Hi All,
Just want to understand if any company may deduct any amount from fixed salary for non performance or any other reason. To be specific, director of our company mailed us in the middle of last month that our salaries would be deducted if we don't get a specified target. Please suggest if any employer can get away with this when appointment/ increment letter states about a certain fixed salary per month.
Regards
A
From India, Hyderabad
Just want to understand if any company may deduct any amount from fixed salary for non performance or any other reason. To be specific, director of our company mailed us in the middle of last month that our salaries would be deducted if we don't get a specified target. Please suggest if any employer can get away with this when appointment/ increment letter states about a certain fixed salary per month.
Regards
A
From India, Hyderabad
If there is any clause regarding Performance Besed Allowance / Incentive in your salary component then your company may reduce that Salary Component at Company’s Discretion.
From India, Pune
467From India, Pune
I don't think performance based deductions are allowed from fixed components...
We divide salary as fixed and variable... so that variable is given based on performance of the employee so that if he performs the best, he gets 100% variable and if he don't perform, he gets 0% or gets it to the % of work / target achieved by them....
Many companies set a target as milestone and higher the milestone achieved by a person, higher the incentives bagged by him....
Unless your appointment letter states - Performance based pay
and adds it to your salary declared, they can deduct the said amount (as per the ratio they communicated) from your salary...
Hope this cleared your doubts...
Awaiting more replies and clarifications from Seniors.
From India, Mumbai
We divide salary as fixed and variable... so that variable is given based on performance of the employee so that if he performs the best, he gets 100% variable and if he don't perform, he gets 0% or gets it to the % of work / target achieved by them....
Many companies set a target as milestone and higher the milestone achieved by a person, higher the incentives bagged by him....
Unless your appointment letter states - Performance based pay
and adds it to your salary declared, they can deduct the said amount (as per the ratio they communicated) from your salary...
Hope this cleared your doubts...
Awaiting more replies and clarifications from Seniors.
From India, Mumbai
Thanks for response.
The amount is deducted from my fixed salary and not from variable component. And like I said earlier that in the middle of last month a mailer came to all Sales Team from Director that half of our salary will be deducted if we don't achieve a certain target. They actually did it as well.
1) In this situation I am left with no option but to resign but how will I justify this deduction to my next employer?
2) There is a notice period of 2 months and I have learnt that even after it's mentioned in appointment that that F&F should be done by 45 days, they never do it in time and always deduct some amount or other once they do it and that too after many follow ups.
Can any company get away with such deductions and they have done such things with others in the past too? Don't they come under any rules/guidelines and as an employee can't we do anything and just remain helpless?
From India, Hyderabad
The amount is deducted from my fixed salary and not from variable component. And like I said earlier that in the middle of last month a mailer came to all Sales Team from Director that half of our salary will be deducted if we don't achieve a certain target. They actually did it as well.
1) In this situation I am left with no option but to resign but how will I justify this deduction to my next employer?
2) There is a notice period of 2 months and I have learnt that even after it's mentioned in appointment that that F&F should be done by 45 days, they never do it in time and always deduct some amount or other once they do it and that too after many follow ups.
Can any company get away with such deductions and they have done such things with others in the past too? Don't they come under any rules/guidelines and as an employee can't we do anything and just remain helpless?
From India, Hyderabad
Dear petitioner,
It seems you're working for some small enterprise / private firms which are very money oriented...
I do understand that when a firm is newly established, it becomes difficult to pay salary (manage money outflow) when there's no inflow / income. However, whatever they're doing is not justified...
As I mentioned if they are deducting whatever amount from the declared/prescribed variable pay or performace linked pay, it was nothing questionable, but here you can question on what grounds have they deducted the salary.
Secondly you mentioned that they communicated this over an email... I am assuming that They did not put it up on the notice board...
Can you share the components of your salary as mentioned in your appointment letteR??
Next do you get salary slips for you salary? If you don't get one, seek one. Kindly note that increasingly firms are practising to deposit the salary directly into bank account so that employees don't have to carry hassles of going to bank to deposit cash/cheque....
However, this don't give them the right to discount on the salary slip... You can demand and they are liable to provide you with salary slips...
Once you get salary slip, kindly mention the salary components mentioned in the slip as well and if deductions are mentioned in the SS, under what headings....
