Confused About Notice Period and Salary Deductions? How Should I Handle This Situation?

I have a query regarding the notice period. I recently resigned from my organization and submitted the resignation letter stating that I would be serving the required notice period of 1 month. Later in the day, the HR informed me that there is no need to serve the notice period, and I have been relieved from my services with immediate effect. They also informed me that my last month's salary would be deposited in a month's time.

I asked them the reason for the same, to which they replied as administrative routine. They also told me that my relieving and experience letter will be handed in a month. Later when my salary came, there were many deductions in it. Also, since the management decided for me not to serve the notice period, they should have ideally paid me the next month's salary also, which they denied to do.

How can I proceed in such a situation?

Simply forget it. It all depends on the offer letter you had from the company. It may be mentioned in the offer letter that one month notice is required, as you said. I feel the company was generous to release you early (perhaps they have their own reasons for not requiring you to serve the notice period) with pay.

The appointment letter clearly states that if the management decides that I should not serve the notice period, then they will give one month's salary in lieu of it.

Hi,

Every company has its own standardized full and final settlement procedure. Due to that, deductions are made. You must have received the full and final settlement copy from which you can work out where exactly your money is deducted. If you have not yet received the F&F copy, you can ask for it. It will consist of your leave balance, notice period, and all the information that can address your query.

As rightly said by Balaji, your company is liberal to relieve you early with the pay.

First, go through your appointment letter, then compare it with the following points.

During the period of probation or the extended period of probation, the contract may be terminated by either side without assigning any reason, and by giving xyz days' notice in writing or payment in lieu thereof.

You shall be entitled to your basic salary and allowances in lieu of the remaining period of notice if the company asks you to leave.

Notwithstanding the aforementioned, the Company shall have the right to terminate your employment without notice or payment of salary in lieu thereof on the occurrence of the following events:

a. you commit any breach of your duties and responsibilities under this contract of service;

b. you are guilty of any gross default or misconduct, misrepresentation, which contravenes the express or implied conditions of your employment;

c. you commit a breach of any of the terms as mentioned in your appointment letter; and

d. you remain absent from work, without any reasonable explanation, for more than (as mentioned in your appointment letter) consecutive days; it will be presumed that you are no longer interested in working for the Company and have abandoned its services;

e. indulge in any activity involving moral turpitude.

Dear [Recipient's Name],

You should send a copy of your appointment letter along with a request letter providing your one-month salary, as management has decided to relieve you with immediate effect from your organization. Also, inquire about the deductions, as well as full details of your bonus, annual leave, gratuity (if applicable), etc., through registered post. Additionally, please send a scanned copy of your request letter via email or fax.

Give them two weeks to provide a response. Wait and observe their reaction. We are running an NGO and can support your case against your organization free of cost. Please let me know your thoughts on this.

Best Regards,

Sajid Ansari
Delhi

Dear Yogesh,

This is Varsha here. I have gone through your suggestion, and it was very good. Could you please help me out by suggesting a name for my consultancy? I am planning to start my own consultancy.

Thank you.

Serving notice period after resignation is the company policy, which is a kind of pressure the company generates to hold a person before relieving or settling full and final accounts.

It is at the management's discretion to relieve you before the notice period, which will be treated as waiving the notice period, and this is appreciated. In case of termination, the onus lies with the management.

So cheer up and look ahead to your new assignment.

Dear Meetu,

The views given by Mr. Shajid are absolutely right, and legally, you are entitled to get one month's salary in lieu of notice as you have given notice, and management relieved you immediately.

Regards,
J. S. Malik

In India, there is no job security in the case of private employment, and our government is very silent on this issue. It is a shame that the great trade unions are also not taking up the matter with the government. I had a very bitter experience. After 23 years of sincere service in a private company, one evening, along with some other employees, I was called to the HR department and told to submit our resignations since our services were no longer required by the company, as a part of the retrenchment policy. We submitted our resignations, and the next day we were relieved. However, we were paid one month's salary extra as a token of goodwill. Nowadays, many people are employed on a contract basis only. Our labor ministry should look into this and take serious action.

Dear,

I totally agree with Mr. J.S. Malik as I have experienced this situation with the management in one of my organizations. They had a three-month notice period and found a replacement within two months. Consequently, they informed me that they were relieving me without salary. I had to escalate the issue to the top management to resolve it. Eventually, they paid me for the third month, and I also requested an experience letter until the last date of my notice period.

Therefore, I encourage you to stand up for your rights. It is the employee's right. If we adhere to the decisions and follow the rules and regulations, the company is obliged to compensate us according to the policy.

