Facing 7 Months Without Pay: Legal Steps and Career Risks of Staying with My Company

I have been working in this organization for about 9 months and have only received the salary for two months. My company has not paid salaries for the last 7 months. They claim they are experiencing a financial crunch and will pay once they receive money from customers. This affects all employees in the organization. I have sent multiple emails asking for clarification on the salary delay, and many of my colleagues have done the same. However, we only receive vague reasons and false dates for salary disbursement; the day comes, but the salary does not. They do generate payslips every month-end.

Legal avenues for salary issues

Two things I want to know: 1. Is there a legal avenue I can pursue to resolve this? Have there been any similar past incidents that have been resolved through legal action?

Career implications of staying with the company

2. Can being associated with this company for longer than this cause problems with my career going forward? I have heard the HR department of the company is also shutting down, and I am worried about what will happen if I can't get paperwork after I leave.

Thanks

If you are a workman under the ID Act, please go to the Labour Directorate of the State and register your grievance.

If you are a management staff member, it is advisable to begin searching for a new job as soon as possible and then leave the organization.

S K Bandyopadhyay (WB, Howrah)
CEO, USD HR Solutions
[Phone Number Removed For Privacy-Reasons]
[Email Removed For Privacy Reasons]

Hi, Regarding your first question, there may be legal avenues to pursue in this case. Nonpayment of wages is generally considered a violation of labor laws in most jurisdictions. I would recommend consulting an employment lawyer who can advise you on your rights and options for recovering the owed compensation. They may be able to provide insights into similar past cases and the potential outcomes of legal action.

As for your second question, an extended period of nonpayment from an employer can certainly raise questions and concerns for future job prospects. Prospective employers may wonder about the circumstances and could be hesitant to hire someone associated with a company that appears to be in financial distress. However, I would encourage you to be proactive in highlighting your skills, experience, and professionalism throughout the job search process. Emphasize your dedication to your work and the steps you have taken to address the salary issue.

Regarding the potential HR shutdowns, it is understandable to be concerned about obtaining necessary paperwork. I would recommend reaching out to the HR department as soon as possible to request copies of your employment records, such as pay stubs, W-2 forms, and any other relevant documentation. This will help ensure you have the necessary information to support your employment history and financial records, should you need to provide it to future employers.

Thanks

I have always been surprised when I see people who have worked for months and months without pay. My suggestion is that you leave with immediate effect. There is very little chance of you getting a salary by staying. You can go and file a complaint with the labor commissioner. If you are a manager, they are unlikely to help you. But then the only way is to fight it in court (which is expensive and probably will not give you results for years and years and years).

Will this affect your career? Probably, because when the next company tries to do a BGV, they will not get a response and may consider this as fake experience.

Payment of wages as a statutory right

Payment of wages to a workman is a statutory right both under the erstwhile Payment of Wages Act 1936, as well as the Code on Wages Act. Financial hardships cannot be a ground for the company to delay your wage payments. You can complain to the Labour Commissioner. Though you can resign (as an alternative option), your next company will ask for your last payslip, and this incident will show.

For any legal advice on the subject, you can email: [Email Removed For Privacy Reasons]. However, all consultations are paid for.

Regards,
Lex Loretta