Is It Fair for My Final Settlement to Be Delayed Due to Accounting Issues After Clearance?

Sir, I resigned from my position on 27.06.2016, and the company issued a clearance certificate on 04.07.2016. However, to date, the company has not cleared my full final settlement. Now, the company claims that there are some issues with the accounting bills. My question is, if the company provides a clearance certificate signed by all departments and finally by the HR head, is there any HR rule stating that the full and final settlement can be put on hold even after clearance from the company?

See generally under the Shops and Establishment Act of your state, read along with the Payment of Wages Act. After termination, the settlement has to be made on the 2nd working day from termination. So, go directly to your area labor inspector and file a complaint. Refer to the website mentioned in the footer for details.

Have you asked HR how long it will take to clear the accounting problems? Make sure you raise your query in writing as well. The general rule is 2 days. Such a long delay does not seem justified. But it's better to talk to the company, take the help of your former boss, and settle amicably.

Dear Sir,

Thank you for providing valuable tips. The latest email from the HR Head states:

"Issuing a clearance certificate and making payment of dues after checking the record are two different things. Once again, we advise you to come to the plant and clear any objections; failing which, your settlement will be further delayed."

Could you please confirm if there is any validity to this statement according to HR theory?

Thank you.

Addressing Clearance Certificate Issues

I don't see why you have a problem with just going to them, sitting, and clearing whatever doubts you have. It solves the problem from both ends and ensures the matter is amicably settled.

From an academic point of view, it depends on what exactly your clearance certificate says. Is it a no-dues certificate? And is it also obtained from accounts, who seem to have raised the query now? If it's not a no-dues certificate and if the certificates are not also given by accounts, then HR is right in saying this needs to be cleared.

It is a "No Dues" certificate, certified by all departments, and finally signed by the HR head.

Thank you.

Well, then technically, you are right, and the company is wrong. But in reality, what difference does it make? (That is why in my post I said, "From an academic point of view.") The company is not paying you; they are asking for you to come and give a clarification. Any other action you take only increases the cost and jeopardizes your chances of getting the money faster.

Incidentally, can you post a copy of the No-Dues Certificate? I would like to see its wording.

Addressing HR and Accounting Discrepancies

Your certificate clearly states, even from accounts, that no money is due from you. This should and would be given only after thorough checking. Therefore, your HR's stance and statement are not only incorrect but also unreasonable. If someone in accounts issued a no-dues statement without proper verification, it is the company's fault, and you cannot be held responsible.

Options Before You

- Approach the labor commissioner to see if you can get assistance.
- Speak to a senior member of management and point out how you are being harassed.
- Send a legal notice to the company (this often helps).
- Consider taking the matter to court (though this is very expensive and time-consuming).

Regards,
[Username]

There is a pretty good amount due to you, such as leave encashment, OT amount, and some unpaid salary, etc., payable to you. Please meet with the HR person responsible for FnF and strategically work out the details with them, involving your HOD as you would with any other person upon their exit. It appears simple, and you can resolve the situation without treating it as just another case. These individuals are primarily here to support you on paper and are available to address any such situations, especially when someone is departing.

Best wishes,

Regards, RDS Yadav
Director,
Future Institute of Engineering and Management Technology,
and
Labour Law Adviser
[Email Removed For Privacy Reasons]