Is an Employee Who Left Before Increment Processing Eligible for a Pay Raise?

Dear Team, We have an employee who left our organization on the last working day of October 2012, and we processed our increments in December 2012 for all employees working on the company’s rolls from April 1, 2012. Now, this employee is requesting his increment amount for the period from April 1 to October 31, 2012. Could you please confirm if he is eligible to receive this amount since he left the organization before the increment processing? Please advise.

Regards,
Ranjeet

He is not eligible for an incremented amount as he left the job. Don't worry; he cannot take any legal steps for the same.

Dear Akhil, Thanks for the revert.

Request for Assistance in Drafting a Reply

This is with reference to your mail dated 28/2/2013, which is in reply to my request for the release of arrears of my salary consequent upon the enhancement of salary for executive grade posts in ______. I have gone through the contents of the mail. It has been stated that there has been no revision of the salary of the executives, but it is only a special increment given to those employees who were on the attendance roll as of 30/11/2012. In this connection, I wish to inform you that the special allowance is nothing new, but it is in lieu of the annual increment payable to the employees for their past year's satisfactory performance. This increment is payable to the employees in accordance with the current rules/practices.

Insofar as ______ Company is concerned, a belated order is issued in September/October every year for the grant of increment, special allowance, promotion, etc., to the employees. This order is made applicable retrospectively with effect from 1st April of the respective year. No stipulation is made in the order that only working employees on the date of issue of the order would be eligible for the benefits. As the order is applicable retrospectively with effect from 1st April of the year, all the employees on the attendance roll are supposed to be entitled to the revision of pay/grant of special allowance, etc. Any decision contrary to this is not tenable in law.

Thus, since I was on the attendance roll of _______ from 1/4/2012 till 31/10/2012, I am entitled to the special allowance available based on the order. It is, therefore, requested that the arrears accruing on the issue of the order may kindly be released.

Please help, this is urgent.

Regards, Ranjeet

As per company policy, you are not eligible for arrears as you left the company in October 2012.

Thank you.

Can you send me references to some cases where it has been proven that increments are not the right of the employee?

Full Case Explanation

We have transferred the employee to another city, and after some days of leave, he finally resigned from the company. We processed our increments for employees who were on the rolls from April 1, 2012, and paid the arrears. Since he resigned on October 31, 2012, we have not processed the same for him. Now, he is asking for the annual increment for the period until October 31, 2012, explaining that it was based on last year's performance only.

I need to send my reply to the employee as I know he will again complain to higher management or take it to court.

Please advise on how to draft the response.

Regards,
Ranjeet

I don't have any case study at the moment. He cannot file the case as he has taken full and final payment on a duly discharged voucher. Increment is the prerogative of the employer, and an employee cannot claim it once he has resigned and taken full and final payment.

Once the employee has resigned and received the F&F settlement, they are legally not entitled or eligible for any increment or other benefits. I am surprised why you are asking for a draft reply. In fact, you need not reply at all. Why are you wasting your valuable time on such a vague demand? The employee can't do anything against the company on legal grounds. Let them write emails to whomever they want. I hope you can easily convince the management of your company on this issue.

Regards, Prabhat

Thanks for your replies, but I just want to be sure on the safer side. Our higher management has a more people-oriented approach, so we have to sort out the queries of all staff who might have resigned. Your valuable guidance helped me a lot.

Regards,
Ranjeet

Increments to employees are extended based upon the preceding year's fair performance. The aspect of working 240 days in the increment year is also considered in some organizations. The employee in question was on the rolls when the increments were announced by the company, though arrears were disbursed in December. In my opinion, the employee is entitled and rightly asking for the arrears of seven months' increment, despite having received his full and final settlement. I hope the people-oriented approach of your management will certainly help in settling the issue amicably.

With warm regards,

R K SINGH

Increment Policy and Eligibility

After going through the responses given, I feel that you have been guided rightly by Mr. Akhil Gupta. In my opinion, though increments are decided based on the past performance of employees, the fact that it is given is to motivate employees to continue their good performance in the succeeding years.

For example, if you had decided to promote the same person based on past performance or if you have decided on a wage cut for him due to the company's poor performance and the decision was taken in December 2012, and he has left the organization in October 2012, can you promote him or effect the wage cut, as he is no longer on the rolls of the company? Even assuming you promote him despite the above fact, will he come back and rejoin, as he has already left the organization for reasons whatsoever?

The crux of the matter is that an increment is a policy decision of the management and will be effected only for those employees who are on the rolls of the establishment on the date of the announcement, irrespective of the fact that it is given retrospectively.

The only aspect the left employee is entitled to is a bonus for the period he served from April 2012 to October 2012, and that too if he is entitled either as per statutory provision or company policy (ex-gratia if it has been in practice in the past).

Regards,
M.V. Kannan

Mr. Akhil and Kannan have correctly stated that he is not eligible for anything now as he was not working with the organization at that time. Please also review your bonus, salary, and appraisal processes. It should be stated in the policies that if a person leaves before the completion of the year, then he will not be eligible for any bonuses, etc.

Responding to Emails

First, you should not reply to his emails of this nature. But if you choose to, please briefly outline the reasons why he is not permitted.

You can also mention that since you provided salary hikes this year, he is sending such emails. What would he have done if you had decreased salaries and other benefits? Would he have returned that amount? If his Full and Final settlement is completed and he has signed the documents and accepted the amount, then he cannot take any further action.

Regards