Navigating Statutory Dues for a Deceased Employee with Multiple Heirs: Who Gets What?

Respected elders,

Greetings and best wishes for the day.

Guidance on settling statutory dues for a deceased employee

Kindly suggest in a case where an employee passed away in a road accident while working in a manufacturing factory/industry since 2000. While he was alive, he married a woman and had a son. After some years, his first wife passed away, and he remarried another woman, with whom he had children. Now, following his death, both the son from the first marriage and the children from the second marriage are claiming PF dues, gratuity, and other settlements, asserting that they are the legal heirs. They have submitted legal heir certificates issued by the Revenue Department of Telangana State. The management is now facing a dilemma regarding whom they should settle the statutory dues, etc. Please provide guidance on this matter.

Thank you.

Legal Heirs and Nomination in Employee Benefits

The wife as well as the son are both legal heirs as per the personal law of the deceased. Therefore, both have a claim for the benefits. If the employee had made a nomination, then you must adhere to the nomination and pay the sum due to the respective nominee. Importantly, the nominee has only the right to receive the amount but cannot entirely appropriate it. The other legal heirs have a claim against the nominee for their rightful share; the employer is not a party to it.

Handling Intestate Situations

If the employee died intestate (i.e., without any nomination), then the following suggestion could be considered. Regarding Gratuity, the Controlling Authority under the PGA 1972 (the Assistant Commissioner of Labour) is competent to decide who should get what benefit, so the gratuity amount must be deposited with this authority. As for PF, forward the claims received to the PF authorities certifying the facts of the matter. In terms of other payments like unpaid salary, leave encashment, or any other welfare sum, follow the nomination if it exists. You may consider calling both parties and try to make a rapprochement between them on how the amount has to be divided and advise them against any frivolous litigation which will only delay the disposal of the matter and entail uncalled-for expenses.

Hi, In case of any dispute among legal heirs regarding the sharing of the full and final settlement, please direct all eligible legal heirs to obtain a Succession Certificate through the competent Civil court. This way, the employer can safeguard their interests. Though it may be a time-consuming process, following the court's verdict will prevent any legal heir from challenging the employer's decision.