Facing Salary Delays and Legal Hurdles: How Can My Friend Claim His Due Wages After Resignation?

Dear Seniors,

One of my friends was working with a project-oriented company. Due to a severe financial crisis, they were not paying salaries regularly for the last 6 months. For example, the salary for the month of July 2011 was paid in the third week of October 2011, and the August salary was paid in the last week of December. During this period, the company never officially communicated with the employees about the delays or provided any assurance regarding when the salaries would be paid. This situation led to frustration as my friend was unable to manage household expenses, housing loan EMIs, medical expenses, etc. As a result, he secured a job with another organization and resigned from the company in December 2011, giving a notice period of one month from December 1st to December 31st, instead of the two months specified in the appointment letter.

Due to stress, strain, and mental tension, my friend fell ill and could not attend work for more than 20 days during the notice period. He informed the HR department of his absenteeism through SMS and requested the management to appoint someone to take over his responsibilities so that the company would not suffer and he could be relieved on time. Unfortunately, the company did not consider his request, and he was unable to hand over his duties before December 31, 2011. Although his resignation letter was acknowledged, there was no official confirmation of whether it was accepted or rejected. He left the organization on December 31, 2011.

Now, his colleagues have informed him that the salary for September was paid in the first week of January 2012, but his pending salary from before his resignation is being withheld. Can anyone provide advice on how he can proceed to claim his due salary? Is his decision to give a shorter notice period legally valid? What legal actions can he take under labor rules to obtain his rightful dues?

Regards,

Charudas. M

Your friend can approach the concerned Assistant Commissioner of Labour, who is the authority under the Payment of Wages Act. Before that, let him write a letter to the management, i.e., his HOD, HR Head, and even the MD/Director, stating that his salary dues need to be released after deducting necessary statutory deductions. Also, request the full and final settlement within 15 days from the date of receipt of the letter. Mention that failing which he will approach the authorities under the Payment of Wages Act.

After waiting for 15 days, he should approach the ACL/Deputy Commissioner of Labour in the concerned area.

Regards,
Kamesh

Let's not get sentimental and look at the logical part of the case. I am sure that if there were financial problems in the company, then that would have affected most of the employees of the organization, and all would have gone through a similar amount of stress and strain. So, I would like to ask:

1. How many employees were there in the company on 30th June 2011?
2. How many employees resigned from their jobs from 1st July to 31st December?
3. Is your friend in a position to submit the Medical Certificate to justify his sickness?
4. I am sure the management would have told its employees about the financial crisis they are going through. I am not clear on what you mean by "Official Communication."

Thanks,

Sanjeev

Steps to Resolve Employment Dispute

After going through this, I would suggest asking him to make a written complaint to the REPFC along with employment proof. He needs to meet them personally because this is not a small issue.

The most important thing is that he has no proof of his resignation and was also on leave, which was obtained without prior approval. Informing the HR personnel about leave via SMS was not the right and systematic procedure, and this will be counted as a mistake. I understand that he was not well or was disturbed by this issue, but he needed to get acknowledgment for the same by his Superior/Senior/Boss. Not doing so is another mistake.

As you mentioned, he still doesn't know whether his resignation has been accepted by his Boss or forwarded to HR for further action. Therefore, he must visit them and discuss this with his Boss and HR person to understand the actual problem.

Financial Issues and Legal Considerations

As you said, there was a financial problem with the Company, and consequently, they were unable to pay him on time. He had to take action and joined another company, which is understandable given the situation. I won't say he did anything wrong, but at this point, he must visit them to clarify things before pursuing legal action. Even the management has never denied paying dues to him, as stated in your query, so he and you need to understand this too. I also agree with Mr. Sanjeev; sometimes management has to take such actions during crises or related problems.

As he is now working with another company and wants to get his dues, the first thing he needs to do is visit them.

If he still finds anything wrong, he can go to the REPFC.

Addressing Resignation and Unpaid Wages

You have posted that the resignation has been acknowledged. It would have been appropriate to write to the appointing authority, Head-HR, about the situation the employee has been facing due to non-payment of wages on time. For example, not being able to meet household expenses, medical expenses, and having to borrow should be communicated in a gentle manner.

If the employer has not been able to pay salaries for many months at a stretch, the employer becomes unworthy of being employed with. The employee should approach the appropriate offices and request to waive the notice period and notice pay in such a situation. The employee may submit a leave application and get it approved. Salary cannot be withheld.

If the employer is genuine, the employee should be able to handle the situation and will need to apply reasoning and persuasion skills. If nothing works, the employee may approach the office of the wage inspector.

Dear Mr. Charu,

Like many employees, your friend also committed some tactical mistakes. In my view, they are:

1. Not giving an adequate notice period before resignation or actual relinquishment.
2. Not keeping a proper record of communication with the employer, HOD, or appointing authority.
3. Availing leave or absence during the notice period.
4. Not preparing or handing over the charge report to the next in command or reporting official.
5. Not obtaining a No Due Certificate before leaving.
6. When there was no response, no proof to show efforts to contact the right person in charge, etc.

Yet there are some points that may help if needed:

1. If you have kept intact your SMS records, you may arrange an authenticated printout of such communication to your office, seeking to be relieved and requesting them to appoint a replacement.
2. It is good that they acknowledged your letter without confirming yes or no. This could be used as a real weapon.

DO's:

Having done so, you may take the following actions:

Send a detailed letter narrating and highlighting the efforts you have made in formally communicating your notice and subsequent events. Give them a 15-day notice (don't ask them to send a relieving letter now; consider their acknowledgment as acceptance of your resignation) to settle all your dues except for PF. You can file PF Transfer forms to them through your current employer. Enclose relevant claim forms. Send them by Registered Post Acknowledgement Due, and copy them by email as well. Keep copies of all these records. Provide your bank account details. Try to call them or send a telegram, keeping a record of all communications. After 20 days, send a legal notice stating that you are raising an industrial dispute and seeking the intervention of the respective Labour Commissioner (assuming you are covered under these Acts). The rest will be followed up by the advocate. These are some thoughts, and add any other suggestions from others.

All the best.

Kumar S.