Thanks,
Adhieti
09371253336

Dear Meetu,

The company cannot deduct the notice period from your full and final settlement, since it was the company's decision to relieve you, not yours. You wanted to serve the notice period. You should communicate with your HR department in a written letter about the same. I am sure you will get a positive response.

Regards, Jagdish Pathak

I also agree with Mr. Sajid's views, so don't worry Meetu, go ahead as Sajid has told you to do and watch what happens. It will be good as you had not done anything wrong.

Regards,
Bharti K

I do not agree with some of the views expressed in this thread.

The purpose of the notice period is to avoid a sudden hole in the organization in case someone decides to leave. The notice period gives time for the employer to find a suitable replacement and also to reallocate work to someone else to complete the job at hand and properly hand over the work.

In certain cases, there are employees who are either deadwood or are not productive and are not contributing much to the organization. In such cases, the employer will not waste their time and money by retaining them on the notice period.

Once an employee decides to leave the organization, they are not likely to make much contribution to the organization. They are interested in somehow handing over their work to someone and moving on.

In this case, all the points mentioned above could be managed in very few days, and the employer was in a position to relieve the employee soon.

In this case, there is no need for the employer to pay any notice pay. The employee decided to leave, and the employer felt that there was no need to insist on the notice period.

Employees should also be aware of the situation in their organization and their standing in the organization so that such decisions do not come as a surprise to them.

Thanks & Regards

Dear Friend,

Absolutely, what has been suggested by Mr. Sajid is legally right.

Thanks,
Mahesh Pandey

Dear Meetu,

You resigned and were willing to serve, but the company did not require your services; hence, they relieved you immediately. Whenever you resign, you either pay or serve the notice period. You were willing to serve, but the employer did not require your services; hence, they relieved you. You must ask them to waive the notice period. Also, remember if the employer asks you to leave, it is termination of the contract, and it is then that they pay you.

Roopradhika

Dear Meetu,

The exit clause contained in a standard Appointment Letter stipulates a Notice Period. In your case, it appears that the Notice Period is One Month. Since you have given a clear One Month's notice in your resignation letter to the Company, the Company is obliged to pay you one month's salary in lieu of the notice if the management decides to relieve you earlier. In short, you are entitled to receive one month's salary in lieu of the notice you have given to the Company.

Best Wishes,
Vasant Nair
09717726667

Your contention is essentially correct since it is the management that has terminated your services. You have agreed to serve one month's notice. Salary deduction can only take place if you have taken leave without pay or have been absent without proper reason.

I suggest you send an application along with a copy of your appointment letter, quoting the provisions in your application. Seek an interview with the Head of the organization and explain your stand. They should be able to justify the deductions; failing which, you can raise the issue to a higher level.

Hey guys,

Thank you so much for such an overwhelming response. I will now contact my administration department with a copy of my appointment letter and ask them about it. I will let you guys know the end result.

Regards,
Meetu

Small family-run companies often indulge in unethical means to harass ex-employees; this fact should be well known by all. These types of companies acquire the title of "company" because of the helpful laws that encourage corporatization. In practice, these companies would put to shame even a baniya's shop. It is a case of harassment.

Since you have submitted your resignation with a notice period of one month, indicating your desire to continue until that date. Now, if the management, for their convenience or otherwise, wants to relieve you before that date, then it's fine; PROVIDED the management is willing to pay you your salary till the end of the notice period as indicated in your resignation letter. If this condition is not met, it would imply a breach of contract on the part of the management for which you are entitled to legal remedy.

Regards.

As per the HR policies of your company, they probably might have relieved you immediately without asking you to serve the complete notice period. Some companies follow an exit policy like this: "If management considers it appropriate that, in the interest of the company, an employee need not be given the opportunity to serve the full notice period."

Also, at times when you confront and insist on salary for the unserved notice period, they might send you on outstation duty for most of the notice period. This would serve no purpose for you.

Agree with Point #1. Disagree with Point #2.

Most of the time, it is the responsibility of the management to get work out from someone whom it has hired. Labeling them later as 'deadwood' is shying away from responsibility. And if at all the management wants to get rid of such non-performers, it must have the courage to tell it on face, rather than keep waiting for them to resign and then relieve them immediately, denying them their dues for the notice period that they wanted to serve. Notice period is a mutual condition of employment, which needs to be adhered to by both parties. Hope I make sense. PD

As per the terms of appointment, if an employee resigns, he is required to give a month's notice to the employer. In this case, the employer did not insist on a notice period and relieved the employee. Where is the question of the employer giving the employee a notice pay?

