Struggling to Recover Unpaid Wages and Gratuity After Company Closure: What Can We Do?

Background of Employment and Company Sale

I was working in a corporation Ltd company for 18 years. Due to the financial difficulties and over liabilities of the company, the management decided to sell it. Accordingly, the company was sold, and all employees were transferred to the new company with service continuity. The new company operated the unit for 4 years and then attempted to sell it to another party. Gradually, they ceased business operations. Meanwhile, many employees were laid off. Eventually, only 4 to 5 people were working, and we also resigned and left the company. Currently, the company is completely closed, with only security personnel maintaining it.

Challenges Faced During Employment

During our period of service, the employer did not pay salaries or provide services to the remaining employees. In the worst-case scenario, all remaining employees left the company. Personally, I am owed 6 months' salary and have not received my gratuity. We have filed a case against the employer in the labor court, and the case is ongoing. In this case, only the previous employer's advocate has attended the court, while the purchasing employer has not appeared or replied to the court. We are in a difficult situation. I am around 53 years old and unable to find a job in a reputed company.

Request for Advice

Please advise me/us on further possibilities to receive our overdue wages and benefits.

Nature of the Case Pending Before the Labor Court

There is no mention in the post about the nature of the case pending before the Labor Court—whether it is a dispute referred under section 10 of the Industrial Disputes Act, 1947, or a joint claim filed under section 33C(2) of the Act for the recovery of money due to the workmen is also not known. Anyway, the fact is that the company switched hands along with its employees, maintaining continuity of their services, and eventually reached the stage of closure while all the workmen left the company on their own gradually before its closure due to the continued non-payment of wages for months.

Types of Claims

Therefore, if at all, there can be only two types of claims: one is gratuity, and the other is unpaid salary until the respective dates of resignation of the workmen concerned. Of course, the Labor Court is empowered to entertain and dispose of the claims of unpaid wages under section 33C(2) but cannot decide the claim relating to gratuity. For gratuity, you have to file claims before the Controlling Authority under the Payment of Gratuity Act, 1972, only. Anyway, you have to await the outcome of these legal proceedings of recovery only and have no other option. It would be better to urge your counsels to file expedite petitions before the concerned forum.