How Can My Friend Speed Up His Pending Full and Final Settlement from His Former Employer?

One of my friends left his company in April 2012. However, his full and final settlement is still pending, and every time he receives a reply from his seniors and HR team stating that it is under process. He asked me what actions he can take to expedite his full and final settlement.

Guidance Needed for Full and Final Settlement

Could you guide us on the further course of action as there has been no response from his company for the last two months?

Regards,

It is advisable to send a registered letter to the employer and demand the F&F or seek the help of an industrial lawyer.

I will advise your friend to escalate this matter to senior management and, if needed, visit them personally to make them feel morally responsible. There is no need to use bad words or derogatory language; instead, present the facts and figures to make them feel accountable for not doing justice to you. Try this approach and best of luck.

Regards

My view is to look for a solution, both ethically and legally. Please draft a detailed letter addressed to the HR head about the situation, including the complete history of events and the responses you have received from the office. Send this letter via registered post. This approach may give them a chance to understand what is happening in their department and work on the full and final settlement. It may also be beneficial for you in the future if circumstances require legal action.

Regards

There is no easy way. Send a notice via registered post with AD. Then file a labor department complaint against them. Follow up your complaint via RTI. This will give impetus to your complaint as the labor department is very lethargic in pursuing complaints. What they usually do is forward your complaint to the same company and ask for a reply. They won't even follow up on whether the concerned company replied or not. This I'm telling you from a practical experience of a friend. The RTI reply was that we have forwarded your complaint to the company and haven't received a reply. My friend is now following it up with an appeal via RTI. I don't blame the company because they will always try to squeeze money out of employees, but I am embarrassed by government officials (I am talking about the undersecretary in the state government as APIO for RTI) who don't do their duty while taking our hard-earned money as salary and perks. I am planning to create a topic regarding this soon.

I believe you should write a letter to the senior manager stating that your last salary is pending and also inform them that you are in need of money. You have to wait until they process the payment. I suggest that you should not pursue legal action.

Regards,
Lipika

I agree with what Vivek suggested. Please send the detailed letter to the HR Manager via registered mail (AD). Best of luck.

Regards, Vijay

I worked in an organization for the past 8 years. I recently resigned from the company, completed the notice period, and today I received the relieving letter from my previous company. My former boss informed me that he has sent my resignation letter to the head office and has requested my full and final settlement. I would like to understand what exactly is meant by full and final settlement.

No communication for about a year is not correct. If there is an HR team, the organization must be reasonably big. HR must have communicated within one month the status indicating the amount payable or receivable. Many HR managers think that if there is a dispute, silence will help and the employee will vanish. It is not a correct practice.

Steps to Address Pending Settlement

Your friend can send a complaint to the following:

1. Payment of Wages Authority
2. Concerned inspector (Inspector of Factories or Labour Inspector under Shops and Establishment Act)
3. Send a copy of the complaint to the Chief Inspector of Factories or Chief Labour Commissioner
4. Mark a copy to Secretary Labour Department

Wait for a month. If nothing works, initiate action under the Payment of Wages Act (if your wage is within the prescribed limit under the Act).

Full and Final Settlement Process

Full and final settlement is applicable in the case of an employee's separation from the organization. The components of F&F settlements include broken period wages, allowances for the broken period if any, and leave encashment dues as per the prevailing rules of the organization.

In the deduction column, there are Income Tax and recovery of advance if any, and PF for the broken period attendance days till the date of separation, etc. This settlement excludes PF and Gratuity settlement, for which one has to claim separately by filling in the requisite forms.

Regards,
bkmohanty
Cypress Management Associates
[Phone Number Removed For Privacy Reasons]

Employer's Obligation for Full and Final Settlement

Your employer is legally bound to make a full and final settlement of your outstanding dues after your release from the said organization. They are duty-bound to release CPF and Gratuity within 30 days from the due date, subject to your submission of a withdrawal application form to them. Remaining dues should also be released within a reasonable time.

In case they are not released on time, you may lodge a formal complaint against them to the Grievance Officer of their Administrative Ministry with a copy to the Labour Secretary. You may also lodge a complaint before the concerned Regional PF Commissioner for CPF and to the concerned ALC & CA for Gratuity. After giving a reasonable opportunity for a hearing to both sides, they will pass necessary orders.

It is your fundamental right to claim Gratuity and PF after your retirement.

Yes, I agree with Mr. Moitra. While full and final settlement is required to be released immediately upon separation, PF & Gratuity (minimum rendering of service for 5 years) should be processed within 1 month of submission of the requisite formats.

Regards,
B.K. Mohanty
Director
Cypress Management Associates