What if Employer does not pay salary on time?

Employers denying the salary to the Employees is a very common issue in India and Employees in this regard want to avoid court cases. However, there are multiple resources available to the Employees, but the knowledge regarding the same is not easily accessible.

The first and foremost step is to issue legal notice to the Employer through some experienced and credible lawyer. This whole process is governed by the “Payment of Wages Act” though it is not applicable to every level employee.

Payment of Wages Act is applicable on the employees earning 18,000/- (Rupees Eighteen Thousand) per month and employees who are earning less than this are governed by various other laws.

Other Governing Laws

• When an employee is working in an establishment with a wage not more than one thousand, the same shall be paid before the expiry of the seventh day of the next month.  
• An employee with the wages of more than 1,000/- shall be paid before the expiry of the tenth day of next month.
• In the event an employee is terminated by the employer the wages for the same shall be paid prior to the expiry of the second working day from the day employment was terminated.

Labour Commission

In the event of Employer not paying the salary of the Employee, you always have the right to approach the Labour Commissioner. They will help you to reconcile and reach out to an amicable solution and if no solution is worked out, you can go to the court and file a case.

Industrial Dispute Act

A suit for recovery can be filed under Section 33( C) of Industrial Dispute Act against the Employer by the Employee.

Employees Earning More Than 18,000/-

In the event you are a manager or earning a higher salary and it has not been paid by the employer, the employee can file a civil suit under Order 37 of CPC and it is finalised within a very short span of time and such suits are called Summary Suits.

Punishment for Employer

• Punishment of Fraud is mentioned in section 447 of Companies Act 2013.
• An imprisonment for not less than 6 months and  which may extend to 10 years.
• Fine equal to the amount involved in fraud which may extend upto three times of the fraud amount.
• Section 447 of Companies Act defines the further process of punishment.
• Criminal case can be filed against the Company under various sections of the Indian Penal Code.

Lead India has a panel of lawyers with whom you can ask a free legal question regarding your problem and get the legal advice from them. We can guide you very well about your case in this matter so feel free to reach out to Lead India for discussing your query.