If you are stuck in such a situation, here is what to do.

Mr. Alok Verma, a resident of Nagpur, recently faced a distressing situation with his former employer, a well-known technology firm named “Quantum Innovations Ltd.” After resigning from his position, he discovered that the company had not paid his salary for his final month of service, February 2025. To make matters worse, upon checking his records, he found that while the company had been deducting Provident Fund (PF) contributions from his salary every month from April 2024 to February 2025, none of this amount was ever deposited into his EPF account.

The company’s deceit was further compounded when they issued him a Form 16 which falsely declared that his entire salary for the financial year, including the unpaid month of February, had been paid in full. When Mr. Verma tried to follow up with the company’s HR department, he was met with a series of false promises and delaying tactics. He learned that other employees who continued to work there had received their salaries for subsequent months, indicating that the issue was specific to his dues. Feeling cheated and helpless, Mr. Verma sought legal guidance to recover his hard-earned money and hold the company accountable for its fraudulent actions.

Advice in such cases

• Gather all relevant documents immediately. This includes your appointment letter, salary slips, bank statements, Form 16, and any communication with the employer regarding the unpaid dues.
• Send a formal legal notice to the employer through a lawyer. This notice should clearly state your claims, including the unpaid salary and the non-deposited PF amount, and provide a deadline for the company to settle the dues.
• File a complaint with the Labour Commissioner in your jurisdiction. The authorities can mediate and issue orders for the recovery of unpaid wages.
• Simultaneously, file a complaint with the Employees’ Provident Fund Organisation (EPFO). Non-deposit of PF contributions after deduction is a criminal offense, and the EPFO can initiate proceedings against the employer.
• Consider filing a criminal complaint with the police for criminal breach of trust and cheating, as the deducted PF amount has been misappropriated by the employer.

Applicable Sections of Law

Several laws protect an employee’s rights in such a scenario. The primary legal provisions applicable are:

• The Payment of Wages Act, 1936: This act governs the payment of wages to employees and provides a remedy for delayed or unpaid salaries.
• The Industrial Disputes Act, 1947: This provides a mechanism for the recovery of money due from an employer.
• The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952: Section 14 of this Act prescribes penalties for employers who fail to deposit the PF contributions deducted from an employee’s salary.
• Bharatiya Nyaya Sanhita, 2023 (BNS): Section 316 of the BNS, which deals with Criminal Breach of Trust, is directly applicable. An employer deducting PF and not depositing it is a clear case of criminal misappropriation of funds entrusted to them. Section 318 (Cheating) can also be invoked.
• The Companies Act, 2013: In certain cases, the directors of the company can be held personally liable for such statutory violations.

If you are the complainant

• Your first step is to consolidate all your evidence. Create a file with your employment contract, all payslips showing PF deductions, bank statements proving non-payment of salary for the specific month, your EPF passbook statement showing the non-deposit of funds, and copies of all emails or messages exchanged with the company.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think
• Based on your lawyer’s advice, dispatch a strongly worded legal notice to the company’s registered address. This is often the most effective first step, as many companies prefer to settle the matter to avoid legal proceedings.
• If the notice does not yield results, proceed with filing formal complaints with the Labour Office and the EPFO. These bodies have the power to investigate and pass orders for recovery.
• For the criminal aspect, your lawyer can assist you in filing a complaint with the police, ensuring it is framed correctly to highlight the criminal breach of trust, which can lead to the registration of an FIR under Section 173 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS).

If you are the victim

• Do not rely on verbal assurances from the HR or management. Keep all communication in writing, preferably over email, to create a paper trail.
• Act promptly. There are limitation periods for filing complaints under various labour laws, so do not delay taking action.
• Maintain a calm and professional demeanor, but be firm in your demand for what is legally yours. Avoid emotional outbursts in your communication with the company.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think
• Understand that the legal process can take time. Be patient and follow your lawyer’s guidance diligently through each step.

How the police behave in such cases

Often, the police may initially perceive such a complaint as a civil or labour dispute and might be reluctant to register an FIR. They may advise you to approach the Labour Court. However, the non-deposition of deducted PF is a cognizable criminal offense under Section 316 of the BNS (Criminal Breach of Trust). A competent lawyer can present the facts clearly, emphasizing the criminal element of the act. By submitting a well-drafted written complaint citing the relevant legal provisions, you can press the police to register an FIR and initiate a criminal investigation against the employer and its directors.

FAQs people normally have

What evidence is required?

The most crucial pieces of evidence you will need are:

• Your appointment/offer letter to establish the employer-employee relationship.
• Salary slips clearly showing the deduction of PF contributions.
• Bank account statements to prove the non-receipt of salary for the disputed period.
• The EPF passbook or statement from the EPFO portal, which will serve as direct proof that the deducted amounts were not deposited.
• Any written communication (emails, letters, text messages) with the company regarding your unpaid dues.
• Form 16 issued by the company, which can be used to prove fraud if it shows paid salary that you never received.

How long will the investigation take?

The timeline can vary significantly depending on the legal route taken. A legal notice might resolve the issue within 15-30 days if the employer is cooperative. Proceedings before the Labour Commissioner or EPFO can take several months. A criminal case, once an FIR is filed, will follow the course of the criminal justice system, which can be a lengthy process involving investigation, chargesheeting, and trial. However, the pressure of an ongoing criminal investigation often compels employers to settle the matter out of court.

Advocate Sudhir Rao, Supreme Court of India