Ok, so I joined this company in 2012. During the interview and signing of papers, I was told that I was being hired on contract and the only difference between me and any other employee is that I would not have a PF and medical insurance deduction. We only had a deduction of 10% TDS. We were paid a fixed "fee" every month.
After about 6-7 years of working in the company, after GST was introduced, we were asked to submit monthly invoices for tax audit purposes. Now, all the rules and regulations, all policies of the company were applicable to me. I was recruited by the head of department, asked to report to her and assigned tasks of equal nature with anyone else in the team. I was quite young back then and didn't realize that these wordings were simply abused and the recruits tactfully made to sign them, with the clandestine goal of circumventing provisions of the labor laws.
My work in the organization is as per the monthly roster prepared by the HOD for both "on rolls" staff as well as the few "on contract" staff. Often by default in a year or two the "on contract" staff simply get put on payrolls. I was even asked if I wanted to but I said that I preferred to get that formality done a year or so later because the salary I drew back then was quite less. Deductions such as PF, Diwali Bonus among others would reduce my monthly take home to significantly lower amounts.
To make it clear - I was in practice an employee with no rights to do a "come and go as I like" sort of job or do just the amount of work I chose to and demand pay only for that. Not doing a chore, just any chore or task asked of me would have led to disciplinary action against me. Therefore in practice the word "independent" was null and void.
Until recently the company did not have well-framed policies and documents that defined various entitlements and duties of employees. Only recently with a revamp in the human resources department have these documents uploaded on the intranet site. I have been using the magnetized ID card to swipe my attendance on a daily basis. I am entitled to annual pay hikes and twice I have been promoted as well. The payslip only shows "consultant fees, number of days worked, LWP days" and no other allowances. There is only a TDS deduction of 10% of the "fee".
As of now, the exit interview form says that only "on roll" employees are entitled to gratuity benefits and I would only be given the "fee" after deduction of the number of days I am unable to serve notice. Here we go. I am not even allowed to just exit at my own free will and will have to pay for the notice period not served.
About 3-4 years ago, they got all the "contract" employees to sign a letter saying they are voluntarily forfeiting their right to PF benefits. Now going by what is said in many of the threads, whatsoever the wordings of the agreement may be and slyly calling the wages as "fee" and mentioning the appointment letter that "you will always be an independent contractor and will not approach any labor court".
Now given that I have "signed" this tacitly worded letter, I see some of the forum commentators seem to be on the side of the employer, and it is causing me paranoia if the labor commissioner may have a divided opinion on this. My company is not any ordinary one; they have significant influence at top places. Makes me wonder whether this will easily be an open and shut case or will legal recourses have to be availed.
From India
4After about 6-7 years of working in the company, after GST was introduced, we were asked to submit monthly invoices for tax audit purposes. Now, all the rules and regulations, all policies of the company were applicable to me. I was recruited by the head of department, asked to report to her and assigned tasks of equal nature with anyone else in the team. I was quite young back then and didn't realize that these wordings were simply abused and the recruits tactfully made to sign them, with the clandestine goal of circumventing provisions of the labor laws.
My work in the organization is as per the monthly roster prepared by the HOD for both "on rolls" staff as well as the few "on contract" staff. Often by default in a year or two the "on contract" staff simply get put on payrolls. I was even asked if I wanted to but I said that I preferred to get that formality done a year or so later because the salary I drew back then was quite less. Deductions such as PF, Diwali Bonus among others would reduce my monthly take home to significantly lower amounts.
To make it clear - I was in practice an employee with no rights to do a "come and go as I like" sort of job or do just the amount of work I chose to and demand pay only for that. Not doing a chore, just any chore or task asked of me would have led to disciplinary action against me. Therefore in practice the word "independent" was null and void.
Until recently the company did not have well-framed policies and documents that defined various entitlements and duties of employees. Only recently with a revamp in the human resources department have these documents uploaded on the intranet site. I have been using the magnetized ID card to swipe my attendance on a daily basis. I am entitled to annual pay hikes and twice I have been promoted as well. The payslip only shows "consultant fees, number of days worked, LWP days" and no other allowances. There is only a TDS deduction of 10% of the "fee".
As of now, the exit interview form says that only "on roll" employees are entitled to gratuity benefits and I would only be given the "fee" after deduction of the number of days I am unable to serve notice. Here we go. I am not even allowed to just exit at my own free will and will have to pay for the notice period not served.
About 3-4 years ago, they got all the "contract" employees to sign a letter saying they are voluntarily forfeiting their right to PF benefits. Now going by what is said in many of the threads, whatsoever the wordings of the agreement may be and slyly calling the wages as "fee" and mentioning the appointment letter that "you will always be an independent contractor and will not approach any labor court".
Now given that I have "signed" this tacitly worded letter, I see some of the forum commentators seem to be on the side of the employer, and it is causing me paranoia if the labor commissioner may have a divided opinion on this. My company is not any ordinary one; they have significant influence at top places. Makes me wonder whether this will easily be an open and shut case or will legal recourses have to be availed.
