Query - I was working
with a software company for 3 years. I resigned the company 8 months ago. I
received the relieving letter and experience letter. The HR told me that full
and final settlement would be done after 2 months according to company policy.
But it's almost 8 months and no settlement has been done. They say full and
final settlements of previous employees are still pending and they will be
considered first. Every time the HR gives some funny reason as if it's my
concern that the previous cases are pending. Can I send a notice to the company
legally? Is the company ignoring any law by delaying the FNF settlement?
Reply
Withholding
of terminal benefits (payments due at the time of full and final settlement) by
the company (employer) is illegal as well as unjustified. In case of delay, an
employee can legally claim an appropriate interest upon the delayed payments.
It may be noted that there can be no such “policy” in terms of which the
company can withhold your terminal benefits even for 2 months. In case any such
“policy” exists, then that “policy” by itself is illegal and unenforceable in
law. It may further be noted that pendency of clearance of payments of previous
employees is no reason, much less a valid reason, to withhold your payments to
which you are legally entitled
too. You can, therefore, take a legal action against the company by sending a legal notice through a lawyer followed by
a civil suit for recovery.
You
may also like to know that Hon’ble Supreme Court of India in catena of cases
has repeatedly emphasized the position that terminal benefits are no longer
matters of any bounty to be distributed by an employer. Terminal benefits are
valuable rights acquired by an employee and are, in fact, property in the hands
of an employer. It has also been repeatedly held by the Hon’ble Courts that any
delay in settlement and disbursement thereof has to be viewed seriously and
dealt with severely by imposing penalty in the form of payment of interest.
[For your reading - State of Kerala vs M. Padmanabhan Nair [(1985) I LLJ 530
SC]
Hope
the query stands satisfied. For any further clarification / query please call /
contact the undersigned.
Thanks &
regards,
Anuj Aggarwal
Advocate
Mob - 9891403206
Website – www.advocateanujaggarwal.com
