How Should Salary Revision Be Handled When an Employee Withdraws Resignation During Notice Period?

We are an IT service company. We have a pay revision cycle every April. As per our policy, during pay revision, it will not be applicable for the individual if he/she is in the notice period (3 months). One of our employees has withdrawn the resignation during the notice period. What should be done to the salary revision? Should it be made effective from April, and arrears paid this month, or will the revision be effective from the month the resignation was withdrawn? Kindly let us know good practice or industry practice.

Revision of salary is not a mandatory requirement. It is purely based on the performance and company's capacity to pay or incur additional expenditure.

For an employee who has resigned and then withdrawn the resignation, whether the revision of salary should be considered or not is a corporate decision or policy. If it is to be considered, the timing of the revision and all related aspects should be determined by the company.

As Babu has explained, there are no rules in this regard in the law. However, you need to see the company policy on it. Further, you need to see it from an HR and IR point of view.

- Why has he withdrawn the resignation? Because he wants to take advantage of the increment and then leave?
- Or is it that he can't find another job (or the offer was withdrawn)?
- Did someone induce him to stay, and do you want to retain him?

Whether you should give him the increment or not (or give it with retrospective effect) depends on the answers to the above questions and what the plans of your management are with respect to this employee. You need to speak to the relevant decision-maker and take his opinion.

Dear Friend,

Put yourself in the shoes of another person, and you will come to understand what constitutes good practice. The employee has been in continuous service; he has not left and rejoined. He withdrew his resignation during the notice period. Imagine you are that employee and you are deprived of an annual increment. How would you react? Would your morale still be high?

Thank you.