My company is ruthless in cutting and holding back salaries of employees who do not achieve 100% targets month on month .Is it permitted and are there any legal obligations attached to this kind of behavior.
From India, Bangalore
From India, Bangalore
it depends on the service rules drafted by your company..if in the employment agreement it is stated that , the full salary is subject-able to acheivemnt of vested targets on individual, then its fair enough from the part of employer, but everything should be as per agreement of employment between employee and employer.
From India, Calcutta
112From India, Calcutta
Dear Surender K,
"Forfeiture of Salaries and Wages" is a punishment awarded to employee. However, this punishment is awarded only after conducting domestic enquiry . Month after month if the you cannot go on forfeiting the salary of the employees.
Secondly, any deductions made from the employees salary have to be deposited to Labour Welfare Fund (Karnataka State Labour Welfare Fund for the state of Karnataka). Are you doing that?
If Labour Officer checks the salary rolls of the employees, how will you justify the deductions without enquiry? How will you justify not depositing the deducted amount to LWF?
For this, I recommend you revising the salary structure of the employees. Keep one component as fixed pay. Employee will get this even if he/she does not attain any target. Let other component be incentive. This incentive amount be linked to the targets. Though I recommend you this, I doubt whether it holds the scrutiny of the law. I recommend you checking provisions of Payment of Wages Act. In addition to this, you may check provisions of Factory Act or Shops and Establishment Act as applicable to your company.
Ok...
Dinesh V Divekar
From India, Bangalore
"Forfeiture of Salaries and Wages" is a punishment awarded to employee. However, this punishment is awarded only after conducting domestic enquiry . Month after month if the you cannot go on forfeiting the salary of the employees.
Secondly, any deductions made from the employees salary have to be deposited to Labour Welfare Fund (Karnataka State Labour Welfare Fund for the state of Karnataka). Are you doing that?
If Labour Officer checks the salary rolls of the employees, how will you justify the deductions without enquiry? How will you justify not depositing the deducted amount to LWF?
For this, I recommend you revising the salary structure of the employees. Keep one component as fixed pay. Employee will get this even if he/she does not attain any target. Let other component be incentive. This incentive amount be linked to the targets. Though I recommend you this, I doubt whether it holds the scrutiny of the law. I recommend you checking provisions of Payment of Wages Act. In addition to this, you may check provisions of Factory Act or Shops and Establishment Act as applicable to your company.
Ok...
Dinesh V Divekar
From India, Bangalore
Holding back the full salary of any employee is not advisable.... As per payment of wages act your are supposed to deduct oly 50% of the salary on what ever basis it may.
And moreover no employment agreement support such type of behavior.......
From India, Coimbatore
And moreover no employment agreement support such type of behavior.......
From India, Coimbatore
Salary is the right claim of the employee. The employer cannot hold back the salary for any month. It is an offence and punishable. If the employee takes up the matter with the Labour office then it will become serious. Please advise your company not to do such practice.
If the company wants to be strict with the target then they can fix a salary separately and incentive for the achievement. If the taget is not achieved then they can hold back the incentive. On any account they cannot hold back the salary.
From India, Madras
If the company wants to be strict with the target then they can fix a salary separately and incentive for the achievement. If the taget is not achieved then they can hold back the incentive. On any account they cannot hold back the salary.
From India, Madras
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