Handling Outstanding Employee Dues: What to Do When Employees Abscond?

The statute of limitations does not apply to employee dues, and the dues remain outstanding as employees may have absconded or left no forwarding address, etc. What, in this case, should be the treatment of these outstanding dues? Is there a specific Government Account where these have to be deposited? What act would govern the same?

Hi Xerxes,

Since the employee is absconding from the duties, you have to send a letter (through registered mail only) to the employee at his permanent address, stating that he is absconding from the duties since [date], so he has to come to the office and give an explanation as to why he is absent from the duties without taking permission from his senior. This letter has to be sent to him thrice with an interval of 20-25 days. After that, you have to send a final letter to him informing him that his services are terminated due to this reason and ask him to clear his dues. If he does not come to the office to complete the clearance formalities, you are not supposed to clear his payment.

As per the Bonus Act, if he is eligible for the bonus, you have to send the bonus cheque (through registered mail only) to him at his permanent address. If the cheque comes back to you, you have to send it again. If it returns again, you can deposit the amount with the Government Welfare Department.

I hope this clarifies your query to some extent.

AMATYA

Please check the Payment of Wages Act and the Payment of Bonus Act. Those who are not covered under these acts, I have not come across any specific provision for them. For those who fall under these acts, we need to deposit after the expiry of three years with the labor welfare fund. We cannot deposit before the expiry of three years as there is a limitation provided in these acts.

Siva