suspended employee any chance to get remaining subsistence allowance after the completion of inquiry

Hi, please tell me if a suspended employee has any chance to receive the remaining subsistence allowance after the completion of the inquiry.

Dear Nandisha,

Subsistence Allowance, whether payable as per the provisions of the Standing Orders or the Service Regulations applicable to a suspended employee, is an allowance payable during the entire period of suspension in lieu of his normal wages/salary to defend his case effectively. It is at the discretion of the employer to revoke the suspension of the delinquent employee as soon as the completion of the inquiry or keep him under suspension until final orders are passed in the disciplinary proceedings. Of course, subsistence allowance should be paid by the employer for the entire period of suspension at the specified rates on the normal dates of salary disbursement even if it results in dismissal of the employee.

The principle is that in case disciplinary action ends in acquittal of the employee of the charges against him, then the suspension period is treated as on duty for all purposes, and the suspended employee is entitled to the remaining amount of wages and allowances after subsistence allowance is deducted. However, if the disciplinary action ends in punishment, then the suspended employee is not entitled to anything other than the subsistence allowance already paid. This is subject to the specific Standing Order provision applicable.

Actually, this case involves long-term absenteeism. We conducted an inquiry, and subsequently, the employee resigned before we provided the full 50% subsistence allowance. My question is, should we pay the remaining subsistence allowance after the resignation?

It lacks clarity. Basically, was he suspended? Subsistence Allowance is paid to a suspended employee. If he is not suspended, he is not required to be paid subsistence allowance. If after an inquiry, the employee has resigned, have you accepted his resignation? Please clarify the position.

Dear Nandisha,

In the first place, I don't understand the logic behind placing an employee who has long been absent merely for the purpose of initiating DP against him for the misconduct of unauthorized absence. Suspension pending inquiry is an effective weapon in the hands of the employer to prevent the employee from meddling with the DP by way of tampering documentary evidence as well as influencing the witnesses by any means like threats, cajolery, etc. At times, some delinquent employees may resort to playing smarter by dragging the inquiry unnecessarily, taking advantage of their suspension. Therefore, suspension pending inquiry should be sparingly used only to expedite the D.P. and not as an empty formality or show of power. Once the employer exercises the option, whether knowingly or unknowingly, he has to diligently comply with the provision for the payment of subsistence allowance both time-wise and scale-wise. Any lapse in this regard can vitiate the entire D.P in case of judicial scrutiny later. Therefore, notwithstanding his subsequent resignation, you have to pay him subsistence allowance till his last date of service in the organization.

Normally, no prudent employer would accept the resignation submitted by a delinquent employee when the DP is in progress or final orders are pending. What I infer is that being satisfied with the voluntary exit of the unwanted employee, the employer has accepted his resignation despite the pending D.P. and hence closed it without any further action. Even then, I am of the opinion that you have to pay him the balance amount of subsistence allowance.

Dear colleague,

What can be inferred from your posts is that you placed your employee under suspension during an inquiry into absenteeism. Following the completion of the inquiry and prior to any disciplinary action, the employee resigned, which you appear to have accepted.

In this scenario, it is presumed that you provided a subsistence allowance from the date of suspension until the employee's release upon resignation. Therefore, what remaining period are you referring to? I do not believe it is necessary to continue paying a subsistence allowance after the employee's last day of employment.

Regards,
Vinayak Nagarkar
HR Consultant

Dear Nandisha,

As per your posting, the clarification and discussion in the forum gave me an understanding that the employee was paid only 50% of the subsistence allowance out of the total dues. The employee submitted his resignation, which was duly accepted by the management. You need to settle his account by paying the remaining balance amount that is due. The subsistence allowance should be calculated from the date he was placed on suspension until the date of his resignation.