Stuck Without My Bonus: Should I Take Legal Action Against My Former Employer?

Served a big company for almost 4 years. I resigned on 20th July 2024, requesting to be relieved in 30 days and agreed to pay against the shortfall of the notice period that was 90 days as per the appointment letter. The resignation has been accepted, and the employer advised serving 90 days, which I denied through a return email. I served more than 50 days of the notice period and again requested to be relieved, but HR did not agree. My new employer asked me to join or terminate the offer. I wrote a final email to my old employer that I would leave today (11th Sept 2024) and requested a full and final statement enabling me to pay any dues and settle my accounts. But there was no response. I left the old organization and joined the new employer on 12th Sept 2024. Since then, I have been sending multiple emails to HR to let me know if I have to pay to settle my accounts. As per my calculations, there is no outstanding after adjusting my leaves and salary of 11 days. But I am not getting any response from them. Now they have held my bonus and PLI amount (part of my CTC as per the appointment letter). Requesting subject experts to guide me on the next course of action. Should I go for legal actions? If yes, which forum (civil court/consumer forum, or labor office, etc.)?

Regards, Krishna Sharma

Legal Implications of Pursuing Unpaid Dues

If you proceed legally, you may damage your relationship with the employer, which could negatively impact your career. Moreover, if your monthly salary was more than Rs 24,000, finding a legal solution could be challenging. In such a case, the only option might be to file a civil suit. Non-payment of statutory bonuses can be addressed before the labor authorities, but performance-linked allowances (PLI) are typically not covered. PLI is generally paid as a reward, and management reserves the right to withhold it if the employee is not expected to serve the remaining period. This depends on the contract of employment. However, the labor officer will not interfere in components of "CTC" other than statutory (minimum) wages or non-payment of wages as per the contract of employment. If the amount exceeds Rs 24,000, the officer may decline to interfere, stating that you are outside the scope of the Payment of Wages Act.

Statutory Bonus Eligibility

The bonus you have mentioned—is it a statutory bonus? If so, and if your Basic & DA for the financial year to be paid was less than or equal to ₹21,000, you are eligible for a statutory bonus. If the organization refuses to pay you a bonus, you can proceed to the appropriate authority under the PB Act for your bonus claim.

Profit-Linked Incentive (PLI)

Regarding the profit-linked incentive (PLI) mentioned in your appointment order as part of your CTC, it has no legal standing. Usually, most organizations pay it if the employee is on the payroll of the organization on the date of PLI disbursement.

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