From India, Mumbai
It seems you're working for some small enterprise / private firms which are very money oriented...
I do understand that when a firm is newly established, it becomes difficult to pay salary (manage money outflow) when there's no inflow / income. However, whatever they're doing is not justified...
As I mentioned if they are deducting whatever amount from the declared/prescribed variable pay or performace linked pay, it was nothing questionable, but here you can question on what grounds have they deducted the salary.
Secondly you mentioned that they communicated this over an email... I am assuming that They did not put it up on the notice board...
Can you share the components of your salary as mentioned in your appointment letteR??
Next do you get salary slips for you salary? If you don't get one, seek one. Kindly note that increasingly firms are practising to deposit the salary directly into bank account so that employees don't have to carry hassles of going to bank to deposit cash/cheque....
However, this don't give them the right to discount on the salary slip... You can demand and they are liable to provide you with salary slips...
Once you get salary slip, kindly mention the salary components mentioned in the slip as well and if deductions are mentioned in the SS, under what headings....
From India, Mumbai
Dear All/Ma'am,
Thanks for your response. I am awaiting my salary slip. I will share the details mentioned in my appointment letter alongwith the salary slip details. Meanwhile, I am enclosing below the details of mail exchanges for your perusal. I have replaced names with designations for obvious reasons. Would be grateful if you let me know if I am following right approach and is there any input for me
RE: Regarding Salary
Director
Sent: Thursday, August 08, 2013 12:22 PM
To:
Me
Cc:
Human Resource
Dear _
I am in meetings most day today. We can talk tomorrow on this.
Regards,
Director
-----Original Message-----
From: Me
Sent: Thursday, 08 August, 2013 11:40 AM
To: Director
Cc: Human Resource
Subject: RE: Regarding Salary
Dear Sir,
As you know that I've got only half of my salary this month. Would like to
bring in your kind attention that it is way too less for me to support my
liabilities. This deduction has hit me more badly since I could not get my
salary for 50 days due to my eye operation.
I have not got my conveyance reimbursement as well and that of this month
is also due. Now if I have to go in the field everyday that also need funds.
Moreover, I also have a concern if the deducted part of my salary has been
put on hold as it's my fixed salary and not variable.
As you know that I have to put in more efforts this time to achieve my
targets and focus more on getting there instead of diverting my mind with
any other issues but unfortunately this deduction has disturbed me immensely
esp. when my mind is struggling to find how I will meet my liabilities
instead of focusing on my work.
I wanted to discuss this with you on phone and sent you an sms as well but
could not get response from you.I am writing this in fever but since I am
getting very anxious, I could not wait.
You have always guided me through, would appreciate your support in getting
me through this phase.
Regards
Me
________________________________________
From: HR Executive
Sent: Wednesday, August 07, 2013 5:55 PM
To: Me
Cc: Director; Human Resource
Subject: RE: Regarding Salary
Dear __,
As per the attached mail and Director sir's instructions, we have deducted 50%
of your salary as you have not met the targets.
Have written to sir about your conveyance reimbursement.
Regards,
HR-Executive
From: Me
Sent: Wednesday, August 07, 2013 4:22 PM
To: Human Resource
Cc: Director
Subject: Regarding Salary
Dear HR Executive,
Please let me know the details of my salary this month as I am taken aback
by the amount credited to my account. There is some mistake or calculation
error as I have got just Rs. 19194.
Also please let me know the status of my conveyance reimbursement as it's
also getting postponed week after week.
Looking forward to hear from you soon as it's really getting critical for
me.
Regards,
Me
From India, Hyderabad
Thanks for your response. I am awaiting my salary slip. I will share the details mentioned in my appointment letter alongwith the salary slip details. Meanwhile, I am enclosing below the details of mail exchanges for your perusal. I have replaced names with designations for obvious reasons. Would be grateful if you let me know if I am following right approach and is there any input for me
RE: Regarding Salary
Director
Sent: Thursday, August 08, 2013 12:22 PM
To:
Me
Cc:
Human Resource
Dear _
I am in meetings most day today. We can talk tomorrow on this.
Regards,
Director
-----Original Message-----
From: Me
Sent: Thursday, 08 August, 2013 11:40 AM
To: Director
Cc: Human Resource
Subject: RE: Regarding Salary
Dear Sir,
As you know that I've got only half of my salary this month. Would like to
bring in your kind attention that it is way too less for me to support my
liabilities. This deduction has hit me more badly since I could not get my
salary for 50 days due to my eye operation.
