Hi All, I would like to understand the Full and final settlement process (FNF) for a private limited company. We usually calculate salary from 1st to last day of every month and pay on 07th of the coming month. So the salary for October month from 1st to 31st Oct 2021 was paid on 07th November 2021. We have recently incorporated a rule that in case of resignation, we will clear the dues in 45 days from the last working day.
An employee resigned on 20th November 2021 and his notice period is accepted till 10th December 2021.
I would like to understand in the case of resignation of this employee, should I pay his salary for the full month of November 2021. Or should I pay from 1st Nov 2021 till his resignation date i.e. 19th Nov 2021 and the remaining salary of notice period from 20th Nov to 10th Dec 2021 within 45 days? OR should I have to hold back the salary of November month and 10 days of Dec and pay all dues within 45 days?
In the given case, the salary for NOV has to be paid on 7th Dec along with Payroll of your company together with your working employees' list in payroll. Your calculation of course will include only days actually worked and authorized leave with pay if any.
In case of December Salary you may do along with F&F as you need to remit PF and other contributions and you will compute dues like Gratuity if eligible under the Act and completed stipulated service requirement etc based on Dec salary. If it is a factory, the as per Law the Leave Salary for the balance leave has to be settled within 2 days of exit which also kindly take note.
From India, Chennai