Is My Relieving Letter Truly Valid If It Mentions Outstanding Dues?

I paid all dues to my past company. I was given a relieving letter and a service certificate. The relieving letter says, "The management has accepted your resignation without prejudice to recover all outstanding dues, if any, and you are relieved from the services of the company at the close of work on Xth Dec, 20XX." Is this okay?

Some additional information:

I also have a full and final settlement mail from the company stating my pending dues to be paid. I paid them through NEFT and sent them the payment details in a reply mail. They did not acknowledge the receipt of payment, but after that, they gave me the relieving letter and service certificate. The service certificate is okay, but the relieving letter states that "management has accepted your resignation without prejudice to recover all outstanding dues, if any, and you are relieved." Also, I have to say that the company has the process of giving relieving and service certificates first, and it may take some months after that to process the full and final settlement. So, is this relieving letter okay and acceptable in other companies? (This is my first working company, so I'm not experienced in these terms. I'm currently on a break to study for entrance exams).

Dear friend,

Components of a Relieving Letter

Basically, a relieving letter should contain the name of the employee, their designation, the circumstances or reasons, and the date on which the employee is relieved.

Concerns with Conditional Relieving Letters

If the relieving letter prescribes any conditions like the one mentioned in the post, it shows poor drafting as well as over-cautiousness. Logically, a resignation can be accepted subject to certain reasonable conditions like serving the notice period in full, properly handing over the charge, returning all the assets of the employer entrusted to the employee in connection with the job, and clearing all dues, etc. When the employer takes their own time to disburse the F&F settlement, how can they issue a conditional relieving letter for relieving the employee from the organization? Strictly speaking, a relieving order or letter indicates the final stroke of separation by putting a mutual end to the contract of employment.

Understanding from a Legal Perspective

However, if your prospective employer has a legal bent of mind and an understanding of the essentials of a relieving letter, I don't think they'll have any objection. Even otherwise, you have the bank records for the transactions in this regard. Perhaps, your previous employer will provide the particulars of receipt in the statement of F&F settlement. If not, insist on a separate receipt.

The standard practice is to issue a relieving letter first and then, after verification from accounts confirming no outstanding dues on your part, the company provides a service certificate with all your details.

Thanks,
Jayant Nisal
[Email Removed For Privacy Reasons]
[Phone Number Removed For Privacy-Reasons]

Understanding Relieving Letters and Outstanding Dues

This is the typical wording employers use in the relieving letter, with a strong emphasis on recovering any outstanding dues that may surface after an employee leaves the organization. This practice is common in the industry. If there are no dues to be paid, there is no need to worry. Ensure your side is clear and consider requesting a "No Dues Clearance Certificate" from them if you wish. Companies usually release employees only after confirming there are no outstanding dues. You may want to opt for this for your records.

Take care,

Dr. P. Sivakumar
Doctor Siva Global HR
Tamil Nadu