, she must release the salary of employees. She cannot withhold the salary without any genuine cause, like an act of formal punishment to the employees.

PS Dhingra
Vigilance & Transformation Management Consultant
Dhingra Group of Management & Educational Consultants
New Delhi

Dear Sir;

She has received an email from the operations manager with the names of the employees.

Dear All,

I appreciate the inputs you have given. I would like to mention that my friend was informed through an email, which included the names of all the employees whose salaries are to be put on hold.

As far as the age of the company is concerned, it was started 3 years ago. The total strength is approximately 150. Now the main concern is that the hierarchy is flat. My friend directly reports to the MD of the company. The same company has a sister concern dealing in the same business, and the HR Manager of that company looks after the affairs of both companies. The company in question has only one HR, and that is my friend.

Recently, my friend forwarded her resignation to the management, which was rejected. She wants to leave the organization as soon as possible, but they are not relieving her, and leaving without following the proper process won't be fruitful.

She has been working with the company since it had 15 employees. The only thing I would request of you all is to let us know, if she is not relieved, what can be done and the issue which is ongoing in the company. Can any legal action be taken against her? If yes, what can be done to avoid the situation?

Regards,
Dev

Advice on Handling Salary Hold Situation

Read the comments carefully given by Mr. P S Dhingra and ask your friend to take written confirmation from the HR Manager on the email forwarded by the Operations Manager. Remember, it is the duty of the HR department to save the company from all legal aspects. The Operations Manager is right as far as his work is concerned, but the liability for holding the salary in the labor court will be the responsibility of the HR department if they act illegally without informing the management or guiding the management.

Regards,
Manish Gupta

Addressing Salary Withholding and Resignation Issues

There are now two different issues: (1) the withholding of salary of employees, and (2) the resignation of your friend. Please ask her not to try to mix up both issues. Try to tackle first the present fluid situation created by the operations manager's instructions. Even if the resignation is accepted, that would not be an honorable solution for your friend, as she would be seen as escaping from accepting the challenge of her job.

Now, since your friend has received the email confirmation of the names whose salary had to be stopped, take a printout and submit it to the MD for approval. Ask whether the salary should be withheld or released due to the fluid situation and commotion created by the employees and their relatives. Clearly state the legal implications against the agreements made by the management with its employees.

She must keep a copy of the printout in her personal custody for her own safety to be used when needed, as sometimes management prefers to access and delete such evidence from official computers/mailboxes if it goes against them.

In the meanwhile, she should not be afraid of telling the truth to the affected employees. Only after successfully handling the situation should she consider pursuing her resignation. It may be advisable for her not to remain in that organization after that. This would add a feather to her cap as she would have successfully neutralized the challenge faced in her career.

Regards,
PS Dhingra
Vigilance & Transformation Management Consultant
Dhingra Group of Management & Educational Consultants
New Delhi

Seeking Guidance on Resignation and Legal Concerns

I appreciate the inputs you have provided. My friend was informed through an email containing the names of all employees whose salaries are to be put on hold. The company was established three years ago, with an approximate strength of 150 employees. The main concern now is the flat hierarchy. My friend reports directly to the MD, and the HR Manager of a sister concern oversees both companies. The company in question has only one HR, who is my friend.

Recently, my friend submitted her resignation to the management, which was rejected. She wishes to leave the organization promptly, but they are not releasing her, and leaving without following the proper process would not be fruitful. She has been with the company since it had 15 employees.

I would like to request guidance on what can be done if she is not relieved and regarding the ongoing issue in the company. Can any legal action be taken against her? If yes, what steps can be taken to avoid the situation?

Regards,
Dev

I think without any fault of the employee, the employer cannot stop the salary of any employee. I believe ethically and legally it's a very wrong practice. Seek legal advice and then approach your management accordingly. Based on my knowledge, your management will also be convinced.

As some of them have suggested, if you make all of the people sit under one roof, it creates verbal explosions. If your friend is going to file a case against the employees and parents, then the reason behind them threatening your friend comes to the limelight, wherein they can file a case against your friend and the person who has instructed to hold their salaries.

As suggested, kindly ask your friend to have written communication from the operations manager/higher authorities immediately.

What's there to feel sorry for? I guess you have not read the thread properly. Please read it from everyone's point of view, both employer and employee. Also, understand what the original person (the thread poster) is looking for. And what's there to feel ridiculous about? I hope you also agree that not all employers get loyal employees; otherwise, cheating and fraud would not happen in organizations. Kindly read it again.

One thing I can tell you is, "We can't force the employees to stay with us." Even if we don't give them their salary, they can leave the company and file a complaint with the labor department. So, what I recommend to you is to try talking to the management of the company.

Regarding your friend, she can inform the employees that management has instructed her to put their salaries on hold. She is just an intermediary between the employees and the management.

I don't think it is legal to withhold salaries for work done. HR should provide guidance in the organization to ensure that operations do not receive illegal instructions. There is no justification in law to withhold salaries, and your friend should be brave enough to relay this to operations. If salaries are to be withheld, it should be done against her professional HR advice. HR should not be used to retain employees in the company by withholding salaries. The company needs to motivate and retain workers through other means. This approach simply will not work and has started to backfire with the threats. It may escalate to a lack of confidence by existing employees and lead to even more turnover. The worst-case scenario will be a strike.

Dear All,

I am working in India, and my organization has held all the employees' salaries (one division employee) since June 2010 without any intimation. They have not provided any response or replied to any emails. Salaries have been withheld without any prior notice. All employees are diligently attending the office and performing their duties daily, sending daily attendance reports to the local division office.

Please suggest how we can retrieve our salaries or provide us with some legal guidance.

Thank you,

Rajiv Kumar