Unfair Job Termination: How to Handle a Company Demanding Compensation for Incomplete Work?

Hi all, my wife started working with this company 2.5 months ago as an Android developer. She was assigned to work on an app that was half-baked by the previous senior developer (TL), who then left the company without completing the app. She began developing it and was the only person working on it without a senior developer to assist her. The task was beyond her skill set to complete the app within the defined timeframe, especially as it was a complex project for a developer with only 1 year of experience. Despite giving her best effort to complete the app, the deadline was extended by 3 weeks. Additionally, she had applied for a 5-day leave in the 4th week, for which she had informed a week prior.

Just a day before her leave, she received a message from the CEO in the company's WhatsApp group stating that she was relieved from her job due to not completing the app within the extended timeline. Following this, there was no further communication from the company regarding final formalities such as Full and Final Settlement (FNF) and paperwork. When we reached out after the payday had passed and did not receive any response from the CEO, who seemed to be avoiding the situation, we sent an email inquiring about the FNF, which included 1.5 months' worth of salary. In response, the CEO mentioned that the company incurred a loss of "X" amount due to the incomplete app, and they would only process the FNF and paperwork if she compensated for the losses.

It was never communicated to her that she would be required to compensate for any losses if the app was not completed, making this demand unjust on the company's part. Holding her salary, for which she had diligently worked, in exchange for compensation is highly unfair.

Kindly advise on the best course of action in this situation, as this approach by the company is not only unethical but also puts the employee in a difficult position.

Hi Shivam,

This is absurd, as an employee cannot bear the expense for a so-called loss in any abstract manner. You can speak with an advocate who deals with corporate affairs, and after receiving his advice, you can approach the labor commission/inspector. Do you have the email that was sent by the CEO, stating that your wife has to pay for the loss?

Hi Mahr, thanks for responding. Yes, I do have that email from the CEO. I was thinking of responding to him on the same email, putting the facts in the email and making him realize that he is the one responsible, not my wife, for any losses or delays in the app.

Had you mentioned the last-drawn salary of your wife, the inputs would have been more complete. Anyway, your wife was a "workman" eligible to seek a remedy under the Labour Laws. Since your post conveys only the desire for getting the unpaid salary for the period she worked and nothing more, your wife may file a claim under Section 15 of the Payment of Wages Act, 1936 before the Authority under the Act (normally it would be the Deputy Labour Commissioner) if her monthly salary was not above Rs. 18,000. Otherwise, she can file a claim under Section 33C(1) of the Industrial Disputes Act, 1947 to the Appropriate Government, and they will issue a certificate to the concerned District Collector to effect recovery under the RR Act.

I would like to add to what is already mentioned. Section 33C of the Industrial Disputes Act, 1947, is an executive proceeding. It was created to avoid delays in the legal process when the dues are clear, as in your case, and the employer has failed to pay them. This will provide you with the quickest remedy, even if the employer disputes the payment.

Firstly, the termination is illegal. Secondly, your employer cannot claim any amount from your wife in the manner as mentioned above.

Since your wife has worked for only 2.5 months, the amount of full and final settlement won't be much. However, you can always claim the same by way of sending notice and then filing a case before the appropriate court. It is better to consult a lawyer with all your documents first.

Her salary was $20,000. Thank you for your inputs, but before proceeding, I would like to be 110% sure that she is not legally liable to pay for any compensation, even if they prove her guilty by using any underhanded tactics. Please assist me with this.

Hi Ritesh,

The offer letter is the only document we have, and it doesn't have any clause stating that the company can hold the salary in any manner.

Thank you.