I, the undersigned, working as a Corporate Manager-H.R./IR at Pune. My company comes under the Shop and Establishment Act. We want a legal opinion regarding final settlement dues - when should they be paid? Can we state in the appointment letter that your full and final settlement can be completed three (3) months after your last day of service? Or can we include it in our letter of resignation acceptance? We usually provide a relieving letter, stating that "Management has accepted your resignation dated _______ and we will relieve you on _______. You may collect any dues after obtaining the necessary clearance certificate."
In that letter, can we mention that your dues will be settled three (3) months after your last working day, instead of in the appointment letter?
From India, Pune
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7In that letter, can we mention that your dues will be settled three (3) months after your last working day, instead of in the appointment letter?
From India, Pune
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All the clearances to be completed before 30 days from last day of working.
From India, Pune
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From India, Pune
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Actually, all dues should be cleared before issuing the acceptance letter, incorporating a sentence stating that this company has no outstanding financial obligations regarding your FnF. This is a good practice. Alternatively, you can provide a week of assurance. You can mention in the appointment letter, ensuring compliance with labor laws applicable to your job service at that time.
From India, Nellore
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From India, Nellore
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Dear Jayant,
Can you please mention the authority under which a 3-month period can be taken by the employer to pay the F&F settlement dues?
If you analyze the term "F&F Settlement," you will find it normally comprises the surrender value of leave at credit on the date of termination, retrenchment compensation, notice salary if applicable, gratuity if eligible, and salary or wages for the last spell of duty period, each of which has a specific period for disbursement. As far as I know, none of them has such a long duration of three months or more.
At best, as rightly observed in general by our friend Prashant, it should not exceed more than 30 days from the date of termination of employment. The only exception is the proportionate bonus for the service rendered in the Accounting Year for which if the bonus has not been declared on the date of termination.
From India, Salem
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Can you please mention the authority under which a 3-month period can be taken by the employer to pay the F&F settlement dues?
If you analyze the term "F&F Settlement," you will find it normally comprises the surrender value of leave at credit on the date of termination, retrenchment compensation, notice salary if applicable, gratuity if eligible, and salary or wages for the last spell of duty period, each of which has a specific period for disbursement. As far as I know, none of them has such a long duration of three months or more.
At best, as rightly observed in general by our friend Prashant, it should not exceed more than 30 days from the date of termination of employment. The only exception is the proportionate bonus for the service rendered in the Accounting Year for which if the bonus has not been declared on the date of termination.
From India, Salem
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Dear Nisaljayant,
It has been clear that full and final settlement of an outgoing employee has to be made immediately after collecting no dues certificates and other formalities. At the most, you can clear it in fifteen to thirty days.
In the same manner, you can give a relieving letter as mentioned by you without the content of dates for the settlement amounts, because it is the bounden duty of the employer to clear the employee's dues unless the employee is not submitting the no dues.
From India, Hyderabad
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It has been clear that full and final settlement of an outgoing employee has to be made immediately after collecting no dues certificates and other formalities. At the most, you can clear it in fifteen to thirty days.
In the same manner, you can give a relieving letter as mentioned by you without the content of dates for the settlement amounts, because it is the bounden duty of the employer to clear the employee's dues unless the employee is not submitting the no dues.
From India, Hyderabad
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To Mr. Umakanthan,
Sir,
Thank you for your prompt reply. I want to add some more information to you that ours is a partner firm. The owners are the wife and his father is a partner. If, suppose, they have passed a resolution that final dues will be paid after 3 months from the date of relieving, can we write in the resignation acceptance letter that as per company policy, we will clear your final dues within three (3) months? Is it legal? Or is there any alternative, please advise.
Jayant Nisal Corporate Manager - H.R./I.R. Email: nisaljayant@yahoo.com Phone: 7875757963
From India, Pune
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Sir,
Thank you for your prompt reply. I want to add some more information to you that ours is a partner firm. The owners are the wife and his father is a partner. If, suppose, they have passed a resolution that final dues will be paid after 3 months from the date of relieving, can we write in the resignation acceptance letter that as per company policy, we will clear your final dues within three (3) months? Is it legal? Or is there any alternative, please advise.
Jayant Nisal Corporate Manager - H.R./I.R. Email: nisaljayant@yahoo.com Phone: 7875757963
From India, Pune
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If the Shop Act is applicable to you, then all the Payments/Wages/Minimum Wages/Salary need to be paid as per the Act only.
As per your Firm/Establishment, it is owned and managed by the owners only. So, can they pass a resolution stating that "No one will get a salary in this firm?"
If the answer is NO, it means that even your Establishment needs to follow the minimum rules and regulations set by the Government. Right?
From India, Pune
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As per your Firm/Establishment, it is owned and managed by the owners only. So, can they pass a resolution stating that "No one will get a salary in this firm?"
If the answer is NO, it means that even your Establishment needs to follow the minimum rules and regulations set by the Government. Right?
From India, Pune
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Dear Jayant,
Neither the constitution of an establishment nor the social or advantageous status of its owners can confer any rights to override the provisions of the laws of the land applicable to the organization run by them. Apart from that, contracting out, i.e., agreeing not to do something specified in law, is not permitted in Indian labor laws.
From India, Salem
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Neither the constitution of an establishment nor the social or advantageous status of its owners can confer any rights to override the provisions of the laws of the land applicable to the organization run by them. Apart from that, contracting out, i.e., agreeing not to do something specified in law, is not permitted in Indian labor laws.
From India, Salem
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Dear anonymous friend,
If you try to understand the meaning of the term "manager" in the backdrop of the concept of management, I think such a question would not arise at all. To put it simply, a manager is a person responsible for running a part or the entire operations of an organization through effective utilization of the resources, including the men at his/her disposal, to achieve the overall objective for which the organization stands.
As such, it follows that the normal duties of a manager are not coterminous with the working hours of the persons under his/her control. However, it does not mean that a manager has to be on duty 24x7; he also needs time for rest, leisure, and to discharge his family and social responsibilities like any other human being.
But his prime position in the organizational hierarchy grants him the freedom to prioritize his work, and aside from that, the higher compensation package offered will also, in my opinion, naturally negate the claim for overtime by any manager, whether he belongs to the top, middle, or supervisory level.
From India, Salem
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If you try to understand the meaning of the term "manager" in the backdrop of the concept of management, I think such a question would not arise at all. To put it simply, a manager is a person responsible for running a part or the entire operations of an organization through effective utilization of the resources, including the men at his/her disposal, to achieve the overall objective for which the organization stands.
As such, it follows that the normal duties of a manager are not coterminous with the working hours of the persons under his/her control. However, it does not mean that a manager has to be on duty 24x7; he also needs time for rest, leisure, and to discharge his family and social responsibilities like any other human being.
But his prime position in the organizational hierarchy grants him the freedom to prioritize his work, and aside from that, the higher compensation package offered will also, in my opinion, naturally negate the claim for overtime by any manager, whether he belongs to the top, middle, or supervisory level.
From India, Salem
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