An investigation under section 210 of Companies Act, 2013 was undergoing for Forever Sisters Pvt. Ltd. Before commencement of the investigation, the company concluded its salary revision cycle in the month of May 2024 fo

Section 218 of the Companies Act, 2013 (Act) provides protection to employees during investigation. During the course of any investigation and during pendency of any proceeding against any person concerned in the conduct and management of the affairs of a company. Such company, other body corporate or person shall not discharge or suspend or punish any employee without approval of the Tribunal. This protection is available to employees during the investigation of the affairs or other matters of or relating to a company, other body corporate or persons or of the membership, ownership of shares or debentures. Following actions are not permitted without approval of the Tribunal: To discharge or suspend any employee; or To punish any employee, whether by dismissal, removal, reduction in rank or otherwise; or To change the term of employment to his disadvantages. Further Section 218(5) of the Act clarifies for the removal of doubts that the provisions of Section 218 shall have effect without prejudice to the provisions of any other law for the time being in force. In the given situation, investigation is undergoing and Miss Richa is demoted during its pendency without any approval from Tribunal, which falls under the category of "change the terms of employment to his disadvantage" and hence, contention of Executive Director is wrong.