Arrested Employee Dismissed: Can They Still Claim Subsistence Allowance?

One employee was arrested by the CBI. Subsequently, he was suspended, and an inquiry was conducted. After the inquiry, he was dismissed from the service during the suspension period. Now, he claims a subsistence allowance for the period from the arrest to the date of dismissal. Will the subsistence allowance be paid or not?

Non-payment of subsistence allowance to the suspended employee would vitiate the inquiry conducted during the period of his/her suspension. Therefore, the employer should pay him subsistence allowance even after his dismissal.

Dear Colleague,

Undoubtedly, he is entitled to a subsistence allowance from the date of suspension until the date of termination. Could you please clarify the period of suspension? If it was more than one month, why was he not paid the same amount during that time?

Regards,
Vinayak Nagarkar
HR Consultant

First, confirm whether his terms of employment, applicable standing order, or the State's Subsistence Allowance Act, if any, entitle him to a subsistence allowance.

Varghese Mathew

In the absence of all three conditions mentioned by Mr. Varghese, the suspended employee is entitled to full wages for the entire period of suspension.

The employee is entitled to a subsistence allowance during the suspended period until the termination. The employee should be paid from the date of suspension, not from the date of his arrest.

Further, you should check your standing orders dictum and act accordingly.

Subsistence allowance is payable from the date of suspension until the date of dismissal of the employee from the services of the company as per the provisions of the Industrial Employment (Standing Orders) Act and as per the provisions of Model Standing Orders if you do not have your own Standing Orders.

R R Kapoor
Vadodara