Abrupt Employee Exit: Can Companies Legally Block PF and Benefits Without Notice?

Hi!

In case an employee leaves the job abruptly without submitting the resignation letter or without giving notice, which has become quite common in the IT industry especially with juniors, can their PF withdrawal or other benefits like superannuation and gratuity be blocked? What legal rights does a company have? Please let me know.

Thanks, [Login to view]

Hi,

Regarding PF, you can't block or attach the PF of employees under any conditions.

Regards,
Prashant Patil

Hi,

You cannot withhold PF withdrawal for whatsoever reasons. If you do so, you will be penalized. If you refuse to send the withdrawal forms, the employee can send the forms to the PF authorities without obtaining your signature. The PF authorities will send the forms to you for your signature, and you SHOULD send back the duly signed forms within a week's time. Failing to do so will result in appropriate legal action being instituted against you.

Furthermore, the PF/Gratuity cannot be attached before any court of law. You could only block all his non-statutory payments, including salary.

Thanks,
Michael Nicholas

A big "No" for holding PF, Gratuity, etc. You can mention legal actions against such employees in your employment agreement so that if they leave the organization without resigning, then you can challenge them in court.

Regards,
Abhishek

My Dear,

This is all related to the social security of employees, and this cannot be held back nor can be denied. Appropriate action/challan can be taken in case of default. Even a loan taken by the employee cannot be adjusted against his due gratuity payment. I hope things must have now been clear to you.

Regards,
H R Singh

Hi,

As per the feedback given above, it is correct that we can't hold anyone's statutory dues, which is illegal. During the verification process, you can inform the current employer that the individual has not completed the clearance process and left without proper notice.

Regards,
Hemant Kaskar

Hi,

We can't withhold any statutory benefits from the employee. However, at the same time, we can initiate disciplinary proceedings and delay the process.

Albee :idea:

I agree with Michael. None of the Statutory Benefits can be put on hold just because the employee went absconding.

Meraj