HCL revokes policy to recover Performance Bonus, IT Union hints at a legal battle

After receiving backlash from employees and complaints from IT Unions, HCL Technologies has revoked the policy to recover the performance bonus paid to employees.

Earlier, many HCL employees complained that HCL Technologies is recovering the performance bonus paid to them if they resign. In case of failure, the company is withholding their employment documents.

HCL Technologies revoked the policy after multiple employee complaints, and a few even approached the IT employees union.

“During the pandemic, beginning last year, HCL Tech decided to waive off all the performance conditions attached to this component and pay 100 percent in advance to reward its employees. In the final settlement, the company would deduct the advance variable pay if any employee left ahead of completing the performance review cycle in the final payment. We will continue with the advance variable payout for our employees and have also waived off the recoveries w.e.f December 22, 2021,” said the company in a statement.

It explained that the company paid the variable pay in advance to all the junior management employees as a supplement to their fixed salary, as stated in terms of payment.

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HCL recovering Performance Bonus

Many employees, who are resigning between September 2021 and March 2022, noticed that the company is recovering the performance bonus paid to them in full.

After a complaint to IT union NITES, its president Harpreet Saluja wrote a letter to the Ministry for Labour and Employment, stating, “The payment of bonus is the statutory liability on the employer and receipt of the bonus amount is the legal right of employees. The amount paid, to whom to be paid, and when to be paid has been well framed in the Payment of Bonus Act. The employer can not unethically amend the bonus scheme depriving bonus to its employees, and the one who resigned from the service also are entitled to a bonus for their tenure.”

While the company has now revoked the policy, Saluja said that it is only for the Engagement Performance Bonus, a variable component paid to the employees monthly. The advance Monthly Performance Bonus has not been revoked, which the company will recover from employees.

He even mentioned that the union would fight a legal battle with HCL Technologies against an illegal bonus recovery policy and for a refund of the bonus amount deducted to all employees.