This article is written by Anshal Dhiman. The article talks about the non-payment of salary by an organization and the remedies available for the same.
Table of Contents
Introduction
One of the most critical issues of our country is lack of awareness. The Covid-19 pandemic had a huge impact on the employment market. No matter the size of firms or companies, all of them suffered huge losses. The employees of these companies had to suffer the most grunt of it. The company going through any financial or debt crisis had to rely on some unfair practices. One of which is non-payment of salaries or delayed salaries to their staff and especially the one who is getting fired.
It’s a very common practice to make half or no payment to employees at the time of firing them. The employers of these companies take advantage of their employees’ lack of awareness about the rights available to them. Their deprivation of rights occurs owing to the notion that the employees don’t have other options or resources to proceed against the company. But the employees have every right to get their fair share of salary no matter the financial conditions of the company.
Keeping it in mind, Let’s begin with the basics.
What is a legal notice?
Legal Notice is a formal document to the person or an entity to inform the other party about the intention of the individual or group to undertake a formal proceeding against them in the court of law. It is generally sent to make the other party aware of our intention regarding the complaint. It is a formal written communication between the parties. It contains all the complaints and facts of the matter of the sender and provides an opportunity to settle the grievances without going to the court.
It’s kind of an Early Warning System [EWS] before a full-fledged trial begins. A legal notice is filed as per Section 80 of CPC, 1908 and it can be only filed in civil matters. It’s necessary for a person writing such notice to stick with a format while drafting such a legal notice. It is usually recommended to hire a legal professional to draft such Notice to deal with such technicalities. A well-drafted legal notice can help you in securing the best deal.
What do you understand by the non-payment of salary?
The situation of ‘non-payment of the salary of employees or delayed payment’ means ‘not getting paid for the work done’. Due to the unforeseen circumstances of the pandemic, our economy has taken a turn to the worst. Not just the startups but also big companies got caught in this economic storm.
But it is unfair, unethical and illegal to deprive the employees of your company of their rights. Making excuses so that they don’t have to pay their employees. Postponed installment or delinquency of compensation is the most widely recognized issue of numerous workers nowadays. This issue escalates when the organization is experiencing difficult stretches, say for any monetary or obligation emergency. Indeed, even at the hour of terminating any worker, it is regular wonders that business didn’t make the full and last instalment of the multitude of levy of a representative. However, the worker has every right to get his or her compensation for the work performed. They are denied this privilege since they imagine that representatives have no alternatives or the assets to continue an argument against a business.
The sad truth is that only a handful of employees are aware of their rights that if they are not being paid for their work, they can sue the company in the court of law. Even those who are aware don’t want to get involved in this spiral of court dates and long procedures. This reason boosts the employers resort to unfair trade practices and the spiral goes on. In the event wherein the organization doesn’t come up with a feasible goal plan, then the organization will be sold. So it is presently not that simple to avoid the compensation of the representatives of an organization. The workers simply should know about such late legitimate changes engaging them to recuperate their due compensation from their manager for which they are lawfully entitled.
A sample legal notice can be seen here.
Acts governing the salary payment by organizations
- Contract Labour Act, 1970
- Shops and Establishment Act, 2016
- Wages Act, 1948
- Industrial Dispute Act, 1947
Legal remedies for non-payment of salary
In India, the pace of legitimate mindfulness isn’t exceptionally high and very few deceitful chiefs and associations prevent the representatives from getting their well-deserved cash. Regardless, nowadays, non-instalment of pay is perhaps the most broadly perceived issue looked at by a delegate during the course of their work. In such a situation instead of feeling manhandled, the specialist can send a lawful notification for non-instalment of compensation.
There are certain establishments where it is mandatory to serve an authentic warning before going into a case. For ex-in the matter of check skip, it is necessary to send a legal warning to the social occasion being referred to before the issue takes into court. A legal notice is a notice that shows the enemy in the wake of serving that legal action can be begun in the court upon non-fulfilment of demand. A legal notice may take 2-3 days for its recording. In the event wherein business doesn’t settle up your compensation, you can move toward the work chief. They will assist you with accommodating this matter and if no arrangement has arrived at work official will surrender. This makes a difference to the court whereby a body of evidence against your manager might be sought after.
Under Section 21(1) of the Contract Labour Act, a worker will be liable for the portion of wages to each worker used by him as temporary work and such wages will be paid before the expiry of such period as may be suggested.
