Employees Left After Long Absence: How Can We Recover Their Final Settlement Amount?

Employees who have been with us for the last three years have decided to leave after being absent for an extended period. Subsequently, they submitted their resignation from service. We have prepared the full and final settlement, with the remaining amount in the debit balance. Please advise.

You can withhold his provident fund or other dues that are due from the company. You can issue him a legal notice after consulting the legal adviser, subject to the quantum of the amount. This is because normally legal advisers charge Rs. 1200 to Rs. 1500 in fees. If the recovery is ten times more than the fees, you can issue him a legal notice. However, please note that the recovery procedure through court is lengthy.

Regards,
Deepak M.

The employees have been working with your organization for 3 years, which means they are confirmed employees. They have been on leave for a long time. Have they taken prior approval from their immediate boss or HR in writing? If not, you can issue an absconding notice to them and advise them to report for duty immediately. If they do not do so, you can take legal action with documentary proof of outstanding/debit balance.

Regards,
Rahul

Unless the amount due from the employee is more than $30,000, it is not worthwhile to pursue the matter vigorously. The legal expert's fees, time, and effort involved are not worth it, especially since the chances are very low in this case.

Suggested Actions for Debt Recovery

I suggest you send a letter advising repayment of dues, withhold acceptance of resignation, and delay the relieving procedure pending repayment. Follow up your letter with a stronger reminder every three weeks and forget it after six months. Putting pressure through known common sources has the best chance of getting back the dues.

Employees working with us for the last 3 years have now decided to leave after a long period. Consequently, they have submitted their resignation from service. We have prepared the full and final settlement, with the amount showing as a debit balance. Please advise.

Full and Final Settlement for 3 Years of Service

What is the full and final settlement for 3 years of service, considering it falls short of 4 years and 240 days, therefore no gratuity is accruing? Additionally, PF is not directly paid by the company. The settlement may include leave encashment, any bonuses, and accrued salary that need to be disbursed. In my opinion, the settlement amount might be relatively small, making it less desirable to pursue legally. Apart from statutory payments like gratuity and PF, you can adjust the debit balance for non-statutory claims.

Issue him a notice stating that until the amount is recovered from him, his resignation won't be accepted. If he intends to join another company, he cannot do so until his resignation is accepted by your company. Furthermore, if he joins elsewhere, a single person cannot have two PF accounts.

You can send a reminder with the following draft.

NOTICE BY REGISTERED A.D & UPC.

Date: .....2013

To,

Mr. ........................

......................................

......................................

Dear Mr. ......................,

This notice is addressed to you as follows:

That you left the Company without obtaining a relieving letter and also without handing over the documents/articles belonging to the company, which is a criminal breach of trust against the Company. The Company reserves its rights to initiate civil and criminal proceedings against you as required. Following is the list of articles that should be returned by you to the Company:

1.

2.

3.

4. That, as per the books of accounts maintained by the Company, as of date, a sum of Rs. ........./- (Rs. ......................... only) is due and recoverable from you, which you are legally liable to pay.

5. That in addition to the above amount, you are also liable to return the articles belonging to the Company as mentioned in Para 3 above.

6. That we have constantly been demanding payment of outstanding amounts payable by you so that the account of dealings between you and the Company is settled/squared up. In this regard, on numerous occasions, we have reminded you through telephonic calls, but so far, you have neither made the payment nor acknowledged the reminders followed by the telephonic calls.

7. However, you are given one more opportunity to clear the outstanding dues of Rs. ........../- (Rs. ............................................... only) along with the interest @ 18% p.a. from the date of accrual to the date of actual payment, and return the articles belonging to the Company within 15 days from the date of receipt of this notice. Failing which, appropriate civil/criminal proceedings would be initiated against you before the competent Authority/Court of Law, and in that case, you shall be totally responsible for all the expenses and subsequent consequences.

Please take notice accordingly.

Yours Faithfully,

Well, the best way to communicate with the employee is to send a reminder along with a warning. If you have received the resignation letter, please do not acknowledge receipt or approve it if you have not already done so. Additionally, inform the employee that documents such as the acceptance of resignation, relieving letter, and experience certificate will only be provided once any outstanding dues are settled through repayment.

This approach could be detrimental to the employee's career as they would be unable to showcase their work experience at your company. If they do manage to provide this information, it may result in negative feedback during background verification, making it challenging for them to secure a new job.

Furthermore, if the employee fails to respond and clear their dues, you have the option to file a legal complaint against them. This action would be justifiable based on the amount owed, including additional expenses such as consultation and lawyer fees, as well as the time required to resolve the issue.