Variable Pay
2 months ago
I have resigned from my company in January 2024 and have served one month notice. My last working day was February 9, 2024. My January salary was kept on hold which was supposed to be credited with a quaterly variable pay which is based on performance.
Now the company says that I am not eligible for that variable pay as I have resigned, but it was not mentioned anywhere in there policy.
What can be done in this case?
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.]
Variable pay or compensation is typically influenced by an employee's performance and the overall performance of the company. Eligibility for variable pay is often contingent on the employee being on the payroll as of the last working day (LWD) for the relevant month when the variable pay is disbursed.
In the scenario described, if the employee's LWD falls on or after December 31st (for the quarter October to December), they would be entitled to receive variable pay. This entitlement is not subject to adjustments or compromises, especially since the employee has already been released upon completion of the notice period following resignation.
To address the situation, the employee can take the following steps:
1. Serve a Legal Notice: Send a legal notice to the company, formally requesting the issuance of a relieving letter and the disbursement of full and final (F & F) dues.
2. Visit the Labour Commissioner's Office: If the matter remains unresolved, visit the office of the Labour Commissioner relevant to the jurisdiction and file a complaint against the company for unfair labor practices, seeking redress for the grievance.
3. File an Application under Sec: 33C(2) of the Industrial Dispute Act: Simultaneously, file an application under Section 33C(2) of the Industrial Dispute Act, 1947, before the State/Central Government Labour Court for the recovery of all dues receivable from the company upon resignation.
4. File a Civil Suit: If necessary, consider filing a civil suit against the company before the Civil Court to seek appropriate relief in the matter.
Taking these steps can help the employee pursue legal avenues to address the non-payment of dues and secure a resolution for their grievance.
Variable pay or compensation is determined based on two main factors – the employee's performance and the company's overall performance. An employee becomes eligible to get variable pay in terms of employment only if he is on the payroll as of LWD(last working day) for the month the quarterly variable is paid. So, if his LWD is on or after 31st Dec(for the quarter Oct to Dec), he will receive it, else not. Therefore, based on the aforesaid analysis and your performance appraisal (as stated in the query) you are eligible for variable pay from the Company and the question does not arise at all of its adjustments or compromises because you are already released on cessation of your relationship with the Company on completion of notice period post-resignation. In the given situation, you just serve a legal notice to your Company demanding the issue of a relieving letter and for disbursement of F & F dues. In case the matter is not resolved, then visit the office of the Labour Commissioner concerned to file a complaint against the Company for adopting unfair labor practices for redressal of your grievance and simultaneously file an application under Sec:33C(2) of the Industrial Dispute Act, 1947 before the State/Central Govt. Labour Court as the case may be for recovery of entire dues receivable from the Company on resignation. You may also file a civil suit against the Company before the Civil Court for appropriate relief in the matter. Reach out to an Advocate handling service matters for guidance and steps to resolve the issue in the right way.
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