Navigating Notice Periods: Can Earned Leaves Offset Your 3-Month Requirement?

I would like to know more about the government regulations regarding the notice period and the liabilities of the employee and the employer.

Notice Period and Earned Leaves

In case there is a 3-month notice period as per the employment contract and there are 45 accumulated earned leaves, can these be adjusted in the notice period? Further, will the balance 45 days of the notice period be calculated based on basic salary or Basic+HRA?

The earned leaves being encashed at present are on basic salary only. The salary breakup of employees is as follows:
- Basic: 50% of total salary
- HRA: 25% of total salary
- Reimbursement: 25% of total salary.

Company Policy on Notice Period and Earned Leave

This will depend on your company policy. You can allow for the earned leave to offset the notice period; there is no legislation saying that you can or can't.

With regards to any payout of the earned leave, again, this can come down to your company policy. We pay the employee out of their accumulated Privilege Leave at their Basic Salary rate, which is 50% of Gross Salary. Some other companies may well pay out on the full Gross salary rate.

If, in lieu of the short/insufficient notice period in case of a resignation, the company is deducting the average daily income as Basic + HRA, then will it not be liable to pay at the same rate in case of termination and immediate relieving? Is there a government regulation regarding the same?