How to solve Salary issues in India

How to solve Salary issues in India

Date : 02 Mar, 2020

Post By Adv. Munish Malik

The major issue which the employees in India face is the non-payment of salaries on time by their employer. The delay or the absolute refusal to pay the salary by the employer is a  commonly occurring event in many organizations. What adds to this misery of the employees is the lack of knowledge with respect to the legal rights and recourses such an employee is entitled to. Due to this absolute helplessness and cluelessness, the employees in such arbitrary occasions are denied of their hard-earned money. 

The employers continue to exploit and deny its employees the right to the wages which they have rightfully earned because it is a common belief that the employee has limited legal remedies or recourse against these unfair acts. However, reality stands completely differently. An employee suffering from such exploitation by its employer can seek legal remedies both under civil law as well as the labor laws in our country.


The first and the foremost step towards any legal proceeding is sending a well-drafted legal notice from a credible and reputed lawyer. Hence the first step towards recovering the unpaid salary or wages is sending a stringent legal notice which shall give a fair warning to the employer to get in line and oblige to his duty to pay the employees or face the repercussions. 

Other than legal notice the following are the statutes which protect the rights of the wronged employee or worker

1. The Payment of Wages Act, 1936

India has one entire legislation to ensure timely payment of wages to workmen employed in factories, industries, and other organizations as per the provisions of the Act. The Act ensures payment of wages to workmen generally employed as skilled or unskilled laborers. 

As per the notification by the appropriate government on 29 August 2017, the wage ceiling under the act has been increased from INR 18,000 per month to INR 24,000 per month thus widening the scope and ambit of the applicability of the Act.


The workmen and the employer falling under the ambit of the payment of wages act, can as a remedy approach the labor commission whereby a settlement shall be aspired to be achieved between the employer and the employee by the labor commissioner.

In case of failure of such conciliation proceeding, a case shall be filed against the employer in the appropriate court of law and judicial proceedings shall be initiated against such defaulter employer.

Industrial Disputes Act, 1947

An employee suffering from non-payment of salary or wages which falls under the ambit of the industrial disputes Act as per the provisions of section 2(j) of the  Act can file a case in the appropriate court of law under the section 33 (c) for recovery of money due from the employer.

When the employee suffers from non-payment of his rightful salary he or any person authorized on his behalf in writing can file a suit for recovery of such unpaid salary.

Recovery Suit under Order XXXVII of the Code Of Civil Procedure, 1908

The procedure for recovery suit or summary suit under order XXXVII of the code of civil procedure,1908 is comparatively less time consuming as compared to the conventional civil suits. 

However, filing of a recovery suit should be exhausted as the last resort as most of the matters pertaining to non-payment of the salary can be easily tackled through a simple legal notice and other meditation techniques.

According to section 33 (c) (2) of the industrial disputes act, all the disputes which are filed before the labor court have to be decided within a time period of three months, failing which the labor commissioner has to record the reasons for such delay in writing.

Companies Act,2013

Where it is ascertained that the company is not paying the employee with a malicious intent of fraud, dishonesty and cheating a case under section 447 of the Companies Act, 2013 can be filed against the company according to which the person shall be liable to be a fine three times the amount of fraud and/or imprisonment which shall not be less than a period of six months. 

Further, a case of criminal breach of trust, fraud, and cheating can also be filed against such a Company under the relevant sections of the Indian Penal Code, 1980 with the police.


In a nutshell, it can be concluded that there are numerous ways to reinforce one’s right to the timely payment of salaries and wages through both civil and criminal legal proceedings. However, it is pertinent to note that most of these recovery cases can be easily tackled through a well-drafted and effective legal notice to ensure that the employer does not take the issue of non-payment for granted. 

Therefore step one shall be sending a legal notice if in any case, it is ineffective labor courts can be approached or a criminal case can be filed or one can opt for a recovery suit as discussed above. 

It is crucial to remember that the only reason the employer takes these issues of the employee for granted is because of the lack of confidence, awareness, and knowledge of one’s rights as an employee, it takes only one affirmative step towards realizing one’s legal rights and the rest automatically follows.

The author of this blog is Adv. Munish Malik having an experience of 5 years in handling Employment related matters from his experience he wants to share this beneficial information for the individuals having any issues with respect to employment related matters.

Comment on Blog

× Thank You For Commenting

Get Free Response