My brother was hired in a startup in mid-Jan 2023. The company started its operations in Jan 2020. He was hired as a consultant in the design team. I write on his behalf. The company started delaying salaries in Jan itself, saying there are some issues but will pay in the next week and so on. Weeks kept going by and reasons kept hanging. Finally, some time in March, salary for Jan was paid saying we'll pay the salary for Feb and March together. All this was verbal communication. It has been May now, no salary is paid after that. After talking to the team head multiple times and getting fed-up, we dropped a mail to the co-founder & CEO, asking to clear the dues and that we'll move legally and on social media, if not. Rather than being apologetic, he expressed shock at how an employee could email him. That he has mentioned since Dec 2022 that company is facing problems and that no one forced you to stick around. If there were problems in Dec itself, why was my brother hired in Jan is the first question. Next he also says that you are hired on a contractual consulting basis and not as an employee. What does that have to do with anything? Can I not claim my dues in such a case? Lastly, he also says that the company's revenue plan and funding was impacted due to not meeting market deliverables. That is the issue with the execution on his part, right? How is the junior employee responsible for that? He also says that he has permitted moonlighting options. I mean, because you don't pay my dues, I have to go and do another job so that I can pay my rent? What is this even. I seek suggestions on how to tackle this and get my rightfully owed money. Is being on a contract-consulting basis a problem? The offer letter does not state anything as such. Can I move labor court? What other remedies can I seek? Is there a chance I would even get my money? I moved to BLR, have been paying rent and incurring all expenses with barely 15 days of salary received. I am fed up of this and now the attitude shown by the CEO
It was not advisable for you to continue to be employed even as a contractual consultant when the company failed to make payments every month.
Non payment of monthly salary is breach of contract hence you can terminate the contract immediately and seek for payment of your dues by issuing a legal notice to the employer.
Even now you engage an advocate, issue legal notice and then file a suit for recovery of your dues.
Issue legal notice to company to pay your outstanding salary
2) if company fails to pay take legal proceedings against company to recover salary dues with interest
First send them a legal notice for payment of due salaries. If not replied, then approach the jurisdictional labour commissioner office by filling a complaint therein . If the start up is coming under central government industries then approach central government labour commissioner otherwise state labour commissioner for other industries. If the dispute is not solved there you can move to labour court.
Being consultant you donot fall within the definition of labour. Secondly you are not the employee of the company so you cannot approach labour court. You are not the labour. Get issue legal notice demanding clearance of pending dues with interest and if notice is not complied then file suit for recovery.
Hi, First you have to issue a legal Notice demanding your employer to repay the amount and If they does not paid the amount then file a suit for recovery of money.
Thanks all, My next question is: I'm sure the CEO / Founder would not respond to the legal notice, in which case I'll file a suit for recovery of money. How long does it take for recovery? Is recovery usually done? The amount is ~2 lac. Does it make sense to run behind the case for this money, make all lawyer payments and other payments? Would the cost and time spent for recovery make sense, given what the amount is? Lastly, there is a case on the CEO that I just saw. Does this have any voice against the CEO? : https://indiankanoon.org/doc/135017805/?type=print
Litigation is long drawn and expensive proposition
2) disposal of case would depend upon pendency of cases in your city
3) legal fees vary depending upon lawyer engaged by you
4) for recovery of Rs 2 lakhs it does not make sense in going to court
You cannot ensure the steps to be taken or not to be taken by opposite party so do and concentrate on your required work only without bothering for opposite party. If you file suit for recovery then it may take 2 to 3 years time in deciding of the case. If you file case, then you can also get interest, cost of suit including court fees and also cost on account of payment to lawyer on account of fee etc. No other case against CEO would effect your case. Your case would be sgainst company and nit CEO.
The legal avenues or options were advised to you.
No doubt a money recovery suit may take its own time for disposal and you may have to bear the litigation expense besides paying lawyer's fee.
But that cannot be an excuse for you to abandon your hard earned money that is due to you from the company.
Whether the CEO will respond to the legal notice or not, it is mandatory for you to issue a legal notice subsequent to which you can file a money recovery suit.
It is for you to decide based on the circumstances prevailing at your end.
- Since, your brother has signed the offer letter of the said company , then legally he having his right to get the salary every month which is mentioned in the offer letter
- Further, the employer cannot refuse to pay the same on any ground. and the said company is under legal obligation to pay the entire arrears of salary to your brother.
- Hence , your brother should send a legal notice to the said company for getting the same , and if no positive response , then he can file a recovery suit before the court , and also can lodge his compliant before the labour court.
- The founder CEO is bound to response the legal notice
- The recovery suit depends upon the burden of the court , and can be recovered after filing the suit before the court.
It takes time for a suit in civil court but you can seek some interim reliefs or injunction depending on merits of your case
Dear Sir,
Please approach the following authority or similar authority in a state
The Office Commissioner of Labour
Karmika Bhavan, Dairy Circle,
Bannerghatta Road, Bangalore-29.
[deleted]
[deleted]
Addresses of Labor Inspectors in Bengaluru in different locations
https://karmikaspandana.karnataka.gov.in/page/Contact+Us/Labour+Inspector/en
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Section 12 in The Industrial Disputes Act, 1947
(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.]
Dear client,
Review the employment agreement or offer letter: Carefully review the terms of the employment agreement or offer letter your brother received. Pay attention to any clauses related to payment, termination, or dispute resolution. This will help you understand the contractual obligations of both parties.
Document all communications: Keep a record of all verbal and written communications with the company, including emails, text messages, and any promises made regarding salary payment. This documentation can be important evidence if legal action is necessary.
Send a formal written demand letter: Draft a formal written letter to the company, specifically addressing the CEO or relevant authority, detailing the outstanding salary, dates of non-payment, and any previous attempts to resolve the issue. Clearly state that legal action will be pursued if the dues are not paid within a specified deadline.
Consult an employment lawyer: Seek advice from an employment lawyer who specializes in labor and employment laws in your jurisdiction. They can review your case and provide guidance on the best course of action. They may advise you on filing a complaint with the labor authorities or pursuing legal action, such as filing a claim in the labor court or small claims court, depending on the amount owed.
Explore alternative dispute resolution: Before taking legal action, consider alternative dispute resolution methods such as mediation or arbitration. These processes can help resolve the dispute without going to court, potentially saving time and costs.
Report to labor authorities: If applicable, report the non-payment of salaries to the labor authorities or relevant government agency in your jurisdiction. They may be able to assist in resolving the dispute or provide guidance on further steps to take.
Remember, labor laws vary by jurisdiction, so it's important to consult with a local employment lawyer who can provide advice based on the specific laws and regulations in your area. They can evaluate the details of your case and provide guidance on the best legal options available to you.
