Facing Delayed Salary After Resignation: What Legal Steps Can I Take?

I have been working in a BPO company since December 2012. Now, I am resigning from this company due to some personal reasons. I submitted my resignation letter on 16th July 2013, and currently, I am in my notice period as per the company's policy. My notice period ends on the 14th of this month. When I spoke with HR, they informed me that they would provide my previous month's salary, the current month's salary, as well as my 4 months' overtime after 45 days. This information was not mentioned in my contract letter, and they are currently holding my previous month's salary.

Please suggest as soon as possible what legal actions I could take against the company to receive my complete income this month.

Thanks in advance.

Regards,
Mr. Akhilesh Roy

You should have received the overtime pay up to June unless they are paying overtime once every six months. About holding your salary for two months, ideally, a company processes Full and Final settlement only on the last working day. Meaning, if you resigned on July 16th and have to serve a one-month notice period, your last working day will be August 15th. Since the 15th is a national holiday, your last working day is August 14th. All your dues, including salary for July and salary for the 14 days of August, will be paid together on August 14th. Additionally, if there are any other outstanding payments, they will be included as well. If there are any deductions to be made, such as for advance salary taken, they will deduct it from the Full and Final settlement and provide you with the net pay. I hope this clarifies your doubts.

As per my discussion with my company, they conduct the Full and Final settlement after 45 days of my resignation. Therefore, I cannot wait that long to receive my salary for the previous months. Could you please advise me on this as soon as possible?

Thank you.

Regards,
Akhilesh Roy

Procedure for Calculating 45 Days for Full and Final Settlement

Please let me know the procedure for calculating 45 days for full and final settlement. I gave one month's notice on 4th July, and my last working day should have been 3rd August. Now, should I calculate 45 days from 4th July or 4th August?

My company is not paying my full and final settlement, which includes reimbursement for May, June, and July, as well as the salary for July and 3 days of August.

Procedure for Seeking Assistance from the Labor Court

What is the procedure for seeking assistance from the labor court?

Regards

Hello Akhilesh,

You can talk to your HR and request an earlier release of your Full and Final settlement. Since you will not receive one and a half months' salary for the next month and a half, it could be challenging for you to manage financially.

You may suggest to HR that they release the F&F on your last working day. If necessary, they can hold the letters and release them after completing all processes. Alternatively, you could propose that they pay you at least July's salary so that you have some funds available.

Typically, when an employee resigns, the company needs time to inform the PF authorities and complete other formalities, which can take around 45 days. This may be the reason they mentioned collecting the F&F directly after this period. I recommend discussing this matter with your HR department and exploring options for negotiation.

Best of luck.

Simran,

The method of calculating 45 days in such cases, ideally, I believe, is from your last working day, for the reasons stated above. However, to be very clear on the process and practices followed by your company, why don't you directly ask the HR and the concerned person at your company?

All the best.

The HR is also a new person, and whatever we ask him, he says that he does not know anything, and we should ask the CEO who has to sign our cheques. Everybody is trying to make a fool out of it.

Addressing HR and Payment Concerns

The HR is also a new person, and whatever we ask him, he says that he does not know anything and suggests that we should ask the CEO, who has to sign our cheques. It seems like everyone is trying to make a fool out of it.

Note that just because HR is new, he cannot use it as an excuse. While he may not know the process, in such a case, he should be the one reaching out to the CEO and seeking his help on the matter.

Secondly, as suggested by your HR, did you ask the CEO when the pay would be released? Ask them to provide this information in writing on the company's letterhead.

Ideally, on your relieving letter, they should have mentioned how long the processing of your Full and Final (F&F) settlement will take and when you would receive the cheque. Writing on the company's letterhead ensures that they are liable to pay you the said amount, giving assurance to the employee that his money is safe and he shall receive the paycheque in a few days.

I would suggest you write an email to both HR and the CEO individually, asking when you shall be paid your F&F and to provide the same information in writing.

Hope this helps...

Regards

Thank you so much for your help. My head office is in Gurgaon, and it's not possible for me to meet the CEO face-to-face. I had gone there twice, and he purposely did not come. When he came, he simply asked me to bring an advance from the schools I was servicing. I have been writing to my boss while keeping the CEO and HR in cc, stating that the school will not pay an advance as they have not seen or met the person who will be going in my place. Secondly, the schools gave me advance payments earlier, as I had a good rapport with them. They are just harassing us (me and some more employees). We have not been given any relieving letter. I had sent my resignation cum one-month notice through email but did not get any confirmation of acceptance from them. I have also submitted their assets in good condition. Please suggest.

Payment of Wages Act Compliance

As per the Payment of Wages Act, payment of wages must be done within 2 days of termination of employment. The rest of the amounts for full and final settlement must be completed within 30 days of the termination of employment. There is no provision allowing for the holding back of wages for any reason. In fact, failure to pay wages (wages include salary) by the 7th of the next month constitutes non-compliance, for which a penalty of up to Rs. 7500 per incident can be imposed.

However, the payment of wages does not apply where wages exceed Rs. 18,000 per month (which is likely the case for BPO pay). It is important to read the act and show the relevant rules to the HR. Most likely, they will not be aware of the salary limit and will process your payment quickly. You can file a complaint with the labor office, but I doubt if the action will be taken in time for you.

Regards.

Hi, I need your help. Can anyone provide a memo template for holding salary for resigning employees? I would appreciate your assistance.