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Labour Codes, in force 21 Nov 2025

Notice pay recovery and buyout

Short on notice? See what they may recover, and what you're left with either way.

Your exit

Workers get leave encashment in 2 working days and statutory retrenchment pay. Managers get these per their contract.

Your pay

Used for gratuity. Under the Labour Codes at least 50% of total pay counts as wages.

Leave blank to use basic + DA.

More dues, payments and deductions

What they say you owe

For the letters

Only used to fill the email and notice. Stays in your browser.

₹30,000

15 days short × gross ÷ 30. Their claim, not a deduction you must accept.

They may recover this under your contract. The Code on Wages s.18 list of deductions does not mention notice pay, and courts have not settled whether it can be set off. It is never a ground to withhold gratuity (CSS s.53(6)).

Owed to you₹2,12,308
If they recover it₹1,82,308
If they don't₹2,12,308

Set "Notice period" to "Served less" or "Buying it out" and enter the days. Example above: 60 days required, 45 served, gross ₹60,000.

Calculator and template, not legal advice. Rules as of 12 Oct 2026. Your contract, State law and policy can change the numbers.

2 of 4 parts late₹2,12,308
Ask HR

When must full and final settlement be paid?

Not all at once. Since the Labour Codes came into force on 21 November 2025, wages (salary for days worked, and allowances) must be paid within two working days when you resign or are removed, dismissed or retrenched (Code on Wages, 2019, section 17(2)). The law says two working days "of" the resignation; we count from your last working day, the later date. Gratuity has its own deadline: 30 days from when it becomes payable (Code on Social Security, 2020, section 56(3)). Statutory bonus is due within 8 months of the end of the accounting year (Code on Wages s.39). Leave encashment is due in two working days for "workers" (OSH Code s.32); for managers it depends on your policy and State law.

How is it calculated?

Example: last day 31 August 2026, gross ₹60,000, basic + DA ₹30,000, joined 1 February 2019, 12 days' leave. Salary for August ₹60,000. Leave 12 × 30,000 ÷ 26 = ₹13,846 (₹12,000 if your company divides by 30). Gratuity for 7 years 7 months, counted as 8: 30,000 × 15 ÷ 26 × 8 = ₹1,38,462. Total ₹2,12,308.

Gratuity after 4 years 240 days?

The rule is 5 years of continuous service (1 year for fixed-term contracts, paid pro rata). Some High Courts have held that a person who worked 240 days in the fifth year qualifies. The Supreme Court has not settled it, so treat it as a claim, not a right.

Can they deduct notice pay?

Employers often recover a notice shortfall under the contract. The list of deductions the Code on Wages allows (s.18) does not mention it, and no court has settled the point under the Codes. A reasonable training bond can be valid (Supreme Court, Vijaya Bank v Prashant Narnaware, 2025). Notice pay is not a ground to withhold gratuity (CSS s.53(6)).

Is my data stored?

No. The maths and the letters are made in your browser and nothing you type is sent to our server.