One month salary will be on hold One month salary will be on hold

2 months ago

I joined a company in November 2023. I am Leaving the company on 05th Feb 2024. at the joining, i signed a document that says my 01 month salary will be on hold till 11 months. If i leave the job before 11 months, salary will not be disbursed. What can I do

Legal Counsel Vidhikarya

Responded 2 months ago

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A.Dear Client,
It appears that your contract of employment stipulates a clause of one month's notice to be served by either party for leaving the service by an employee and for terminating the service by the employer and for breach of said condition, both the party shall compensate each other instead of notice. So, if you tendered your resignation without serving a notice period of one month, then the employer can withhold your one month's salary in lieu of notice. But your query sounds like something else " i signed a document that says my 01 month salary will be on hold till 11 months ". Such a condition itself is considered immoral and illegal too. On cessation of the relationship between an employee and employer either by resignation or otherwise, such a condition violates the provision of Section 27 of the Contract Act, 1872 which states that any terms and conditions of an agreement that directly or indirectly compels the employee to serve the employer or puts a restriction on them joining the competitor or other employer is not valid. The employee has the right to resign from the employment even if he has agreed to the employment bond to serve the employer for a specific period of time. In the case where the employer is able to prove that the employee is joining the competitor to disclose the trade secret then the court may issue an injunction order restricting the employee from joining the competitor. Further, Section 73 of the Contract Act, 1872 makes provision for unliquidated damages. Section 74 of the Act deals with liquidated damages and no compensation is attracted for mere breach of contract u/s.73. or 74 of the Act unless such breach resulted in an actual loss or damage to the opposite party employer. So, in the prevailing situation, if you are not holding the position of Manager/Supervisor but a workman as defined u/s.2(s) of the Industrial Dispute Act then after serving a legal notice to the Company, reach out to the concerned Labour Commissioner office for filing a complaint against the Company to redress your grievance over alleged arbitrary and unfair labour practice. Additionally, you can file an application under Sec.33C(2) of the I D Act before the Labour Court for recovery of your dues from the employer. However, in case you belong to the Manager or Supervisor position, then you have to file a civil suit for appropriate relief in the matter.
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Vidhi Samaadhaan Vidhi Samaadhaan

Abhimanyu Shandilya

Responded 2 months ago

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A.Dear client,

If you have signed the contract which mentioned that specific clause then you are bound to obey their decision.
But you can have a conversation with the HR regarding the same whether the company can do something regarding your 1 month salary going out of contract.

Thanks
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Kishan Dutt Kalaskar

Responded 2 months ago

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A.Dear Sir
Please approach the following authority or similar authority in a state

The Office Commissioner of Labour

Section 12 in The Industrial Disputes Act, 1947
12. Duties of conciliation officers.- (relevant section 12(2) of ID Act)

(1) Where any industrial dispute exists or is apprehended, the conciliation officer may, or where the dispute relates to a public utility service and a notice under section 22 has been given, shall hold conciliation proceedings in the prescribed manner.

(2) The conciliation officer shall, for the purpose of bringing about a settlement of the dispute, without delay, investigate the dispute and all matters affecting the merits and the right settlement thereof and may do all such things as he thinks fit for the purpose of inducing the parties to come to a fair and amicable settlement of the dispute.

(3) If a settlement of the dispute or of any of the matters in dispute is arrived at in the course of the conciliation proceedings the conciliationofficer shall send a report thereof to the appropriate Government 1 or an officer authorised in this behalf by the appropriate Government] together with a memorandum of the settlement signed by the parties to the dispute.

(4) If no such settlement is arrived at, the conciliation officer shall, as soon as practicable after the close of the investigation, send to the appropriate Government a full report setting forth the steps taken by him for ascertaining the facts and circumstances relating to the dispute and for bringing about a settlement thereof, together with a full statement of such facts and circumstances, and the reasons on account of which, in his opinion, a settlement could not be arrived at.

(5) If, on a consideration of the report referred to in sub- section (4), the appropriate Government is satisfied that there is a case for reference to a Board, 2 Labour Court, Tribunal or National Tribunal,] it may make such reference. Where the appropriate Government does not make such a reference it shall record and communicate to the parties concerned its reasons therefor.

(6) A report under this section shall be submitted within fourteen days of the commencement of the conciliation proceedings or within such shorter period as may be fixed by the appropriate Government: 3 Provided that, 4 subject to the approval of the conciliation officer,] the time for the submission of the report may be extended by such period as may be agreed upon in writing by all the parties to the dispute.]

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