How Can HR Tackle Late Salary Payments Without Straining Management Relations?

I don't wish to disclose my firm's name—a decent-sized firm. The problem is the late payment of salary. Payment is made to employees only 7 days before the month's end. Being an HR professional, I have tried explaining to my management the negative consequences and suggested making the payment at least by the 5th or 7th day of the beginning of the month. However, it fell on deaf ears. Previously, employees have raised this concern individually and collectively. But when they did, they were harassed, and the employees were forced to leave the company. The management is not interested in making any changes. I am very concerned for all my employees and wish to make changes. Please guide me on how to deal with such management without hurting relations.

You have mentioned the problem—definitely something that ought to be handled, if not entirely avoided or ignored. Have you spoken to the management regarding the probable causes or reasons for the delay? What are they saying regarding the reason(s)—both from their perspective and your understanding of what they say—since the possible solutions would depend on the reasons.

Regards,
TS

Dear Deepika, It's nice that you do not want to hurt your relationship with management and are a caring HR. Your problem is quite similar to many HR professionals. Some companies fully depend on periodic receivables even for statutory payables. They take it for granted for salary payables too. This might be their nature of running the business. In the meantime, the employee suffers, and performance levels go down; it's obvious they will look for some better opportunity. Ultimately, the business suffers, and HR personnel will be accountable for employee turnover. This is a trend in some service sectors and distribution mid-sized and small companies.

So, keep yourself on the safer side. Talk to your boss or some key person in management whom you feel comfortable with and tell them about the employee's problem and your HR concerns. I hope your management is aware of wage legislation. If not, try informing them through any suitable medium of communication.

Regards, Parth

Deepika Parth is absolutely right. This is in contravention of the wage legislation and is sure to get the employer in trouble should someone choose to seek judicial help on this.

As an HR professional, you are within your purview to advise your employers of this noncompliance and the potential implications should they choose not to remedy their actions.

You have told the management about the problem, and I assume you have also informed them of the legal consequences. Some business owners believe that paying wages late or withholding a month's wages ensures that employees don't leave without notice (as they would lose close to a month's wages, which is expensive for most employees).

If that is the case, then there is no solution. You can either decide whether you wish to stay in a company that is deliberately delaying salary or leave for a better employer. You cannot change the world (or an employer who is not ethical).

Please let me know if you need any more assistance.

Thank you.