Left Your Job Before Arrears Were Declared? Here's How to Tackle This Dilemma

Dear Sir/Madam,

I joined my company on 1-6-2012, resigned from my job on 1-4-2016, and after one month, in May 2016, the company declared arrears for the period of 2012 to 2016. When I asked my manager about my arrears as I was an employee of the company at that time, he replied that since I had left the job, they were not obligated to provide any arrears as I had stated in my resignation that all payments were settled. What should I do now?

Thank you.

It is not "arrears" but you are due to get "allowances." Secondly, you have mentioned the period of employment, but what about the period of allowances? What was the cause of these allowances? Has anything been mentioned in your appointment letter regarding payment of the allowances? When did you claim these allowances? While submitting your claim, did you route these through your Manager? What proof do you have to show that you were eligible for the allowances or that you have submitted these allowances to the HR/Accounts Department?

Has the company given you the Employment-cum-Service Certificate? Have you taken up a job in the new company? I ask these questions because when dealing with your old employer, it should not affect your current employment. Keep your current HR informed about the issues you are facing with the past employer.

Payment of Arrears

When the company underpays an employee, the subsequent monthly payment that includes the unpaid portion of the salary is called arrears. However, the question arises, why were arrears pending for four years? Did you approach HR about the unpaid arrears? If yes, do you have proof? If there was underpayment, you are entitled to your dues. Leaving employment should not be a reason for non-payment. Regarding the clearance of dues declaration, it can be obtained even under duress.

If you believe that the dispute with the old employer will not impact your current employment, you may approach the Labour Officer (LO) in your area and explain your problem. Keep evidence of your past employment like the appointment letter, salary slips, photocopy of the identity card, etc. with you. Let's see to what extent he is willing to intervene. If he is not inclined to intervene, we will decide on the next steps. Inform him that you were compelled to provide a certificate stating that no dues are outstanding against the company.

Thanks,

Dinesh Divekar

Dear Chetangor,

I understand you are referring to salary arrears. Please send a letter to the HR department asking for these arrears with a copy to the HR head so that they would respond and tell you when they are paying or the reasons why it is not payable, etc.

I was a graphic designer at a newspaper. My company has revised the salary of its employees due to a mistake in the calculation of the newly designed wage board, namely the Magethia wage board for journalists and non-journalist staff in the newspaper industry. I was an employee during the period for which the salary was revised. I have not yet claimed the revised amount as my employer has not officially declared it as salary arrears. However, from the payslips of current employees, I can see an increase in the basic salary. My employer verbally refused to provide me with the salary arrears. Therefore, I seek some advice. This post is for clarification of my earlier post.

Thank you.

Understanding Arrears and Eligibility

Generally, arrears are given for:

1. Underpayment (Less than the Minimum Wages)
2. Settlement with the Trade Union
3. Settlement through the Internal Union

In your case, it is not clear from your statement what type of arrears were given by your ex-employer.

Normally, organizations revise salaries during the Performance Appraisal or when they make a significant profit (this is called an interim revision). Companies prefer to give raises prospectively rather than retrospectively, except for government organizations or through settlement with the union. Even if it is a settlement or an award, the company usually includes a clause stating that the settlement/award is applicable to employees on roll or in service at the time of signing the agreement/settlement.

Please check with your colleagues who are still employed with your previous employer to find out what type of arrears are paid to employees and the terms. Your management must have displayed a notice for the payment of such arrears. If you can obtain a copy of the said notice, please read the terms of payment and the eligibility of employees for arrears. No law will make you eligible for arrears if it is not written in your contract of employment, and if you are not underpaid, as you had accepted the terms and conditions of appointment at the time of joining. Fair wages can be given to current employees along with arrears for retention.

Best Regards,

I believe that the so-called revision in salary has been made effective for employees who continue to be on the company's payroll as of the date of the agreement. You need to consult with your former colleagues to confirm that, like you, those who are no longer with the company know the actual and correct position. If, as per the terms of your appointment letter and in subsequent years, you received payments without any legal deviations, you are not entitled to arrears. Please check the information posted by management on the notice board, including its contents and who has been paid.

In the case of wage settlements with unions, it is typically intended that only workers who are on the payroll as of the settlement date should benefit from such payouts, not employees who left in the past. The reason is clear: employees on the current payroll will continue to contribute to meeting management's demands for productivity norms, and so on. Long-term agreements (LTAs) are signed between employers and unions primarily with the main aim of achieving higher and higher productivity and ensuring long-term peace by distributing earned money proportionally. In fact, more details and facts like these are needed to address the issue of "non-payment of arrears" raised in this post.

The above is just my assumption, an attempt to bring clarity and value addition to a general situation similar to others and yours.

Regards, RDS Yadav
Labour Law Adviser and Director, Future Instt. of Engineering and Management Technology

Entitlement to Arrears

Your entitlement to arrears will depend on the terms and conditions of the wage revision done by the Wage Board. If the arrears are payable to all employees on the rolls of the company on the effective date of revision, then you will also be entitled to it. If the revised wages are applicable only to serving employees but not those who left the establishment, then you may not be entitled. Please verify this aspect with your ex-colleagues.

In the meantime, you can send a letter seeking payment of arrears and await their written reply for better clarification.

Regards,
B. Saikumar
HR & Labour Relations Advisor

You are entitled to receive the difference in salary for the period you have worked. If they deny it, it is illegal. You may first approach them by mentioning that you are entitled to the arrears for the period you worked. If they deny, you may approach the labor office of your area.