Former Employee Requests PF Withdrawal After a Year: Can We Ask for Unpaid Dues First?

I require your kind advice on this matter. We had an employee working for about 4 years, who quit more than a year ago in 2012 because he found a better job opportunity. He gave only a 25-day notice instead of the required 2 months. After receiving that month's salary, he stopped coming to the organization as he wanted to join another organization early and was not willing to serve the complete notice period. He held a senior position. He did not even return for final settlement.

Now, after more than a year, he contacted HR asking for PF withdrawal. While we have no issue with processing that request, can we ask him to first settle his dues with the organization since he left without notice and still owes payment for the remaining notice period he did not complete? Let him pay the organization the outstanding dues, especially considering he did not leave formally.

Please advise.

You can ask the employee to pay the dues, but you can't withhold PF for that purpose. It is his choice whether to pay up; otherwise, you have to file a money claim.

Yes, I'm very much aware that we cannot withhold the PF process; however, we should at least ask that person to settle it properly.

Question on Employee Absconding and Claiming Dues

Also, I wanted to ask another question: if an employee absconds from the organization and then comes back later to claim compensation or final settlement dues, considering he was not part of PF and has no PF dues, only the salary... How long are we supposed to keep all the details and entertain, especially when the employee absconded and didn't leave with proper notice?

Dear Meenu,

There is now no dispute about your liability to pay his P.F. as you have also admitted your liability to pay it independent of F&F settlement. Now you want to claim salary for the shortfall of the notice period. What did you do during this intervening period of one year? Have you sent any communication informing him that he was unauthorizedly absent and further committed a breach of contract by not complying with the notice period? If not, probably a presumption can be drawn that you have waived the notice period and consequently your claim to wages for the shortfall of the notice period.

B. Saikumar
Mumbai

He is a senior employee claiming for his Full and Final (F&F) settlement and will definitely have an idea that he has not remained decorous in terms of his leaving or notice to the company. Therefore, yes, being a virtuous employer, you have implied your decision to make a final settlement with respect to the due payment of his remaining notice days without initiating any dispute. Whatever the reason may be, have this cleared, but make sure you take an acknowledgment of the settlement made for future prospects.

Yes, we sent him an email asking him to come and settle his dues.

Question on Employee Absconding and Final Settlement

Also, another question that I wanted to ask you was if an employee absconds from the organization after working for one month and then comes back after 6 months and claims his salary, what is to be done in this situation? What if an employee comes back after one year? What is the maximum time period for which we, as HR, are liable for his final settlement if there is a gap between his leaving and his claiming for final settlement? Please advise.

If an employee is absconding, you should immediately initiate steps as per standing orders, service rules, or terms of contract/appointment by sending him communication that his absence is unauthorized and that he is not entitled to any wages during the said period. He is required to report for duty immediately. Upon his reporting for duty, you can seek his written explanation for his unauthorized absence. If the same is not found satisfactory, you can initiate disciplinary action for the misconduct of his unauthorized absence.

If he does not turn up even after such communications and within the stipulated time prescribed under the "loss of lien" clause in the standing orders/service rules/contract, treat him as having lost his lien on the job or voluntarily abandoned his job. However, he will not lose his lien on the dues payable to him like salary, if any, bonus, if any, and gratuity, etc. His claim to these dues is not time-barred.

Regards,
B. Saikumar
Mumbai