Retrenchment Benefits for staff - after serving 07 years as Executive-Accounts in a company

Hi all,

If a staff member resigns from his job after serving 7 years as an Executive-Accounts in a company, what benefits are applicable to him at the time of his resignation? Please advise me at your earliest convenience.

Since resignation is a termination of the contract of employment initiated by the employee himself, he is entitled to the terminal benefit of gratuity only subject to the conditions of applicability of the PG Act, 1972 to the establishment and his completion of the minimum qualifying service.

In addition, he is entitled to encashment of EL at his credit if any and to proportionate bonus for the accounting year during which he worked till the date of his resignation. No retrenchment compensation.

Gratuity, EL encashment, and statutory bonus for the financial year until the date of resignation will be provided. In addition to these benefits, he will be eligible to receive his monthly salary and any applicable incentives.

One small correction to Mohammad's post: He is eligible for incentives only if it was a part of his contract. If the incentives are at the option of the employer, then he is not entitled to it as a right.

Dear colleague,

To be eligible for the retrenchment benefit, the 'workman' category of the employed person should have been 'retrenched' in the first place as per the provisions of the Industrial Disputes Act/Rules. Retrenchment is an act on the part of the employer to terminate the services, whereas resignation is an act by the employee/workman to end his services. Therefore, as rightly stated by learned colleagues, in this case, he is not entitled to the retrenchment benefit, except for other due terminal benefits.

Regards,
Vinayak Nagarkar
HR and Employee Relations Consultant