In case the employer terminates the services of the employee and gives him a month's notice, but the employee wants to get relieved immediately. By your logic, the employee will have to pay notice pay to the employer for early relieving. Is this what you mean when you say "Notice period is a mutual condition of employment, which needs to be adhered to by both parties."

Thanks & Regards

Agree with Point #1.
Disagree with Point #2.
Most of the time, it is the responsibility of the Management to get work from someone whom it has hired. Labeling them later as 'deadwood' is shying away from responsibility. And if at all the Management wants to get rid of such non-performers, it must have the courage to tell it on the face, rather than keep waiting for them to resign and then relieve them immediately, denying them their dues for the notice period that they wanted to serve.
Notice period is a mutual condition of employment, which needs to be adhered to by both parties.
Hope I make sense.
PD

Hi,

Salary deduction in the circumstances as described by you is not justified. If you like, you may serve them a legal notice through your counsel. Decide for yourself whether you would like to take all this hassle and extra expenses.

Best, Jai

Hi,

Please understand that normally any company would follow these procedures:

1. In the case of resignation, waiving the notice period is the management's right because, in many instances, a resigned employee has proven to be a nuisance as they are certain about leaving the company. This certainty often leads them to make many demotivating comments that can impact other employees.

2. If the company decides to terminate an employee, then they are obligated to provide notice or payment in lieu. In your situation, if they have deducted the balance days of your notice period from your salary, that is incorrect. However, if they have not paid for the remaining days of your notice period, that is acceptable.

Best regards,
Vengatesan

My dear Vkokamthankar,

Your logic is wrong, and you KNOW it.

Let me quote you and explain. Your remarks are in blue italics.

I shall take your Second Para first:

You say - "In case the employer terminates the services of an employee and gives him a month's notice, but the employee wants to get relieved immediately. By your logic, the employee will have to pay notice pay to the employer for early relieving."

In MY Humble Opinion: Yes, perfectly right. To repeat: In the case the employer terminates the services of an employee, then the employer gives one month's notice pay (one month or two or three; depending on the T & C).

Similarly, if the employee wants to get relieved immediately, he will have to pay notice pay to the employer (or rather LOSES the notice pay in his Full & Final Settlement).

Now, let us consider your First Para; where you have been CONSISTENTLY WRONG in both your posts:

You say - "As per the terms of appointment, if an employee resigns, he is required to give a month's notice to the employer. In this case, the employer did not insist on the notice period and relieved the employee. Where is a question of the employer giving the employee a notice pay?"

In MY Humble Opinion: THIS IS THE INTERESTING PART. There can be two situations:

SITUATION 1: Employee resigns giving one month's notice BUT REQUESTS TO BE RELIEVED EARLIER (WAIVING THE NOTICE PERIOD).

Here, the employer CAN relieve him IMMEDIATELY or ASAP, without giving any notice pay; (because it is as per the request of the employee)

SITUATION 2: Herein lies the rub. When an employee resigns giving one month's notice, say, for example, he wants to be relieved on the 30th of August, it means he has complied with your requirement as he DESIRES to continue for one month AS PER THE TERMS AND CONDITIONS.

Now, as an Employer, if you are ANNOYED, then you can relieve him immediately. But in this case, since YOU ARE relieving him of your own accord, volition, desire, wish, etc. therefore, YOU ARE REQUIRED TO PAY HIM NOTICE PAY.

I hope I have made myself clear. JUST BECAUSE AN EMPLOYEE SUBMITS A RESIGNATION LETTER; IT DOES NOT ENTITLE YOU TO RELIEVE/DISMISS HIM SUMMARILY AND IMMEDIATELY.

I am sure you subscribe to the Principles of Natural Justice and Business Ethics, apart from other applicable laws of the land.

I have great expectations from you, as a torch-bearer of the HR profession, since you have 15 years of experience and work in an educational institution. I shall be expecting more thoughtful, insightful, illuminating posts from you in the future.

Regards.

As per the terms of appointment, if an employee resigns, he is required to give a month's notice to the employer. In this case, the employer did not insist on the notice period and relieved the employee. Where is a question of the employer giving the employee a notice pay?

In case the employer terminates the services of an employee and gives him a month's notice, but the employee wants to get relieved immediately. By your logic, the employee will have to pay notice pay to the employer for early relieving. Is this what you mean when you say "Notice period is a mutual condition of employment, which needs to be adhered to by both parties."

Thanks & Regards