Salary not paid by your employer? Learn the legal remedies in India, Code on Wages, complaint process, legal notice, employee rights and FAQs.
Legal update: The four Labour Codes, including the Code on Wages, 2019, came into force from 21 November 2025. The Code on Wages now provides the principal central framework concerning payment of wages, replacing the earlier central wage laws covered by the Code.
Salary Not Paid in India: What Can an Employee Do?
Salary is the primary consideration for the work performed by an employee. When an employer delays or withholds earned salary without lawful justification, the employee may have legal remedies for recovery of the amount.
The Code on Wages, 2019 contains specific provisions concerning payment of wages, permissible deductions, claims and penalties. Section 17 deals with the time limit for payment of wages, while Section 18 regulates deductions from wages.
The appropriate remedy depends on factors such as the employee’s status, nature of employment, amount claimed, applicable State rules and the reason for non-payment.
Is Non-Payment of Salary Illegal in India?
An employer cannot simply refuse to pay wages that have become legally due. The Code on Wages establishes a statutory framework for timely payment of wages and permissible deductions. The Ministry of Labour and Employment has specifically stated that workers have a statutory right to minimum wages and timely payment of wages under the new labour-code framework.
However, every dispute over salary is not necessarily a criminal offence. In many cases, the appropriate remedy is a wage claim, labour proceeding, civil proceeding, or other statutory remedy, depending on the circumstances.
What Does Section 17 of the Code on Wages Say?
Section 17 of the Code on Wages, 2019 prescribes time limits for payment of wages.
For monthly-paid employees, wages are to be paid before the expiry of the seventh day of the succeeding month. The provision also addresses employees who are dismissed, removed, retrenched, resign, or become unemployed due to closure; wages payable in such circumstances are to be paid within two working days, subject to the statutory framework and any applicable government-prescribed variation.
This provision is particularly important when an employee’s salary has been delayed or final wages have not been paid after resignation.
Can an Employer Withhold Salary?
Not every deduction or withholding is lawful.
Section 18 of the Code on Wages, 2019 provides that deductions from wages may be made only as authorised under the Code. It also specifies the purposes for which permissible deductions can be made.
An employer therefore cannot arbitrarily deduct salary merely because an employee has resigned, raised a complaint, or is involved in a workplace dispute.
The employment contract, applicable labour law and circumstances should be examined before determining whether a particular deduction is lawful.
Salary Not Paid After Resignation
This is a common employment dispute.
If an employee resigns after completing the required notice period, the employer generally remains liable to pay the wages legally due for work already performed.
Under Section 17(2) of the Code on Wages, wages payable following resignation are to be paid within two working days, subject to the statutory provisions and applicable government rules.
The employee should preserve:
- Resignation email;
- Acceptance of resignation;
- Appointment letter;
- Salary slips;
- Bank statements;
- Attendance records;
- Full-and-final settlement statement;
- Emails with HR;
- Proof of completion of notice period.
Legal Remedies for Unpaid Salary
An employee can consider the following steps.
Send a Written Request to HR
Before starting legal proceedings, send a formal email to HR or management specifying:
- Salary months pending;
- Total amount due;
- Date on which payment was expected;
- Relevant employment documents;
- Requested payment date.
Always retain proof of communication.
Send a Legal Notice
If the employer does not respond, an advocate can issue a legal notice demanding payment of the outstanding salary.
The notice should mention:
- Employment details;
- Salary agreed;
- Period for which salary remains unpaid;
- Amount outstanding;
- Relevant statutory provisions;
- Demand for payment;
- Time for compliance;
- Consequences of non-compliance.
A 15-day period may commonly be provided in an ordinary salary-recovery notice, but it should not be presented as a universal statutory period. The applicable law may prescribe a different period in particular proceedings.
Legal Notice Format for Unpaid Salary
LEGAL NOTICE FOR RECOVERY OF UNPAID SALARY
Date: //20__
By Speed Post / Registered Post / Email
To,
The Employer/Company
Name: __________________________
Address: ________________________
Subject: Legal Notice for Payment of Outstanding Salary and Other Dues
Sir/Madam,
Under the instructions and on behalf of my client Mr./Ms. __________, who was employed with your organisation as __________, I hereby serve upon you the following legal notice:
- That my client joined your organisation on __________ pursuant to the terms and conditions of employment agreed between the parties.
- That my client’s agreed salary was ₹__________ per month.
- That my client duly performed the duties assigned by the organisation. However, salary for the period from __________ to __________, amounting to approximately ₹__________, remains unpaid.
- That despite repeated requests and communications, you have failed to release the lawful dues payable to my client.
- That the continued withholding of earned wages has caused financial hardship to my client and is contrary to the applicable legal framework governing payment of wages.
- You are therefore hereby called upon to pay the outstanding salary of ₹__________, together with any other legally payable employment dues, within 15 days from receipt of this notice.
- Failing compliance within the stipulated period, my client shall be constrained to initiate appropriate proceedings before the competent authority/court for recovery of the outstanding amount and other reliefs available under law, at your risk as to costs and consequences.
This notice is issued without prejudice to all other legal rights and remedies available to my client.
A copy of this legal notice is retained in my office for record and future reference.
