Is It Legal for Our Company to Withhold Salaries and Terminate Us Without Reason?

rock1wwf
Dear Sir, Please bear with this long mail, but it will clear many doubts in the minds of the employees.

We are all employees of a European MNC based in Gurgaon. We joined this company on terms such as high growth start-up, high standards of working, high quality of product, and many more which could be enough to lure any prospective employee. We left our already settled work-life to join this team, which had the so-called high moral standards.

We are a team of 8 sales personnel working across 2 states in India. Lately, 5 of the 8 have resigned owing to unjustified qualms and reasons which stir the respect of each employee. At the end of the day, we also work for self-respect, of which the top management has made utmost fun most of the time.

Some of us have not been paid reimbursements (travel allowance and incidentals) for as long as 5 months, others for a minimum of 2 months. We have never asked the accounts team for reimbursements as we feel they would be taken care of automatically once we submit them. But, it is of low importance to the accounts team for a long time. We still have not received our salary for December; January is a far-sighted goal.

Finally, after a long time, the sales team asked for the same, as a result of which our National Head decided to terminate 3 of the 6 employees who demanded the same. New guards were employed with strict instructions to not let any member of the sales team, including female employees, enter the office premises.

The ones who have been terminated are not given justified reasons. For example, a management trainee has been terminated, for which a Senior Manager said, “You were a trainee, and your training is complete.” It remains a mystery as to what the training was provided for if they did not want to continue with the confirmation. The appointment letter states that if the training was not up to the mark, then it can be extended, towards which they do not have an answer.

One employee who had been directly recruited on the direct reference of the Sales Head has not been terminated.

Clarifications Needed

I request you to please clarify the following:

1) Can a company prohibit its employees from entering the office by using power?

2) Is the employer required to give the reason for termination for employees on probation period?

3) Can we resort to legal action against the company for not paying our reimbursements/salaries on time and terminating employees without any valid reason and playing with everyone's career?

Thanks & Regards

Sales Team
sushilkluthra@gmail.com
Impact of Demoralizing Culture in MNCs

If an MNC is exhibiting a demoralizing culture towards its employees, it may negatively impact its image worldwide with electrifying speed, more so than an ordinary company.

Legal Recourse for Non-Payment of Salaries

With regard to query no. 3, certainly, you can take action against the employer for non-payment of salaries in time. Since the employer is covered under the Payment of Wages Act, if the employee is earning less than Rs. 18,000 per month, they can seek recourse through this Act to recover salaries by making a complaint to the inspector and other authorities under the Act. Additionally, the employer seems to be covered under the Punjab Shops and Establishment Act as extended to Haryana, and section 16 thereof states that wages are payable before the 7th of the month. An inspector under the Act can also be approached for non-payment of wages. Termination of employees can be done after giving the notice period of one month or wages in lieu thereof as specified under the Act, provided the employee has been under continuous service for three months.

Termination During Probation Period

As regards query no. 2, no reason is required to be given while terminating during the probation period.

Employer's Discretion on Employee Entry

As regards query no. 1, it is the discretion of the employer to restrict the entry of any category of employee in its office.

Thanks

Regards,
Sushil
NK SUNDARAM
In fact, if rules permit, you can make public the name of the MNC so that there are no new victims. You will be doing a great service to the public and drawing the attention of the media. Many people assume that an MNC means it is a great place to work, and there will be a great culture to be happy working in. Unfortunately, there are many companies that have set up shop in India only to use the cheap labor force to amass their income through dubious means and repatriate funds to their motherland. Using their monetary clout, they 'buy' government authorities so that they can defy the statutory laws that need to be followed. You know how our government officials are, who easily succumb to money. Perhaps this is an eye-opener for many who fall prey to the craze of the so-called MNCs! Please take the legal recourse and quickly file a case of criminal breach of trust under section 420.

Best wishes
Ddoaba
Explanation of Provisions by Mr. Sushil K. Luthra

It is one of the duties of an Inspector appointed under the Punjab Shops and Commercial Establishments Act to ensure that full and final (FnF) dues and documents are supplied on time. The maximum timeline for this is the last day in the office, which is usually the payday.

Employee Rights and Employer Obligations

No one can prohibit or prevent an employee from entering the office to discharge their duty. If the employer desires the employee to remain at home, written communication expressing this should be provided. In the absence of such communication, the employee can lodge a complaint with the police, the Office of the Labor Commissioner, officials in the Department of Labor, Employees' or Trade Unions, or a court of law.

Recent Penalty Case in Karnataka

Recently, the Department of Labor in Karnataka levied a heavy penalty of Rs. 12 lakhs on an MNC for terminating a female techie.

Legal Actions for Unpaid Dues

If the employer has not paid due reimbursements or wages, a complaint under section 406 or 420 can be lodged, and even a winding-up petition can be filed.

Steps for Employees Facing Unjust Termination

Employees should approach a competent Labor Law Consultant or service matters lawyer and demand salary slips for all months, PF number with account slips, ESIC card, acknowledgment of reimbursement claims, payment of all dues, and to call back the termination order. They should also request an explanation for the reason for termination and demand disciplinary action against employees who stopped entry by force.

Employer's Record-Keeping Obligations

The employer has to maintain various registers/forms pertaining to attendance, overtime, work hours, payment of wages, disciplinary action, etc., under the Punjab Shops and Commercial Establishments Rules. These can be obtained through an Inspector and can even be pursued through RTI.

Support from Trade Unions

The trade unions have been strong in Haryana and are always willing to support the employees.

Regards
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