Tuesday , October 17 2017

Management asking to refund part of salary deposited in bank account

I am really thankful to you, for your guidance provided to all through legal clinic.

I joined my company on 16/12/2013, directly from India with a basic salary of KD 600 and KD 100 for car allowance.

Out of which only KD 600 deposited regularly in my salary account and KD 100 given to me as cash every month.

On 26/09/2016 my company gave me termination letter in which they mentioned that on the strength of the notice period my last working day will be 26/12/2016, which I agreed.

Then in between the notice period on 18/10/2016 I was informed by management that from tomorrow no need to come to office and I could search for a new job outside and my salary will be deposited in my account till last working date mentioned in the termination letter that is 26/12/2016, and they actually deposited my salary till 26/12/2016.

Now when I joined my new company and transferred my residency to the new sponsor, I asked my old company to settle my indemnity but they are asking me to refund the salary which they deposited in my account after 18/10/2016 till 26/12/2016.

As upon their instructions I didn’t go to office after 18/10/2016 but they are saying that 18/10/2016 will be considered as last date to calculate my indemnity and leave salary. I joined my new company on 04/12/2016 please help me to understand the right way and procedure to calculate the indemnity.

Name withheld

Answer: The management of your old company have no business in asking you to refund part of the salary deposited in your account during the notice period. Indeed the stoppage of work after 18/10/2016 was not initiated by you but to the contrary, they decided to forego the remaining days of the notice period and actually went ahead to pay you for the period you did not work for them.

They cannot therefore make a u-turn and ask you for a refund.

They cannot also calculate your indemnity from the day that they asked you to stop work.

The calculation should be made up to 26/12/2016.

According to the Labour Law, indemnity has to be calculated on the latest remuneration which means the basic salary plus all allowances received on a regular basis.

This means that all things being equal, your indemnity must be calculated on KD 700 and not KD 600 but in your case all things are not equal because KD 600 was transferred regularly into your bank account and KD 100 handed to you in cash.

If your employees decided to calculate the indemnity using the KD 600, it will be a tall order for you to insist on the KD 700 since the additional KD 100 never refl ected in your bank account.

To be on the safer side we shall calculate your indemnity using the amount that was regularly transferred into your account — in this case KD 600.

The calculation of the indemnity will therefore be as follows:

Service 3.01 years

Salary KD 600

You are entitled to 15 days for each of the service years = 3.01×15 = 45.15 days.

But these days must first be divided by 26 working days in a month = 45.15 divided by 26 (working days in a month) =1.736 Monthly salary = 1.736xKD 600 = KD 816.

Your total indemnity will be the whole KD 816 since you were fired by the company.

 

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