Yours faithfully,
(Advocate’s Name)
Advocate
Enrollment No.: __________
Address: __________________
Mobile: ___________________
Email: ____________________
File a Complaint Before the Labour Authority
Where the dispute falls within the jurisdiction of the labour authorities, an employee may approach the appropriate authority with a wage claim or complaint.
The Code on Wages contains provisions concerning claims under Section 45, references of disputes under Section 46, appeals under Section 49, and enforcement mechanisms.
The exact authority and procedure can depend on whether the establishment falls within the Central or State sphere and the applicable rules.
Approach the Appropriate Court or Tribunal
Depending on the employee’s status and nature of the dispute, a claim may also be maintainable before the appropriate court, labour forum or tribunal.
This is particularly relevant where the dispute involves issues beyond simple non-payment of wages, such as:
- Illegal termination;
- Retrenchment;
- Employment-related disputes;
- Breach of employment terms;
- Other service-related claims.
The appropriate forum should be determined after examining the employment relationship and applicable legislation.
Documents Required for Salary Recovery
An employee should preserve as much evidence as possible, including:
- Appointment letter;
- Employment agreement;
- Salary slips;
- Bank statements;
- Attendance records;
- Employee ID;
- Emails and WhatsApp communications;
- Resignation letter;
- Resignation acceptance;
- Full-and-final settlement documents;
- Performance records;
- HR communications;
- Proof of work performed.
Electronic communications can be particularly useful in establishing the employment relationship and amount due.
Can an Employee Claim Interest on Unpaid Salary?
Interest may be claimed in appropriate proceedings depending on the applicable law, contract, statutory provision and circumstances.
The employee should specifically consider claiming interest where there has been substantial and unjustified delay, although the rate and entitlement are not automatically identical in every case.
In S. Bujji Babu Sharma v. State of Andhra Pradesh, the court discussed delayed payment of salary and referred to the Supreme Court’s treatment of interest on deferred salary in the circumstances of that case.
Important Case Law
Kapila Hingorani v. State of Bihar (2003)
The Supreme Court considered prolonged non-payment of salaries and other dues in the context of public sector corporations and the constitutional implications arising from failure to meet legitimate employee claims. The case is relevant to the broader principle that lawful salary dues cannot simply be ignored by public authorities.
State of Jharkhand v. Harihar Yadav (2013)
The Supreme Court considered grievances concerning non-payment of salary and service conditions and noted the availability of statutory remedies for employees.
S. Bujji Babu Sharma v. State of Andhra Pradesh
The judgment discussed the nature of salary as payment due for services rendered and considered the consequences of unjustified deferment of salary.
What If the Company Says It Has No Money?
Financial difficulty does not automatically extinguish an employer’s obligation to pay wages that have become due.
However, the precise remedy may depend upon whether the employer is operational, undergoing insolvency proceedings, has ceased business, or is subject to other statutory proceedings.
Where a company is undergoing insolvency, the employee’s claim may need to be pursued within the applicable insolvency framework rather than solely through an ordinary recovery action.
Salary Deduction Without Permission
An employer cannot make arbitrary deductions from wages.
Section 18 of the Code on Wages permits deductions only for purposes authorised under the Code.
Therefore, an employee who discovers an unexplained salary deduction should request:
- Written explanation;
- Salary calculation;
- Relevant company policy;
- Supporting documents;
- Legal basis for the deduction.
Step-by-Step Action Plan
If your salary has not been paid:
Step 1: Check your employment agreement and salary records.
Step 2: Calculate the exact outstanding amount.
Step 3: Send a written request to HR/employer.
Step 4: Preserve all evidence.
Step 5: Send a legal notice if payment is not made.
Step 6: Approach the appropriate labour authority or forum.
Step 7: Consider court/tribunal proceedings where legally appropriate.
Conclusion
If an employer fails to pay salary that has become due, an employee is not without legal remedies. India’s wage framework now operates primarily through the Code on Wages, 2019, which came into force as part of the Labour Code reforms from 21 November 2025. Section 17 specifically deals with the time limit for payment of wages, while Section 18 regulates deductions.
The employee should first create a clear written record of the unpaid amount and request payment. If the employer fails to respond, a legal notice can be issued, followed where appropriate by a claim before the competent labour authority, court or tribunal. The correct forum depends on the nature of employment and the applicable law.
Frequently Asked Questions: Salary Not Paid in India
What can I do if my salary is not paid?
You can first make a written demand to your employer, followed by a legal notice and, where appropriate, a claim before the competent labour authority, court or tribunal.
Which law applies when salary is not paid?
The Code on Wages, 2019 is now the principal central legislation governing wages. It came into force from 21 November 2025.
Is a legal notice mandatory for unpaid salary?
Not in every salary-recovery matter. Whether notice is legally required depends on the applicable law and nature of the proceeding. However, sending a formal demand or legal notice is often useful before initiating proceedings.
Can I send a legal notice if my employer has not paid my salary after resignation?
Yes. Unpaid wages remain recoverable subject to the applicable law. Section 17 specifically addresses wages payable following resignation.
Note: Labour-law remedies can vary according to the employee’s classification, employer, establishment, State/Central jurisdiction and the nature of the claim. For a specific dispute, the applicable forum and limitation period should be checked before filing.
