Time limit to deduct Advance amount from salary - employee says advance more than 1 year old is not valid

The employee took an advance from the company in 2017 and always requested not to reduce it from salary to the company. Now he is planning to leave job but says advance more than 1-year-old is not valid so that amount should not be deducted from his FnF. How to recover advance?

There is no problem if you would recover from the salary payable to him, say August salary payable is September. I presume since he is yet to submit this resignation there is going to be Notice period & salary therefor. You may have to face & manage reg.minimum take home salary. Do you have documentary evidence of paying the advance? He should not refute the very payment of adv. to him, take care. The salary advance normally to be recovered within say 11 installments. Having not recovered so far is your fault. Using your discretion you deferred the recovery from 2017 till now. You learnt a lesson now. Ofcourse you can not recover from EPF & Gratuity

Employee if taken advance,and if the proof of advanxe taken is there ,it can be recovered any time.

Depending upon quantum of advance disbursed, you can choose the recovery options.
Please recover the advance at the earliest. If he has resigned, this amount should be recovered
from full and final settlement amount or any other amount payable to him by the company, but certainly not from PF dues or Gratuity payment.

There is no limitation of one year prescribed for recovering advance from salary. This is so particularly since the employee has been requesting to defer the recoveries. Every time such request is made the limitation gets extended. As per Article 61 of the Limitation Act,1963 allows suits filed recovery for advances upto three years and the period gets extended when there is request for delaying the recovery.

3 years time? Have you got any documentary evidence for paying the advance/loan amount. Have you ever asked him to give requesting letter for not deducting the dues. Check these documents. Ask him to pay the dues. There is no time limit for recovering the loan recovery or salary advance dues from the employees.

Dear friends,

Payment of Salary advance (other than refundable adv.from EPF A/c) recoverable in convenient installments, as per operational convention & past practice is observed in an establishment. Generally it's admin is properly guided by certain SOP. These advances are meant to defray urgent commitments expenses/payments such as urgent/emergency like hospitalisation, domestic events, education & festival related exp.etc. The recovery thereof is made in such a way that it's closed within a year so that the employees become eligible for the fresh advance again. The analogy is that only one advance is under recovery at a time and atleast once in a year an advance is paid and no arrears is pending at the time of application for advance is processed. In small offices it so happens that the concerned approaches the authorised officer to defer the recovery a month or a few months to tide over critical situations such that take home pay without deduction will be of help. Though there is no hard & fast rule governing the administration of salary advances, w.r.t. to quantum or reason for grant/periodicity of recovery of advance etc. localised practices comeinto play.

In the instant case there's no second opinion to its recovery fully. However, in case of gratuity payment an employer has no option to delay beyond a month as any further delay would attract accrual of interest till it's paid or deposited with the authorised officer. May be acceptance of resignation or withholding relieving letter/experience letter may be among options available to the management if the exiting employee doesn't budge.