Facing Retrenchment: What Compensation Can We Expect from Our MNC?

I have been working with a multinational corporation (MNC) since December 2006, and my employment status became permanent in April 2008. I have recently been informed that the company is planning to retrench me and other employees. Could you please advise on the compensation benefits that we may be entitled to claim from the company?

I, along with sixteen of my colleagues, eagerly await your response.

Thank you.

Best Regards,
SS

There is no concept of a "permanent job" in the private sector. You are paid until the time you work well, and then it's a goodbye. In your and your friend's case, you can refer to the terms and conditions mentioned in your offer letter/acceptance letter. If none of the clauses have been violated, there is not much you can do.

Regards,
Rajni Hira
Assistant Professor

You will receive the Notice Pay as per the Terms and Conditions agreed upon by you at the time of joining. Additionally, you will be entitled to Retrenchment Compensation, Leave encashment, and any Gratuity that is due to you.

Thank you.

Rajini Hira is right. However, regarding compensation and benefits, I would like to inform you that you will be entitled to PF, Gratuity, bonus, leave encashments, etc. But all these benefits accumulated will only be granted once you fulfill the exact terms and conditions attached to each benefit as per government norms.

Kindly go through each entitlement's enactment. It is also true that the most important document is your appointment letter/offer letter where the terms and conditions of your employment should mention these and other fringe benefits given to you at the time of joining.

Thanks,
Bijay

My suggestion is to follow the terms and conditions as outlined in your offer or appointment letter for claiming notice pay (based on gross salary or basic salary as specified).

1. Collect your experience and relieving letter on the last day of work.
2. Check your full and final settlement with accounts: salary based on payable days, notice pay if the company is prepared to pay, and earned leave encashment if applicable.

Regards,
Ankit Saxena

When it comes to retrenchment, the following will apply:

1. The company is required to pay the Notice Period as per your contract. However, some companies may offer special consideration since they are laying you off. Instead of, say, 1 month as per the contract, you might be paid up to 3 months. Review what your retrenchment letter says regarding this.

2. Severance pay is governed by employment law. Companies are required to pay severance, gratuity, or service pay for all the years you have worked for the company. Review your country's employment law to understand the guidelines for this.

3. Your pro-rata leave pay. Any accrued leave days that are outstanding must be paid together with your terminal dues.

4. Your salary up to the last working day (in addition to the notice pay mentioned above).

5. Pro-rata leave travel allowance, where applicable.

6. Any other allowances earned during the last month of service.

I hope this answers your question. Thank you.

Regards,
Manjika