• Employer refuses to pay Leave Encashment and Annual Bonus for reasons not mentioned during my tenure

Dear Ma'am / Sir

I worked for Indus Trust - governing arm of Indus International School from 14-May-2015 to 15-Jan-2021. They have refused to pay Leave Encashment and Annual Bonus on prorata basis for the 2021 - 22. Reason given by Chief Financial Officer is as follows:

1. Annual Bonus: Kindly note that it has been our practice that we pay Annual Bonus, only to those who are on rolls, as at the date of payment of Annual Bonus. This, we have been consistently following for all these years. Accordingly, you are not entitled to Annual Bonus that becomes payable on 1st September 2021. [ My comment Neither this has been mentioned in my Letter of Appointment nor by a seperate communication during my tenure]

 2. Leave Encashment: Because, during most of the last year, all were working from home, and, to help the employees, there were no conditions and restrictions, whatsoever imposed, on availing the leave. Therefore, one cannot justify that, he has carried forward his leave. Accordingly, it has been decided not to provide for Leave Encashment for everyone across Indus Group. Therefore, nothing is payable to anyone on this account. Accordingly, you cannot be made an exception to this please[ My comment no such communication was made between March 2020 till 15-Jan-2021]
Asked 4 years ago in Labour

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12 Answers

Weird! This is nothing but stating that they won't give you any money/salary. You should send them a legal notice and the schools have taken fee from children/students. The educational institutions are under an obligation to pay salary.

File a case before the labour court.

Rahul Mishra
Advocate, Lucknow
14114 Answers
65 Consultations

Yeah all these discrepancies are part of a cover up process so as to misappropriate the funds of employees.


A legal notice must be sent and arrears be demanded and in case of non compliance a suit must be filed immediately. That is the solution. I don't think that they are going to give you your money so without going to court.

Rahul Mishra
Advocate, Lucknow
14114 Answers
65 Consultations

 

On both the counts you have a good case against management.

  1. The restriction on payment of bonus is not mentioned in you service agreement, neither at the time of relieving you on 15th January you were intimated any such restriction.
  2. Working from home does not mean that taking rest at home, practically working from home is more strain. Statutory leave is matter of right, it is not by choice you were working from home.
  3. Issue them lawyer's notice seeking recovery of arrears within a week warning of legal action also mark copy of notice to Director of School Education. After that file a suit in civil Court as you are a teacher, labor Court has no jurisdiction to adjudicate your grievance.  

Ravi Shinde
Advocate, Hyderabad
5125 Answers
42 Consultations

For the purpose of gratuity Labor Court is appropriate forum. File a complaint under Section 7 of Payment  of Gratuity Act, 1972 for recovery of proper gratuity. Labor Court will issue a certificate to the district Collector for recovery which  will be collected as arrears of land revenue from management.

Ravi Shinde
Advocate, Hyderabad
5125 Answers
42 Consultations

I always maintain - There is no law applicable in India for schools and hospitals.

 

-  Did they paid leaves to people who were working from home or there was salary cuts for smallest possible things. I know many colleges and schools which were passing rules on daily basis to harass staff and cut their salaries. example - you can not leave city of school / Buy electronic pen from own funds / share your location / come to school once a week etc etc.  

 

-  They do not have any defense because they had to atleast communicate about the changes in policies. 

 

-  Did you got annual bonus paid for the first year of joining ? I believe you were not paid.  so you got your answer. Ask them that they have to pay for first year bonus of 1st September 2015 along with interest. Now this become misappropriation of funds and cheating which is criminal offense. 

 

-  You can definitely send legal notice.

 

-  The problem is that after sending notice, you will not do anything.

Ankur Goel
Advocate, Bangalore
454 Answers

Dear Sir,

Employer’s internal policy clauses applies to the employee only if such rules are made known to you. You may exhaust section 12 of Industrial Disputes Act, 1947, by approaching Labor Commissioner.

Kishan Dutt Kalaskar
Advocate, Bangalore
6230 Answers
499 Consultations

1.  There's no such rule as to bonus will be paid to only those who are on the rolls, as on the date of payment of annual bonus. Hence you are entitled to get bonus for 2021-22.

2.   Management can't unilaterally, without consulting the employees, withdraw a social measure, like leave encashment. The Management can't say that since the employees were asked to work from home, this facility of leave encashment has been withdrawn. The work from home itself means that you have to put in several hours of work from home and it's not to be considered as enjoyable holidays. Hence you are entitled to leave encashment.

3.  Regarding gratuity, bonus and leave encashment, please send a letter to the management to follow the rules and release your due amount.

4.   If the management refuses to consider your request, please send a legal notice through an Advocate to resolve the matter.

Thank you sir.

Shashidhar S. Sastry
Advocate, Bangalore
5623 Answers
339 Consultations

The organisation has denied you the privileges as well as your rights of employment.

You may first ascertain about the bonus rules of the company even though you have not been intimates about it earlier  and if it is not applicable to you  then you may skip bonus and demand for leave encashment.

You issue a legal notice to your organisation demanding all your dues, let them give a reply notice through their lawyer after which you can decide to proceed legally on this. 

T Kalaiselvan
Advocate, Vellore
89977 Answers
2492 Consultations

Gratuity calculation:

The period of service of an employee is taken as a whole year for the calculation. In case the number of months worked in the last year is less than 6 months, the previous number of completed years is considered. However, if the number of months completed in the last year of service is more than 6 months, the year is considered to be a full year for the purpose of calculation. 

 

You can demand difference in gratuity settlement  amount in the same demand notice if the organisation is not making the proper settlement of gratuity. 

T Kalaiselvan
Advocate, Vellore
89977 Answers
2492 Consultations

Issue legal notice to company to pay you annual bonus and leave encashment for period of your employment 

 

if company refuses to pay sue the company to recover the money payable to you 

Ajay Sethi
Advocate, Mumbai
99775 Answers
8145 Consultations

Act as mentioned herein above 

Ajay Sethi
Advocate, Mumbai
99775 Answers
8145 Consultations

Dear Ma'am/ Sir, 

1. Working from home cannot be equated to a leave. Taking leave is a right and you were not working at home by your choice. further, the management cannot decide on such a measure without consulting all employees. You are qualified for leave encashment. 

2. You can issue a legal notice seeking recovery of arrears. you can file a suit only in the civil court. The Labour court does not have jurisdiction over this case. 

3. In the case of Gratuity, you may apply in the labour court under section 7 of the Payment of Gratuity Act, 1972.  

Thank You

  • For further assistance, you can book a consultation with me.
  •  

Anik Miu
Advocate, Bangalore
11014 Answers
125 Consultations

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