Facing Salary Delays Due to Demonetization: What Legal Steps Can We Take?

Dear All,

Our company has not been paying salaries for the past 2.5 months. The reason cited is due to demonetization. What legal steps can be taken?

Thank you.

This is no valid reason to stop wages. Contact your area labour inspector and lodge a complaint. He will take care of the rest.

Also, if you are paying PF and ESI contributions, contact enforcement officers and file a complaint there as well.

Depending on the nature of your employment as well as the nature of the company, you can demand salary in writing, keeping an acknowledgment, and then contact the office of the labor commissioner as advised above.

Debilitation cannot be a reason to withhold salary/wages.

The dues towards payable wages must be paid off within seven days of the following month, failing which prosecution under the Payment of Wages Act can be initiated against the Occupier and Manager of the factory.

You are required to submit your complaint to the management and endorse a copy of the non-payment to your area Inspector or Officer who will investigate the matter.

P.K. Sharma

There is a recent circular from the Factories Inspectorate stating that wage payments must be credited to the respective bank accounts of employees. Therefore, you should request your employer to credit the wages due to your bank account. Start by submitting a written request to your employer. If your employer does not respond, you can escalate the matter to the labor department.

Regards

Dear Concerned,

Please approach your employer or HR manager first and submit a request letter to release your due wages. Wait for a week, and if there is no progress, then approach your concerned labor office with all your proof of employment, etc. File an application for the recovery of your wages. This is only my personal opinion.

As rightly mentioned by Mr. M V Kannan, please check whether your employer credits your salary to your bank account. If not, please proceed with the Labour Inspector.

Irrespective of your designation, if you perform duties that are not managerial or supervisory in nature, then you may be eligible under the workman category as per section 2(s) of the Industrial Disputes Act, 1947. You can approach labor authorities regarding non-payment of your wages/salary. However, if your monthly salary is ₹18,000 or less as per section 1(6) of the Payment of Wages Act, 1936, your employer cannot set your wages to exceed one month as per section 4, and as per section 5 of the same act. If the employee count is below 1,000, the salary must be disbursed within the 7th day after the closing month. If the count exceeds 1,000, the salary must be disbursed within the 10th day after the closing month. Try to resolve this issue amicably; otherwise, approach your regional labor commissioner for violations of the Payment of Wages Act, 1936. If you find no relief there, you can even file a case under section 33C(2) of the Industrial Disputes Act, 1947, for the recovery of dues.

Thanks & Regards,
V. SHAKYA
HR & Labor, Corporate Laws Advisor