How Can I Secure My Unpaid Salary Benefits When My Employer Won't Honor Their Commitment?

Dear friends, I am seeking your advice. I have been working with a company for the past year and am now planning to leave, tendering a notice period of approximately one month out of the three months required (as stated in the appointment letter, this applies only to employees, not the employer). I am facing a significant issue in obtaining all the dues committed by the employer, such as the performance variable pay for a year, which constitutes a large portion of my total salary. At the time of the offer and appointment, the employer committed to providing these benefits on a monthly and quarterly basis, but to date, they have failed to fulfill this promise. Additionally, there is a deduction of a monthly bonus from my pay structure, which was also promised to be given at the year-end.

However, they now refuse to pay and have responded that if I remain with the company, they will pay all dues. How can I trust them to pay these amounts when, over the past year, they have not paid a single penny to any employee?

Furthermore, I have learned of a few cases where they paid all the benefits to some employees who left the organization at a senior level or to those they terminated without serving a notice period.

I have all the proof, such as the Appointment Letter, where these commitments are clearly mentioned in my pay structure with the company's seal and the authorized signatory's signature in original.

Please suggest how I can obtain these dues from the employer, or should I consider filing a labor complaint to receive these benefits?

Thanking you

Understanding Your Rights to Salary and Promised Benefits

Salary is your fundamental right as per Article 300 of the Constitution. Any promise made in the advertisement or appointment order has to be fulfilled. There cannot be any precondition to it.

I am providing you with a few quotes from the courts that may be useful to you.

The Supreme Court in the case of M.D., T. Nadu Magnesite Ltd. Vs. S. Manickam and Ors. (LegalCrystal Citation: legalcrystal.com/842317 Reported in: JT2010(3)SC328) held:

"The doctrine of promissory estoppel or equitable estoppel is well established in the administrative law of the country. To put it simply, the doctrine represents a principle evolved by equity to avoid injustice. The basis of the doctrine is that where any party has by his word or conduct made to the other party an unequivocal promise or representation by word or conduct, which is intended to create legal relations or effect a legal relationship to arise in the future, knowing as well as intending that the representation, assurance, or the promise would be acted upon by the other party to whom it has been made and has in fact been so acted upon by the other party, the promise, assurance, or representation should be binding on the party making it and that party should not be permitted to go back upon it, if it would be inequitable to allow him to do so, having regard to the dealings which have taken place or are intended to take place between the parties."

The above case proves that a promise made in the appointment order cannot be violated, which is detrimental to one party.

The Monopolies and Restrictive Trade Practices Commission Director-General Of... vs Sahara India Saving And... on 6 September 1989 (Equivalent citations: 1990 68 CompCas 153 NULL, Bench: G Luthra, H Gupta) and the Supreme Court in Lakhanpal National Ltd. v. MRTPC [1989] 66 Comp Cas 519 made the following observations regarding unfair trade practices:

"Does it lead a reasonable person in the position of a buyer to a wrong conclusion?... It is, therefore, necessary to examine whether the representation complained of contains an element of misleading the buyer. Does a reasonable man on reading the advertisement form a belief different from what the truth is?" (emphasis supplied)

When a CTC was promised, it is a simple expectation that on joining, one will get the CTC advertised. The CTC is the cost to the company which must be incurred by the company as it is an irrevocable promise made. No reason can be invented to avoid the cost.

The Punjab-Haryana High Court in Punjab State Civil Supplies... vs Pyare Lal on 9 November 2012 (Letters Patent Appeal No.113 of 2012 http://indiankanoon.org/doc/161767981/ by a 3-judge bench - in para 10) has held:

"The salary is a property given to the hands of the State which cannot be withheld except under the powers derived by a statute or law as contemplated under Article 300A of the Constitution of India as laid down by the Supreme Court in MANU/SC/0046/1988: AIR1988SC1407 [State of U.P. v. Haji Ismail Noor] and MANU/SC/0325/2003: [2003]3SCR779 [K.S.R.T.C. v. K.O. Varghese]."

The above case makes it clear that the salary promised cannot be denied as it is the property of the employee.

Regards

Understanding CTC and Variable Pay

I think you are confusing the concept of CTC with your gross salary. The concept of variable pay also varies from company to company, so it would be better if you shared your appointment letter so people know the exact clause.

Mostly, variable pay is at the discretion of the employer. So you don't get it if the company decides it does not want to give it to you (again, the exact wording of your appointment letter will make a difference).

Bonus is not being deducted from your salary; it's a part of your CTC. Again, I guess unless your salary is less than Rs. 21,000 per month, the bonus is at the option of the company.