I have not got my conveyance reimbursement as well and that of this month
is also due. Now if I have to go in the field everyday that also need funds.
Moreover, I also have a concern if the deducted part of my salary has been
put on hold as it's my fixed salary and not variable.
As you know that I have to put in more efforts this time to achieve my
targets and focus more on getting there instead of diverting my mind with
any other issues but unfortunately this deduction has disturbed me immensely
esp. when my mind is struggling to find how I will meet my liabilities
instead of focusing on my work.
I wanted to discuss this with you on phone and sent you an sms as well but
could not get response from you.I am writing this in fever but since I am
getting very anxious, I could not wait.
You have always guided me through, would appreciate your support in getting
me through this phase.
Regards
Me
________________________________________
From: HR Executive
Sent: Wednesday, August 07, 2013 5:55 PM
To: Me
Cc: Director; Human Resource
Subject: RE: Regarding Salary
Dear __,
As per the attached mail and Director sir's instructions, we have deducted 50%
of your salary as you have not met the targets.
Have written to sir about your conveyance reimbursement.
Regards,
HR-Executive
From: Me
Sent: Wednesday, August 07, 2013 4:22 PM
To: Human Resource
Cc: Director
Subject: Regarding Salary
Dear HR Executive,
Please let me know the details of my salary this month as I am taken aback
by the amount credited to my account. There is some mistake or calculation
error as I have got just Rs. 19194.
Also please let me know the status of my conveyance reimbursement as it's
also getting postponed week after week.
Looking forward to hear from you soon as it's really getting critical for
me.
Regards,
Me
From India, Hyderabad
Did they mention how much of the salary will be deducted if you will not be able to meet the target?
Was the conversation on salary deduction made prior to deduction of salary or after that?
If they did so after deducting your salary, they cannot use this excuse to justify their deeds.
If at all they wish to practice this, we can seek clarifications from them...
As requested earlier, kindly share details on Salary Slip as well as Appointment letter regarding your salary components and deduction headings if any.
Along with this, kindly mail the email draft they sent you regarding the communication on salary deduction on not meeting targets...
From India, Mumbai
Was the conversation on salary deduction made prior to deduction of salary or after that?
If they did so after deducting your salary, they cannot use this excuse to justify their deeds.
If at all they wish to practice this, we can seek clarifications from them...
As requested earlier, kindly share details on Salary Slip as well as Appointment letter regarding your salary components and deduction headings if any.
Along with this, kindly mail the email draft they sent you regarding the communication on salary deduction on not meeting targets...
From India, Mumbai
Dear Ma'am,
Thanks for your response.I have not got salary slip so far for this month. Plz find below the details of my salary as per my appointment Letter
Basic-21000
HRA-14700
Conveyance-4200
Medical Allow-2100
CTC P.M.-42000
Less Prof. Tax-200
Net Salary P.M.-Rs. 41800
Now after increment My Net Salary PM is Rs.44100.Our Director sent the following mail last month.I did not respond as I am based out of a different city and generally I get a time slot for reviews
RE: Meeting
Director
Sent: Friday, July 05, 2013 7:29 PM
To:
Director
Cc:
Human Resource
Dear Wonderful Sales Team,
None of you, except one Sales Manager X has shown any interest in discussing your work.
You dont seem interested! Pathetic!!! No calls, no emails – nothing to discuss your work!
Well, maybe you are super confident of achieving your targets this month, which is great! For those of you (except Sales Manager X) who don’t meet the minimum target this month (as indicated in the incentive plan shared), you will only get 50% of your wages this month, if you fall short.
So good luck.
HR Manager
Please implement this.
Regards,
Director
From: Director
Sent: Monday, 01 July, 2013 7:43 PM
To: Director
Subject: Meeting
Dear All,
Meet me individually tomorrow, to discuss the previous month and the plan for this month.
