Navigating the Bombay Shops & Establishment Act: Are Salary Slips a Must for IT Companies?

Respected Seniors, I am Bhavya, working in a growing IT company, and we come under the Bombay Shops & Establishment Act. So my questions are:

1) Is it compulsory to provide salary slips to employees as per the Bombay Shops & Establishment Act?

2) We are maintaining a salary register and taking each employee's signature on it, so is it necessary to provide salary slips? Our company's mode of salary payment is through Net banking.

Regards,
Bhavya Chawda

It is very common for many firms not to provide salary slips to employees in general, except when they are asked for. Please remember that if an employee requests the salary slip, it shouldn't be neglected. The salary register you maintain may act as proof of cash outflow and to whom all salaries are paid for the company's purpose.

However, as an employee, I too should have some proof to be able to state that I draw X amount from this company month on month. If I am seeking a change, I need salary slips to show to my prospective employers to prove that my salary is indeed X and not an inflated amount. It becomes very easy when filing taxes and seeking advice from CAs.

By the way, why do you not wish to provide the salary slips? It doesn't cost much anyway. Even a print on simple paper with the company's stamp on it should suffice.

Dear Ankita, actually, about 1.5 years ago, one of our employees left the organization. At that time, our number of employees was too low, so we did not provide salary slips to anyone. Additionally, there was no HR personnel available at that time. The employee in question left by simply submitting a resignation letter without completing the notice period. Now, they are requesting a salary slip. We would like to ascertain whether, as per the Bombay Shops and Establishment Act, it is necessary to provide salary slips.

Wage Slip Requirements Under Different Acts

Wage slips are required to be issued a day prior to the disbursement of wages to the employees covered under the Minimum Wages Act, 1948, and the rules made thereunder. The Bombay Shops and Commercial Establishment Act, 1948, does not have any provision that directs us to issue wage slips to the employees.

Regards,
R.N. Khola
Welcome Skylark Associates

Even though the Bombay Shops and Establishments Act does not instruct an employer to provide payslips to its employees, he needs to comply with the Minimum Wages Act 1948 and the Maharashtra Minimum Wage Rules thereunder. Rule 27 of the Maharashtra Rules requires an employer to maintain a muster roll-cum-wages register wherein he has to record the details of gross salary along with deductions and provide an extract of entries in the muster roll-cum-wages register to each employee so that he can use it as a wage slip. The object of providing such an extract is to put the employee on notice about his attendance and details of wages.

The employee also needs to know certain calculations like overtime to ensure that they are correctly calculated. Overtime is calculated based on basic wages and other allowances. An employee will be in a position to verify the correctness of the calculation only when he knows his salary components.

Thirdly, a payslip needs to be provided as per the requirements of the principles of natural justice and principles of fair labor practices, which require that nothing that affects an employee shall happen behind his back.

Hope this helps to understand why it is advisable to provide a payslip to an employee.

Regards,
B. Saikumar

Respected Seniors,

I am Bhavya, working in a growing IT company that falls under the Bombay Shops & Establishment Act. So, my questions are:

1. Is it compulsory to provide salary slips to employees as per the Bombay Shops & Establishment Act?

2. We are maintaining a salary register and have each employee sign it, so is it necessary to provide salary slips? Our company's mode of salary payment is through Net banking.

Actually, in the past, about 1.5 years ago, one of our employees left the organization. At that time, we had very few employees, so we did not provide salary slips to anyone, and there was no HR available at that time. The employee left by simply giving a resignation without completing the notice period. Now, they are asking for a salary slip. We want to know if, as per the Bombay Shops and Establishment Act, it is necessary to provide salary slips.

Please reply now.

Regards,
Bhavya

Actually, in the past, about 1.5 years ago, one of our employees left the organization. At that time, our number of employees was too low, so we did not provide salary slips to anyone. There was no HR available at that time. The employee stopped coming by simply giving resignation without completing the notice period. Now, he is asking for a salary slip. We would like to know if, as per the Bombay Shops and Establishment Act, it is necessary to provide salary slips. Please reply now.

Dear Bhavya,

Why are you reposting your query? It's just a duplicate of what you've already posted. Kindly do not keep adding your posts. People will read and reply. In fact, I think there are enough replies for you to make up your mind.

It is fine that you didn't have HR practices in the past. That doesn't mean you can never start. Also, as I said, if an employee asks you for a salary slip, it should be your duty to provide him/her with one.

What is it that you're looking for? Are you looking for someone to come here and say it's not compulsory to give the slips?

Please don't repeat the post and add to the conversation.

Regards

Let me understand this clearly. You have an employee who resigned, took his settlement, and left 18 months ago. Now he has come back asking for his salary slip. Do you know whether he was actually working, what his salary was, and how much he was paid? Do you know for sure that no payslip was issued to him then, or a salary certificate in place if a payslip was not provided?

You are under no obligation to give a salary slip to someone who has already left, except as a part of his settlement. So, you are free to refuse. Check with the owners what they wish to do. However, there is no harm in actually giving a payslip copy to someone who worked there before, provided you are sure what he is asking you to give is the correct payslip (correct rate, number of days worked, etc.) and that you are not being taken for a ride.

Salary Slip Requirement

A salary slip or payslip is mandatory. It must be issued either as a hard copy (printout) or a soft copy (email/PDF).

But is it mandatory to give it now to someone who left 18 months ago? The query is not about current employees. It is about someone who left 1.5 years ago. I think it is not mandatory to give it to him now, though out of goodwill, the company may choose to give it. He should have asked for it then. Also, a payslip issued now (without proper records as the HR was not there) is subject to misuse.

I am with Saswatabanerjee. Did you check with the ex-employee the reason(s) for his approaching your company for a salary slip now? If yes, what did he say? If no, I suggest checking regarding this aspect. You haven't mentioned if his F&F formalities were done and if he got his relieving and experience letters after he resigned and left. If the guy has come all the way after 18 months, obviously there's something fishy, especially since he left without fulfilling any notice period formalities. Any new employer would insist on the past 3/6 months' salary slips during the interviews. One can understand if he had come for his relieving and experience letters if they weren't collected at that time. If you aren't convinced with the reason(s) the guy gives, you can very well refuse.

Regards,
TS

No salary slip can be provided at this moment after a long gap. This can be done only during the service of an employee. If you still want to help him, you can provide him with a certificate indicating his last drawn gross and net salary. It does not require a break-up or mentioning all components of the salary—only gross and net.