From India
Whatever the stance of the employer, a consultant who receives a payslip detailing the total number of days worked, loss of pay, etc., is considered an employee. If the contract specifies adherence to company policies regarding timing, reporting, etc., it is deemed a contract of employment, and the compensation received is considered salary. Upon leaving after five years, gratuity should also be provided. Please review the attached case for reference. The case involves consultant doctors whose remuneration was categorized as professional charges, with the IT department asserting that the remuneration should be treated on par with salary, as they are considered employees.
From India, Kannur
From India, Kannur
Thank you so much, Madhu, sir. If I take a copy of this judgment to HR, the company is all the more likely to fight tooth and nail because acknowledging me as an employee will amount to paying up significant amounts of retrospective taxes to the government under section 192. I am not sure if that even applies because very few of the employees marked as "independent contractors" are even drawing much in comparison to Wockhardt.
From India
From India
If the Company HR is driving in the wrong direction, somebody should alert him that he is heading the wrong way, right? Either the passengers on the bus should alert him, or you should inform someone outside who can stop the bus and ask the driver why he is going in the wrong direction! This means you can alert the labor department, who will intervene in the management's incorrect actions. If you fear reprisal from management, you can utilize the official web portals of EPFO and labor departments.
From India, Kannur
From India, Kannur
From what you have narrated, it is evident that the organization has resorted to some paper arrangement to cover up the actual reality. This will stand the test of judicial scrutiny once the 'veil is lifted' and the stark reality will appear clear and vivid. There appears to be no escape from this; the only question is when this will happen and who is going to bell the cat.
Regarding your queries, this is to clarify that:
1. Even if there is a tacit contract between the company and its so-called contractors, it is illegal, and no contract can be valid if it is violative of the law.
2. Regarding the competence of Labour Commissioners (generally a senior IAS Officer) to decide on questions of law, normally these matters are dealt with by the Assistant or Deputy Labour Commissioner, who is an experienced person from the Labour Department. So, there is nothing to worry about in terms of their knowledge. Even in the worst case, if the Labour Commissioner takes it upon himself to deal with this, normally a qualified subordinate official will be helping and assisting him/her. The question of being an 'employee' or not is a complicated question of law and facts, so it will not be dealt with in a casual manner.
From India, Mumbai
Regarding your queries, this is to clarify that:
1. Even if there is a tacit contract between the company and its so-called contractors, it is illegal, and no contract can be valid if it is violative of the law.
2. Regarding the competence of Labour Commissioners (generally a senior IAS Officer) to decide on questions of law, normally these matters are dealt with by the Assistant or Deputy Labour Commissioner, who is an experienced person from the Labour Department. So, there is nothing to worry about in terms of their knowledge. Even in the worst case, if the Labour Commissioner takes it upon himself to deal with this, normally a qualified subordinate official will be helping and assisting him/her. The question of being an 'employee' or not is a complicated question of law and facts, so it will not be dealt with in a casual manner.
From India, Mumbai
@Madhu, yes, the company has a history of taking unfair action on employees over petty personal grudges. They will pick up some trivial human error, which is very commonly done by just about anyone, and blow it out of proportion to fire the employee and make them immediately leave the premises, and disable their email account so that they can't gather evidence that there have been thousands of occasions in the past when such errors were just brushed away as part of work. Given that I am on notice right now, they are highly likely to pick some random nonsense to terminate me and then claim that I am not eligible for gratuity because I was fired on disciplinary grounds. Yes, they can go that far.
@KK!HR, much appreciated. The second question was of priority because I really needed to know if there was a possibility of the company pulling some strings to get the labor office to go in their favor. As stated before, the company has influence at top levels.
From India
@KK!HR, much appreciated. The second question was of priority because I really needed to know if there was a possibility of the company pulling some strings to get the labor office to go in their favor. As stated before, the company has influence at top levels.
From India
Soon after you are relieved from your position, you should send a notice to the company demanding your gratuity. If the gratuity is not paid, you can approach the Labor Office. Once the gratuity is received, other employees can also demand it, and the company will be compelled to change the employees' status.
From India, Kannur
From India, Kannur
What Madhu T K mentioned in his last post is absolutely correct. Collect and retain all necessary documents in your possession and first seek Gratuity Payment after leaving the organization. Once that is settled, address any other issues. Avoid referencing any court cases to your employer at this time.
S K Bandyopadhyay (WB, Howrah) CEO-USD HR Solutions +91 98310 81531 skb@usdhrs.in USD HR Solutions – To strive towards excellence with effort and integrity. (http://www.usdhrs.in)
From India, New Delhi
S K Bandyopadhyay (WB, Howrah) CEO-USD HR Solutions +91 98310 81531 skb@usdhrs.in USD HR Solutions – To strive towards excellence with effort and integrity. (http://www.usdhrs.in)
From India, New Delhi
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