On the off chance that the transitory labourer fails to make a portion of wages inside the suggested period, by then the primary business will be committed to making a portion of wages in full or the neglected levelling. This might be a result of the temporary work used by the authoritative specialist and recover the aggregate so paid from the impermanent labourer. This might be done either by inference from any entirety payable to the agreement based labourer under any understanding or as a commission payable by the agreement based specialist.
Many states have their own enactment overseeing the direction of different shops and foundations inside their States. As indicated by the arrangements of the Act, where any specialist is required to deal with any day more than nine hours and forty-eight hours in seven days, he will be qualified for compensation at the pace of twice his customary pace of wages or such higher amount as may be prescribed. If the business damages any arrangements of the Act or any standards made under this Act by the State Government including non-instalment of wages the individual is obligated to pay a fine that may reach out to Rs. 2 Lakhs. The extra-fine can likewise be imposed.
The Minimum Wages Act, 1948, and the Payment of Wages Act, 1936 are the two key establishments that manage and control remuneration paid by the business to the labourer. The past Act attempts to fix the most reduced compensation allowed by law that should be guaranteed to all subject matter experts. The proportion of offer is settled with appreciation to the possibility of the work, which is referred to in the Schedule of the Act. The most reduced compensation allowed by law differs from state to state. Then again, the Act ensures opportune instalment of wages to the worker or the labourer.
Section 33C of the Industrial Disputes Act manages the recuperation of cash that is expected to be paid to the representative. As per this arrangement, any worker or somebody approved by the representative, or lawful beneficiary if there should arise an occurrence of the perished representative can document an application for the instalment of pay to the proper government. On being satisfied that much cash is expected, the fitting government gives a declaration for the instalment of contribution. Be that as it may, on the off chance that there is a need to register the measure of cash, at that point, it will be chosen by the labour court. Cases have to be decided by such labour court within a period not exceeding three months provided that where the presiding officer of a labour court considers it necessary or expedient to do so, he may for reasons to be recorded in writing, extend such period by such further period as he may think fit.
Documents needed to send a legal notice to a non-payer are:
- Copy of employment contract.
- Copy of bank statement as evidence for non-payment of salary.
- Appointment letter.
- Details of all additional benefits and perks.
Procedure for sending the legal notice
You should enlist the top employment legal counsellors in your region to help you draft a lawful notification for the recuperation of neglected duty to be shipped off to your boss. The lawful notification will be drafted and shipped off to you for endorsement. The last lawful notification will be drafted using your suggestions (if any). The lawful notification will be shipped off to your manager by an enlisted post. The subtleties of the enlisted post will be imparted to you.
If even after sending the legal notice, the party at default doesn’t make the payment or on the off chance that a business doesn’t pay compensation, the representative can deal with the work chief. They will attempt to accommodate the matter and in the event that is not figured out, at that point, the matter will go to the court. Under the Industrial Dispute Act, 1947, a representative can record a suit for the recuperation of cash due from a business within 1 year of the time span from which the compensation is expected. Within three months, the work court needs to choose such cases. In the event wherein the worker is a director of the association or at some other post over the chief level, by then he may moreover record a suit in the regular court according to the plans of Civil Procedure Code, 1908. An Application can also be filed in the NCLT (National Company Law Tribunal).
In the event wherein you are the chief or leader level representative, you can record a body of evidence against the organization in the common court. It is quicker than the standard sluggish technique in common courts, called a synopsis suit. It is very viable, however, ought not to be sought after as a first retreat. There are simpler things available to you also. Out of 100 cases, perhaps 5-7 requires such exertion, notwithstanding numerous legal counsellors rush to leap to this. Prior to selecting this, make a request that your attorney exhausts different methods.
Conclusion
The article talks about the legal remedies in general that a person may take when he is not receiving his salary from the organisation he is working in. The issue is very complicated as many employees in the modern days face this issue, which makes it hard for them to live their regular life since money controls everything. A legal notice is one of the first and basic elements that is involved in a legal procedure. It acts as a warning. The article talks about how to send a good legal notice so that the organisation that is not paying money acts up and completes its responsibility so that the rights of the employee are not violated and he’s not exploited by the bigger organisations.
References
- https://lawcorner.in/legal-notice-in-the-matter-of-non-payment-of-salary/
- https://blog.ipleaders.in/what-to-do-if-employer-does-not-pay-salary/#:~:text=If%20an%20employer%20doesn’t,your%20employer%20may%20be%20pursued.
- https://www.soolegal.com/rc/legal-notice-to-a-company-for-non-payment-of-salary
- https://lawyerinc.net/learning/legal-notice-for-non-payment-of-salary-with-format/
- https://lawcorner.in/legal-notice-in-the-matter-of-non-payment-of-salary/
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