Struggling with Unpaid Salaries and Final Settlement: How Can I Get My Dues from My Former Employer?

Hi, I joined a software company last year for its branch office in another state, which is headquartered in Bangalore and had approximately 190 employees. One month after joining, a problem with delayed salary payments began. Initially, there were verbal assurances that the company was expecting funds. However, this progressed from partial payments to delays of 15 days, 1 month, 2 months, 3 months, 4 months, 5 months, and so on, making it unbearable for me, leading to my resignation. Despite my regular follow-ups with HR and top management, the company has not provided me with the full and final settlement details. They keep mentioning that the funds are not available currently and will clear the dues once the funds arrive. Unfortunately, they are not responsive to my calls or emails, nor are they providing any specific timeline. Additionally, they have not issued Form-16 for the last financial year to anyone or reimbursed expenses despite repeated requests. Nearly 60% of the employees have resigned.

It has been over 2.5 months since I resigned, and I am still struggling to find a suitable job. I am facing significant difficulties. Please advise me on how to obtain my full and final dues and Form-16 from this company.

Thank you and regards.

There is no use hanging around a company that does not have sufficient funds to pay its staff salaries. Since you have already received the relieving letter, it would be better to shift elsewhere. If you are concerned about your unpaid dues, please continue corresponding with them via speed post or other means to establish your point of view once you take it up with them under the Payment of Wages Act.

Regards,
S.K. Johri

It is difficult to leave because the hard-earned money (5 months' salary) is not small. Also, they have not given Form-16 and paid for reimbursement expenses. There must be some way out like writing/emailing the Labour Commissioner initially before looking for civil proceedings.

Regards,

Approach the Deputy Commissioner of Labour

Approach the Deputy Commissioner of Labour of the Labour Department of the state government. Irrespective of your salary limit, you can file a complaint against the so-called company with a full communicative address and the appropriate person's name to call for a joint meeting to solve your problem.

Legal Action Against the Employer

Lastly, I suggest you please remember you can approach the court of law, i.e., the public court, and file a case against the corrupted employer. All private employees should know that the payment of salary is the responsibility of the employer, and receiving salary for the worked period is a right given by the Constitution of India. There is no salary limit. Issue a lawyer's notice and file a case before the company's jurisdiction court under the Minimum Wages Act 1948.

How can I obtain Form-16/TDS for FY 2013-14 & 2014-15 in order to file my IT return? What about the PF money? I have heard that they have not yet deposited both.

Additionally, I have heard that this company was officially closed on paper 1-2 months ago. A new company has been formed with a different name, and some employees have received a relieving letter from the old company and a joining letter from the new company, both backdated.

Is it feasible for a company to shut down without settling its liabilities?

Best Regards.

Steps to Take Before Legal Action

First, you need to take a printout of all the emails you have sent to the company and their feedback as well. All these documents will support you when submitting evidence. Before proceeding legally, you can send a final email to the company that should include all the details, such as your resignation date and the fact that you have not received your salary for the last five months. They have also ignored your previous inquiries.

Finally, you must add, "I regret to inform you that I am taking legal action against the current situation with the labor office. I hope to receive an immediate response from the company. Good luck." Is this a start-up company?

Thank you very much, Asha. Can you please provide me with the email ID of the concerned Labour Commissioner? The headquarters of my employer are located in Malleshwaram, Bangalore. This company is not a startup but a 14-year-old company.

Steps to Address TDS and Form 16 Issues

Please check your Form 26AS statement. If the company has deposited the TDS against your salary, then it will reflect in Form 26AS. That is adequate proof for the tax authorities. In any case, you can complain to the IT Department regarding non-receipt of Form 16.

However, if Form 26AS does not reflect the TDS, then obtaining Form 16 is also meaningless. I believe that under the law, you are still liable for the taxes. In that case, you should immediately visit and meet the Public Relations Officer (PRO) at the nearest Income Tax Office and seek their assistance. They will issue the required notices, but you must have all the necessary particulars and proof of your employment and salary receipts.

If you are unsure about Form 26AS, seek assistance from your Chartered Accountant (CA). They will help you create the account and download the statement.

Company Closure and Employee Rights

It takes 18-24 months to close a company. So, probably, they formed a new company, asked the employees to resign and join the new one, and transferred the business to it. The company still exists. You can complain to ROC/MCA and inform them that they owe you money. Then, they can't close it without clearing dues or going through the bankruptcy proceedings.

There is also a legal doctrine called "Piercing the Corporate Veil" which applies in this case. This amounts to fraud, and the limited liability clause will not protect the company from previous liability. However, you need a good lawyer to help you if it needs to be established.