Dear Seniors,
What if someone doesn't turn up to collect the final dues or F&F within time and starts asking for final dues almost about one year later? Is the company liable to pay or can deny it? Is there any government rule in this regard? Please let me know.
Thanks! Saunee
From India, New Delhi
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13What if someone doesn't turn up to collect the final dues or F&F within time and starts asking for final dues almost about one year later? Is the company liable to pay or can deny it? Is there any government rule in this regard? Please let me know.
Thanks! Saunee
From India, New Delhi
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Hi, Saunee,
You may define a stipulated period to handle F&F cases to ease your administration and reporting. However, you are liable to pay F&F to all ex-employees. You need to work in tandem with Finance policy. All pending payable and payout cases are booked in financial reports, which are signed off every year by the CFO or as per your company's rules. These are also subject to internal and external audit reports.
As HR, you are equally responsible for keeping records, tracking, and disposing of them as per company policy and compliance. To avoid administrative hassle and set a positive example, you may take explanations in writing from such ex-employees. This will help people to treat the process with respect. Please check if his/her record exists in HR and Finance records as to be paid before you commit to the ex-employee to avoid internal issues.
Hope you are clear now.
Best wishes,
Runa
From India, Mumbai
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You may define a stipulated period to handle F&F cases to ease your administration and reporting. However, you are liable to pay F&F to all ex-employees. You need to work in tandem with Finance policy. All pending payable and payout cases are booked in financial reports, which are signed off every year by the CFO or as per your company's rules. These are also subject to internal and external audit reports.
As HR, you are equally responsible for keeping records, tracking, and disposing of them as per company policy and compliance. To avoid administrative hassle and set a positive example, you may take explanations in writing from such ex-employees. This will help people to treat the process with respect. Please check if his/her record exists in HR and Finance records as to be paid before you commit to the ex-employee to avoid internal issues.
Hope you are clear now.
Best wishes,
Runa
From India, Mumbai
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Have you informed the employee that his F&F was settled and called upon him to collect it within a stipulated time? The employer cannot wait for the employee to inquire about his F&F and come and collect. For example, the Gratuity Act requires the employer to pay gratuity within 30 days of it becoming payable. You cannot deny him his legal dues. They are his property in the hands of the company but not a bounty to be given to him as per the whim of the company. For all the delay, probably the money attracts interest also. The delay is fraught with such financial implications.
B. Saikumar HR & Labour Law Advisor Mumbai
From India, Mumbai
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B. Saikumar HR & Labour Law Advisor Mumbai
From India, Mumbai
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Dear Sai,
Thanks for the information, but it's not about the delay from the employer's side; it is from the employee's side who was informed to collect his dues but didn't turn up. His cheque got expired after six months. Now, almost after one year, he called up for the dues. Of course, his dues will be paid, but my question was if there is any policy or practice being followed by companies to handle such things or any time limit being put by companies to collect the dues within.
Please answer...
From India, New Delhi
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Thanks for the information, but it's not about the delay from the employer's side; it is from the employee's side who was informed to collect his dues but didn't turn up. His cheque got expired after six months. Now, almost after one year, he called up for the dues. Of course, his dues will be paid, but my question was if there is any policy or practice being followed by companies to handle such things or any time limit being put by companies to collect the dues within.
Please answer...
From India, New Delhi
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Dear Saunee,
Even after reminding the employee to collect the dues, if the employee is not receiving the dues within one year, the same amount cannot be retained by the company. It should be paid to the respective state labour welfare board at the end of the year. All unpaid accumulations/dues from the employer to the employee have to be paid to the Labour Welfare Fund Board.
Therefore, please send a notification to the employee instructing them to collect their dues, clearly mentioning the date. Send all letters via registered post. If the employee still does not come to collect the dues, you can then pay the same to the Labour Welfare Fund Board.
In the event that the employee approaches in the future to inquire or takes legal action, ensure that you can provide the documents promptly.
Thank you.
From India, Mumbai
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Even after reminding the employee to collect the dues, if the employee is not receiving the dues within one year, the same amount cannot be retained by the company. It should be paid to the respective state labour welfare board at the end of the year. All unpaid accumulations/dues from the employer to the employee have to be paid to the Labour Welfare Fund Board.
Therefore, please send a notification to the employee instructing them to collect their dues, clearly mentioning the date. Send all letters via registered post. If the employee still does not come to collect the dues, you can then pay the same to the Labour Welfare Fund Board.
In the event that the employee approaches in the future to inquire or takes legal action, ensure that you can provide the documents promptly.
Thank you.
From India, Mumbai
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Employee Handbook 2009 FINAL.doc