I do nor know what are the final settlements in your organisation. But in general the position regarding terminal settlements is as below:
1. Gratuity: In case the employee leaving has completed 5 yrs of service or otherwise eligible for gratuity, the same is payable within 30 days from the date of separation. In case of delay the liability for payment of interest will attract.
2. PF: Employer has no control over PF matters. In case PF is in Company trust, trust is liable to transfer the same if an application for transfer is received. In case PF is recovered from last salary, same needs to be remitted within 15 days time to concerned.
3. Cash equivalent of balance of Leave : Can be held back till settlement of dues. Infact I agree with pratima. Dues can be recovered from OR shortfall in notice period can be adjusted, from leaves due.
4. Regarding shortfall in notice period, some companies (Including mine) have delegated powers to authorities competent to accept resignations, to waive off shortfall in notice period, purely as a goodwill gesture. However, it is entirely for the authority to accept proposals from HR for waival of shortfall in notice period. I think it is used in case the ex-employee is gracefully submitting resignation.
5. cases of 'absconding' employees need to be treated on a differrent footing. Considering pending assignments, knowledge ware or other knowledge tools held with him / her at the point of separation, such cases need to be treated as matters of indisclipline, if required. In which acse, concessions given as a matter of goodwill would not be available to them.
6.I also agree with Girish. Your old employees are your best ambassadors. So, bid them bye with grace. Quick and hassle free settlemt would always be mutually beneficial. Go the extra mile to facilitate his/ her smooth exit.
7. Finally, have a checklist and your responce to various modes of separation for settlement of benefits.. If you are able to draw a scheme and obtain consent of critical opinion makers in your hierarchy, you can bag many smiles from ex-employees.