Is My Appointment Letter's No-Pay Leave and No PF Policy Legal? How Can I Challenge It?

Appointment Letter Concerns in Pvt Ltd Company

I joined a Pvt Ltd company six months ago. In the offer letter, they did not mention anything about terms and conditions; some conditions were communicated verbally. Now, they have given me an appointment letter. They deduct salary immediately if you take any leave, i.e., on a no work, no pay basis. However, in the appointment letter, they mention that the notice period is 3 months. There is no PF deduction in my salary.

Validity of Appointment Letter Terms

Kindly let me know whether an appointment letter of this kind is valid, where they deduct money for each leave and there is no PF. They asked me if I leave the job, I have to pay 3 months' full salary. If this is illegal, then where can I challenge it?

Notice Period and Leave Policies

The clause of a 3-month notice period is valid, and the notice period clause varies from 1 month to 6 months depending on the designation of the person. Also, the leaves are usually credited to the person from the date of confirmation or on completion of the year. Therefore, if you have taken any leaves, they would be LWP (Leave Without Pay).

Nothing is illegal in any of the queries that you have mentioned above. Also, normally, the offer letter does not include the terms and conditions. It is the appointment letter that includes them.

Regards,

Dear Babunath, I find three issues in your post: deduction of wages for leave, a three-month notice period, and not having a PF facility. Each is independent of the other. All three things are not generally reflected in the appointment letter.

Employee Leave

We do not know whether your company is registered under the Factories Act or the Shops and Establishment Act. Therefore, we need to check the provisions about employee leave mentioned in either act of your state. Nevertheless, as per the guidelines of other states, it can be said that roughly you are eligible for a day's leave for every month of your employment in the first year. Zero leave is against the law. Each company is expected to provide a leave card to its employees, and every month addition or deduction should be recorded in this book. Few companies do this in the monthly salary slip itself. If you are aggrieved on account of wage deduction for leave, then you may make a complaint to the labor office.

Notice Period

Your second point is about the notice period of three months. It is the employer's choice on how to design the terms and conditions of employment. Yes, these should have been communicated well before recruitment, but hardly any company will talk about the separation from the organization right at the recruitment stage itself. Many companies have this clause. Therefore, your company is no different.

PF Facility

Lastly, about not providing the PF facility. How many employees are working in your company? If it is more than 10, then you are eligible for PF. You may make a complaint in the PF office for not providing the PF facility.

Notwithstanding the shortcomings in your organization, the question arises, should you accept these unfavorable conditions or make a formal complaint to the respective legal authority? Nevertheless, the question arises, do you need employment? You may take on your employer, but then incensed at the complaint, they will try to remove you for some other reason. Therefore, take the call of the complaint judiciously. Continue 1-2 years in this company, look for better employment, and quit!

Thanks,
Dinesh Divekar