• Regarding unpaid performance linked incentive

Hi - 
I used to work for a company where I have resigned and my last working day was 31st May 2017. I have joined the company on 29th February 2016. As per the offer letter I am eligible for a 15% variable as “Performance linked incentive” (PLI) which is payable once every year. This PLI is a part of the CTC and not over and above. For 2016 (during March 2016 and Feb 2017) the PLI was supposed to be paid by April, Which was not paid for any of the employees. Till date the same is unpaid. 
The policy also says that the employee would be eligible for the PLI only when he is active in the company on the date of payment. 
When I resigned in April, I have discussed this with the HR and my reporting manager and I was given an assurance that I will get my full year PLI, even if I have resigned.
I have SMS communication on this - where my reporting manager who is also the functional head has confirmed this. She has also mentioned that the payment will be done with my full and final settlement. Last week I have got my full and final settlement but no PLI. 
I am continuously in touch with the Head - HR, she is only saying that "There is no decision made on this subject as yet - if the organization makes any decision on the PLI payment and I will be informed about it"
My question now is - 
1) Why and what basis I was given a confirmation before I have resigned that I will be paid my PLI with my Full and final settlement? Is this not a false and miscommunication? 
2) How secured I am now, since I am no more in the company and the policy very clearly tells that the employee has to be active when the payment is being made?
3) How can the employer delay the payment and not even giving the employees and timeline for the payment for the money which is a part of CTC?
Please help / advice for the appropriate action on this...

Thanks and Regards
Jaydeep Sarkar
Asked 7 years ago in Labour

2 answers received in 30 minutes.

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7 Answers

1.ell,i am sure that this PIL scheme was made in writing when you joined so you can exercise your legitimate right to claim your sahre of PIL. If that is so then the company rightly admitted his liability to make such payment on your resignation . But they have caused now breach of contract by delaying the whole payment.

2. Since you raised the claim at a time when you were active in the company ,your share of PIL for the effort you did at tt time it can never be taken away.The language is importer and hence it is giving rise to the confusion.

3.Since it is considerable delay send them a legal notice one final time claiming your money and if they refuses to pay the money to acknowledge your claim the lodge a criminal complaint of cheating and criminal breach of trust.

4.You can also file a civil suit for recovery of the money.

Devajyoti Barman
Advocate, Kolkata
22825 Answers
488 Consultations

5.0 on 5.0

1) the company ought to honour its commitment to pay you PLI as per confirmatory message sent to you

2) however since you are not in service at time of making payment the company may try to wriggle out of its commitment to pay you PLI

3) you can issue legal notice to company to pay you PLI as offer letter mentioned you are entitled to 15 per cent PLI

Ajay Sethi
Advocate, Mumbai
94731 Answers
7536 Consultations

5.0 on 5.0

Hi

1) It appears that the Organisation is yet to decide on the Performance Linked Incentive amount for (March 2016 to Feb 2017) and it is surprising that PLI is yet to be finalized even after passage of 4 months.

2) Also surprised by the fact that HR did not take your case to your management (to decide on your PLI) when your Full and Final Settlement process was ON as it is a practice to pay "Good Leaver's/ Exceptional Performer's" a part of PLI along with FFS and remainder along with the remaining employees

3) So in order to protect yourself, please send an Email to your Human Resources Head asking him/ her to confirm on

1) Quantum of PLI that is to be received by you, given that Full and Final Settlement has already been done.

(Since PLI is always linked to company performance and that there is a strong correlation between individual, team and company performance and PLI'S, it is always better to know the Quantum of PLI instead of asking when you will pay the PLI)

2) In general, companies do not pay PLI to employees serving notice period or to employees who have exited the company. However it all depends on the company recognizing the contribution of such employee and many companies make exception so as to make PLI payment to resigned/exited employees.

3) If PLI is part of CTC and the same is mentioned in your appointment letter (not offer letter), then the companies cannot delay/ deny the payment of PLC as Indian contract act will kick in if the company fails to perform its duty of making Payments(PLI included) as prescribed in appointment letter/ employee hand book/ PLI policies...

Hope this information is useful.

Rajgopalan Sripathi
Advocate, Hyderabad
2173 Answers
394 Consultations

5.0 on 5.0

1) Why and what basis I was given a confirmation before I have resigned that I will be paid my PLI with my Full and final settlement? Is this not a false and miscommunication?

I think no one in the company has been paid the PLI this year so far, if so wait for the decision by the company about this.

2) How secured I am now, since I am no more in the company and the policy very clearly tells that the employee has to be active when the payment is being made?

If you are so much worried about this situation. you may write to the company seeking payment of PLI and send the demand letter to the top management by registered post.

This is not only a documentary evidence for next legal step but also it will go the knowledge of the top management officially, which may invoke some response.

3) How can the employer delay the payment and not even giving the employees and timeline for the payment for the money which is a part of CTC?

Please help / advice for the appropriate action on this...

You may exhaust the remedies with the company first and then plan to aproach legally on this issue.

T Kalaiselvan
Advocate, Vellore
84932 Answers
2197 Consultations

5.0 on 5.0

When you have officially resigned from the company on 21.04.2017, and you were relieved the same day, yo may not be entitled for PLI for the period you have not worked with the company.

The full and final settlement shall be towards your entitlement whereas the PLI shall be based on yor performance in the work. When you hav not worked then where is the question of performance.

T Kalaiselvan
Advocate, Vellore
84932 Answers
2197 Consultations

5.0 on 5.0

Hi

If the variable amount has been deducted from your April and May salary, ideally your employer should have returned you these amounts along with your FFS.

You are entitled for refund of variable amount so deducted from your April and May salary.

Not granting PLI and also not refunding the variable amount is a double jeopardy for you.

Please draft a mail claiming the PLI and the refund of variable amount from your company.

Sure can help in case you need further help.

Rajgopalan Sripathi
Advocate, Hyderabad
2173 Answers
394 Consultations

5.0 on 5.0

you can claim the 2 months deduction

2)you can contact MR Rajgopalan by seeking phone consultation from the website

Ajay Sethi
Advocate, Mumbai
94731 Answers
7536 Consultations

5.0 on 5.0

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