It is an increasingly common and distressing scenario for employees across various sectors in India. Consider the case of Mr. Rohan Kumar, who joined a promising tech firm, “Innovate Solutions Pvt. Ltd.,” in the city of Jayanagar. His initial months were productive, but soon the company delayed his salary for two consecutive months. When he professionally followed up with the HR department, instead of receiving his dues, he was served a formal notice. The notice falsely accused him of “unauthorized absence” and “dereliction of duty,” threatening termination and legal action to recover supposed damages. The company was using these threats as leverage to avoid paying his legitimate salary for work he had already completed. This tactic of intimidation, coupled with the withholding of rightful earnings, places employees in a vulnerable and stressful position.
Advice in such cases
If you find yourself in a similar predicament, it is crucial to act calmly and strategically. Panicking or reacting emotionally can weaken your position. Here are the immediate steps you should consider:
Document Everything: Maintain a clear record of all communication. This includes emails, text messages, official letters, and even notes from verbal conversations. Keep your appointment letter, payslips (if any), and bank statements showing previous salary credits.
Formal Written Communication: Do not stop communicating, but ensure it is formal and documented. Respond to any notices professionally via email, refuting false allegations with facts and reiterating your demand for pending salary. State your willingness to complete your work obligations once your dues are cleared.
Do Not Resign: Avoid resigning under pressure, as this might be construed as absconding and could affect your ability to claim dues and fight a potential case. Let the employer take the step of termination if they wish to; this will strengthen your case for wrongful termination.
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.
Applicable Sections of Law
The legal framework in India provides several protections for employees against non-payment of wages. The primary recourse is through labour laws, but contract law and even criminal law can be relevant.
The Code on Wages, 2019: This code consolidates and simplifies laws relating to wages and bonuses. It mandates the timely payment of wages and provides a mechanism for employees to file claims with the designated authority for unpaid salaries, irrespective of their wage level or position.
The Industrial Disputes Act, 1947: While many of its provisions are being subsumed into new codes, it remains relevant for disputes concerning termination, unfair labour practices, and conditions of service. Withholding salary can be considered an unfair labour practice.
Indian Contract Act, 1872: An employment agreement is a contract. Non-payment of salary is a fundamental breach of this contract, entitling the employee to sue for recovery of the amount due and potentially for damages.
Bharatiya Nyaya Sanhita (BNS): In extreme cases where there is an element of deceit from the very beginning or threats are involved, certain provisions may apply. For instance, if the employer’s actions amount to criminal intimidation to prevent you from demanding your legal dues, Section 351 of the BNS could be invoked. However, police are often reluctant to register FIRs in what they perceive as civil or labour disputes.
If you are the complainant
As the employee who has been wronged (the complainant), you are the one who needs to initiate action. Your goal is to recover your salary and protect yourself from the employer’s threats.
Send a Legal Notice: The first formal step is to have a lawyer draft and send a legal notice to the employer. This notice will detail your employment, the work performed, the salary owed, and a deadline for payment, failing which you will pursue legal remedies.
File a Complaint with the Labour Commissioner: You can file a complaint before the Labour Commissioner or the authority appointed under the Code on Wages. Your tenure of employment or the salary amount does not bar you from filing this complaint. This is often the most cost-effective and quickest route.
Initiate a Civil Suit: You can file a summary suit or a regular civil suit for the recovery of money in a civil court. This can be a longer process but is a powerful tool to enforce your contractual rights.
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.
If you are the victim
Being a victim of such corporate malpractice can be demoralizing. It is important to remember that the law is on your side, provided you take the right steps.
Gather and Organize Evidence: Systematically collect all proof of your employment, work done, and communications. This includes your offer letter, emails about project delivery, attendance records, and any communication regarding the non-payment of salary.
Do Not Be Intimidated: Threats of legal action by the employer are often scare tactics designed to make you abandon your claim. A company filing a lawsuit against an employee for “damages” has to prove actual, quantifiable loss caused by that specific employee’s actions, which is often very difficult.
Seek Professional Help: Do not try to navigate this complex situation alone. The legal and procedural nuances require expert guidance.
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.
How the police behave in such cases
Generally, the police do not intervene in matters of salary disputes. They correctly view these as civil or labour-related issues. If you approach a police station, they will most likely advise you to go to the Labour Court or consult a lawyer to file a civil case. Police will only register an FIR (First Information Report) if a clear cognizable criminal offense is made out, such as criminal breach of trust, cheating from the inception of the contract, or credible threats to life or limb under the BNS. Mere threats of “legal action” do not typically meet this threshold.
FAQs people normally have
Can my employer really sue me and cause serious trouble?
While anyone can file a case, winning it is another matter. If you have been performing your duties, such a lawsuit is likely a pressure tactic. The employer would need to provide concrete evidence of financial loss directly caused by your alleged negligence, which is hard to do. With a good lawyer, you can effectively defend against such frivolous litigation.Is my short tenure or low salary a disadvantage in filing a complaint?
Absolutely not. The right to be paid for work done is fundamental and applies from the first day of employment. Labour laws, especially the new Code on Wages, are designed to protect all employees, regardless of their salary bracket or how long they have worked.What if the Labour Office is not effective? What are my other options?
If the proceedings before the labour authorities are delayed or do not yield results, your strongest alternative is to file a civil suit for recovery of your dues in the appropriate court. Your lawyer can guide you on the jurisdiction and procedure for this.
What evidence is required?
Strong evidence is the backbone of any legal case. You should meticulously collect the following:
Employment Contract/Appointment Letter: This is the primary document establishing the employer-employee relationship and terms like salary.
Communication Records: All emails, WhatsApp messages, and letters exchanged with HR, your manager, or management regarding your work, attendance, and pending salary.
Proof of Work: Any documents, project files, reports, or emails that show you have completed the work you were assigned.
Salary Slips and Bank Statements: Previous salary slips and bank statements showing the pattern of salary payment before it was stopped.
The Notice from the Employer: The formal notice threatening termination or legal action is a crucial piece of evidence to show their retaliatory intent.
How long will the investigation take?
The timeline for resolution can vary significantly. A case before the Labour Commissioner is generally faster and may be resolved within 6 to 12 months. However, a civil suit can be more time-consuming, potentially taking anywhere from a year to several years, depending on the court’s workload, the complexity of the case, and the tactics employed by the opposing side. A well-drafted legal notice from a reputed lawyer can sometimes lead to a much quicker settlement, as many companies prefer to avoid lengthy litigation.
Advocate Sudhir Rao, Supreme Court of India