Notice pay (salary) means basic salary + Dearness Allowance. If there is no such salary structure and salary is consolidated, then notice pay means the gross salary (consolidated salary) paid. This will equate to the salary taken for calculation of bonus, encashment of earned leave, calculation of gratuity and perhaps contribution to Provident Fund.
Since Notice pay applies both to employer and employee lowering the basic pay will have equal impact. If the employer has fixed a low basic pay and there is no DA applicable, then the notice pay will also be less and this will be the amount the employer gets when the employee leaves. At the same time, if the employer wants to retrench a worker, he has to give the worker notice pay. In the former case, the employer needs to pay only the fewer amount. On the other hand, if the Basic pay is high or if DA is high then the notice pay will also be high but will be applicable to both- the employer as well as the employee(s).
Regards,
Madhu.T.K | 
notice salary 
Linear Mode