Regards,
Director
From India, Hyderabad
Thanks for your response.I have not got salary slip so far for this month. Plz find below the details of my salary as per my appointment Letter
Basic-21000
HRA-14700
Conveyance-4200
Medical Allow-2100
CTC P.M.-42000
Less Prof. Tax-200
Net Salary P.M.-Rs. 41800
Now after increment My Net Salary PM is Rs.44100.Our Director sent the following mail last month.I did not respond as I am based out of a different city and generally I get a time slot for reviews
RE: Meeting
Director
Sent: Friday, July 05, 2013 7:29 PM
To:
Director
Cc:
Human Resource
Dear Wonderful Sales Team,
None of you, except one Sales Manager X has shown any interest in discussing your work.
You dont seem interested! Pathetic!!! No calls, no emails – nothing to discuss your work!
Well, maybe you are super confident of achieving your targets this month, which is great! For those of you (except Sales Manager X) who don’t meet the minimum target this month (as indicated in the incentive plan shared), you will only get 50% of your wages this month, if you fall short.
So good luck.
HR Manager
Please implement this.
Regards,
Director
From: Director
Sent: Monday, 01 July, 2013 7:43 PM
To: Director
Subject: Meeting
Dear All,
Meet me individually tomorrow, to discuss the previous month and the plan for this month.
Regards,
Director
From India, Hyderabad
Ok...
Since the latest email from your Director says he's in meeting, we'll give some time... He said in an email today that he'll talk to you about this tom... However I am afraid all he needs is time to pass.... Tom is id and many companies are having holiday (Unsure if you too have) and if you have sat and sun off.... You have an extended weekend and he won't be available to you until monday...
The last msg from director stating he's in meeting was at 12.22, so you can do one thing. at around 3.30 send another email to HR and CC to Director that -
My appointment letter states my salary is ______ and I have got an increment on DATE and my revised salary is __________ w.e.f from MONTH.
The components of the salary are as mentioned below:
Basic
HRA
Conveyance
Medical Allow-
Also note that the Conveyance Allowance is unpaid to me since _____ which makes it difficult for me to meet my ends.
Apart would like to bring to your notice that my appointment letter do not state that my salary will be linked to performance and that there would be payments depending on whether or not targets are achieved.
I do understand that the company can modify and amend rules from time to time, however that cannot be merely communicated over email.
If the rules are modified, I would like the Company to intimate me about this. I do realize that I was intimated about this over email dated 5th July, However, in order to make it more formal, I would request the concerned authorities to print such clauses over company's letter head and have bear concerned authority's signature and stamp with date and mentioning from when the new clause is applicable.
If in case the concerned authority is unable to put it formally on company's paper, I would request to release my pay as is due to me and is promised to me on appointment letter and later revised as communicated via increment letter.
Regards,
_________
And don't just email this, take a print of this and make a duplicate of it as well.
Submit the original to HR and take acknowledgement on duplicate for reference.
Keep updated.
From India, Mumbai
Since the latest email from your Director says he's in meeting, we'll give some time... He said in an email today that he'll talk to you about this tom... However I am afraid all he needs is time to pass.... Tom is id and many companies are having holiday (Unsure if you too have) and if you have sat and sun off.... You have an extended weekend and he won't be available to you until monday...
The last msg from director stating he's in meeting was at 12.22, so you can do one thing. at around 3.30 send another email to HR and CC to Director that -
My appointment letter states my salary is ______ and I have got an increment on DATE and my revised salary is __________ w.e.f from MONTH.
The components of the salary are as mentioned below:
Basic
HRA
Conveyance
Medical Allow-
Also note that the Conveyance Allowance is unpaid to me since _____ which makes it difficult for me to meet my ends.
Apart would like to bring to your notice that my appointment letter do not state that my salary will be linked to performance and that there would be payments depending on whether or not targets are achieved.
I do understand that the company can modify and amend rules from time to time, however that cannot be merely communicated over email.
If the rules are modified, I would like the Company to intimate me about this. I do realize that I was intimated about this over email dated 5th July, However, in order to make it more formal, I would request the concerned authorities to print such clauses over company's letter head and have bear concerned authority's signature and stamp with date and mentioning from when the new clause is applicable.
If in case the concerned authority is unable to put it formally on company's paper, I would request to release my pay as is due to me and is promised to me on appointment letter and later revised as communicated via increment letter.
Regards,
_________
And don't just email this, take a print of this and make a duplicate of it as well.
Submit the original to HR and take acknowledgement on duplicate for reference.
Keep updated.
From India, Mumbai
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