Dear All,
Can you please tell me if a person who leaves the company (a restaurant chain in this case) and wishes to get his PLs (Earned leaves/ priviliged leaves) adjusted against his notice period, is entitled to service Charge (S.C. is the variable amount and is given to the staff as an incentive on the amount of sale)
He didn't take the PLs but wanted it to get adjusted against the notice period of 30 days and his HOD agreed to it......However, my question now is that His salary for the last month needs to be processed, and though he would have only got Basic pay for the no. of PLs he had in his account in case of PL encashment, company is ready to pay him his full (gross) salary BUT the employee wants the complete salary along with the Service Charge!!
Could you please let me know what would be right course of action in this case? Is company liable to pay him the S. C. amount since he didn't come to work even for a single day during that month....
From India, Delhi
1Can you please tell me if a person who leaves the company (a restaurant chain in this case) and wishes to get his PLs (Earned leaves/ priviliged leaves) adjusted against his notice period, is entitled to service Charge (S.C. is the variable amount and is given to the staff as an incentive on the amount of sale)
He didn't take the PLs but wanted it to get adjusted against the notice period of 30 days and his HOD agreed to it......However, my question now is that His salary for the last month needs to be processed, and though he would have only got Basic pay for the no. of PLs he had in his account in case of PL encashment, company is ready to pay him his full (gross) salary BUT the employee wants the complete salary along with the Service Charge!!
Could you please let me know what would be right course of action in this case? Is company liable to pay him the S. C. amount since he didn't come to work even for a single day during that month....
From India, Delhi
Hi,
The adjustment should be done in monetary terms. If the Notice Period Salary he is supposed to pay is Rs X, then the Leave Salary adjustment should be equal to this - no more, no less. Depending on this, the difference is to be paid by the employee or vice versa.
Regards,
Vasudev
From India, Madras
The adjustment should be done in monetary terms. If the Notice Period Salary he is supposed to pay is Rs X, then the Leave Salary adjustment should be equal to this - no more, no less. Depending on this, the difference is to be paid by the employee or vice versa.
Regards,
Vasudev
From India, Madras
Hi, Thanks a lot for your reply but Could you please elaborate........He has 30 PLs in his account. Now, in case we give him PL encashment, the same will be calculated as (1 day basic* No. of PLs balance). However, since his PLs are being adjusted against the notice period of 30 days, the Company instead of paying the basic salary will be paying him his gross of say Rs.8K (full pay) but will he be entitled to Service Charge (Incentive) since he hasn't worked even for a single day.........
From India, Delhi
From India, Delhi
Hi Smriddhi,
This person has 30 PLs left. Let us take his Basic as Rs 200 per day. His total Leave Salary would then be Rs 6000 (200x30).
On the other side, he is supposed to pay 1 month's Notice Pay, which is Rs 8000. If he wants to adjust his PLs (Leave Salary) against the Notice Pay, then he would have to pay the company Rs 2000 more (8000-6000). He would not be eligible for any incentive. This is because, generally, the Notice Pay is the Gross Salary and not just the Basic Salary.
Hope this helps.
Regards,
Vasudev
From India, Madras
This person has 30 PLs left. Let us take his Basic as Rs 200 per day. His total Leave Salary would then be Rs 6000 (200x30).
On the other side, he is supposed to pay 1 month's Notice Pay, which is Rs 8000. If he wants to adjust his PLs (Leave Salary) against the Notice Pay, then he would have to pay the company Rs 2000 more (8000-6000). He would not be eligible for any incentive. This is because, generally, the Notice Pay is the Gross Salary and not just the Basic Salary.
Hope this helps.
Regards,
Vasudev
From India, Madras
Dear Smriddhi,
The employee is not entitled for Service charege, because it is an incentive basis on service. As he is not serving the organisation any more and taking the salary in advance he is not entitled for that. So in my opinion you have to pay him his gross salary excluding service charge.
But if you think another way if he has taken 10 days leave during this period in what basis you make his salary ? Will you give him service charge for the entire month or deduct the service charge for his leave period ? If you think in this way what he asks is right he should get the salary including service charge.
One more thing as per your company policy what is the rule for notice pay ? If you deduct the notice pay will you recover the salary including service charge ? In that case aslo you need not pay him service charge.
Hope this will give you some more options to decide.
Regards,
Sreekanth
From United States
The employee is not entitled for Service charege, because it is an incentive basis on service. As he is not serving the organisation any more and taking the salary in advance he is not entitled for that. So in my opinion you have to pay him his gross salary excluding service charge.
But if you think another way if he has taken 10 days leave during this period in what basis you make his salary ? Will you give him service charge for the entire month or deduct the service charge for his leave period ? If you think in this way what he asks is right he should get the salary including service charge.
One more thing as per your company policy what is the rule for notice pay ? If you deduct the notice pay will you recover the salary including service charge ? In that case aslo you need not pay him service charge.
Hope this will give you some more options to decide.
Regards,
Sreekanth
From United States
Hi
If he has asked to adjust his PL against notice period then you have to pay the Gross and not basic. If he were to resign and then go on 30 days leave you would anyway pay him the full salary.
Regarding the service incentive, since he is not working for 30 days he will not be eligible for the incentive.
Hope it helps.
From India, Pune
If he has asked to adjust his PL against notice period then you have to pay the Gross and not basic. If he were to resign and then go on 30 days leave you would anyway pay him the full salary.
Regarding the service incentive, since he is not working for 30 days he will not be eligible for the incentive.
Hope it helps.
From India, Pune
Hello,
If the employee is not working , when he is on notice period service charge is not applicable for him. Straight way deduct his one month salary and pay him the PL.
We follow a process in this way,
If employee resigns:
1 Individual has to serve one month notice period.
2 If, not deduct 1 month notice period salary and pay him PL and LTA.
3 If the individual serves the notice period of 1 month- pay his salary, PL and LTA.
4 Service Charge: It is Incentive. Incentive is based on performance. Measure is performance for 1 month and pay him if the individual meets the mesurement card as per your companys performance measurement tool. But, frankly speaking resigned employees performance during the notice period never meets the expectation. Individual is in the mindset to complete his unfinished or pending work and hand over the charge. He overlooks his performance.
I hope this will help you.
Regards,
Nimish Joshi
From India, Mumbai
If the employee is not working , when he is on notice period service charge is not applicable for him. Straight way deduct his one month salary and pay him the PL.
We follow a process in this way,
If employee resigns:
1 Individual has to serve one month notice period.
2 If, not deduct 1 month notice period salary and pay him PL and LTA.
3 If the individual serves the notice period of 1 month- pay his salary, PL and LTA.
4 Service Charge: It is Incentive. Incentive is based on performance. Measure is performance for 1 month and pay him if the individual meets the mesurement card as per your companys performance measurement tool. But, frankly speaking resigned employees performance during the notice period never meets the expectation. Individual is in the mindset to complete his unfinished or pending work and hand over the charge. He overlooks his performance.
I hope this will help you.
Regards,
Nimish Joshi
From India, Mumbai
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