Notice Period and Incentives: A Dilemma
I have been working for an organization for the last 5 years. I have worked with dedication and have been awarded and appreciated for my efforts. Recently, the company has been facing a problem with retention due to a lack of growth prospects and yearly changes in policies regarding incentives and pay. To address this, they decided to increase the notice period from 1 month to 3 months. In order to gain the approval of employees, they stopped paying incentives for a few months. Then, all of a sudden, they declared incentives and promotions. Both were added to the company letterhead, along with a clause regarding the 3-month notice period.
Many employees in our organization, including myself, are living paycheck to paycheck. Therefore, we had to sign the paperwork as the incentive amount was a requirement. The letter clarified that a 1-month notice would only be accepted at the discretion of the line manager.
Now, HR is stating that if I choose to leave the organization, I must provide the full notice period or pay the organization the remaining period's full salary. Other companies are not willing to wait for 3 months and are also unwilling to hire without a relieving letter. When I attempted to negotiate with my current company, they demanded 70,000 as a buyout for a 2-month notice period, even though 30,000 is too much for me. I cannot afford such a large amount as a buyout, and other companies are also unwilling to pay such a sum. I feel like I am being cheated and am becoming desperate as I am stuck with this company, which is affecting my career.
Please advise if my current company can take any legal action against me or a new organization. Also, can they withhold my relieving letter and experience letter?
From India, Mumbai
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I have been working for an organization for the last 5 years. I have worked with dedication and have been awarded and appreciated for my efforts. Recently, the company has been facing a problem with retention due to a lack of growth prospects and yearly changes in policies regarding incentives and pay. To address this, they decided to increase the notice period from 1 month to 3 months. In order to gain the approval of employees, they stopped paying incentives for a few months. Then, all of a sudden, they declared incentives and promotions. Both were added to the company letterhead, along with a clause regarding the 3-month notice period.
Many employees in our organization, including myself, are living paycheck to paycheck. Therefore, we had to sign the paperwork as the incentive amount was a requirement. The letter clarified that a 1-month notice would only be accepted at the discretion of the line manager.
Now, HR is stating that if I choose to leave the organization, I must provide the full notice period or pay the organization the remaining period's full salary. Other companies are not willing to wait for 3 months and are also unwilling to hire without a relieving letter. When I attempted to negotiate with my current company, they demanded 70,000 as a buyout for a 2-month notice period, even though 30,000 is too much for me. I cannot afford such a large amount as a buyout, and other companies are also unwilling to pay such a sum. I feel like I am being cheated and am becoming desperate as I am stuck with this company, which is affecting my career.
Please advise if my current company can take any legal action against me or a new organization. Also, can they withhold my relieving letter and experience letter?
From India, Mumbai
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On reading your post, it appears that you are confused because you have clubbed unrelated issues with your separation from the company. Please unlink the following issues from your resignation:
a) Quality of your work
b) Attrition rate in your company
c) Quantum of incentive or non-payment of incentive
Employer-employee relationships hinge on the terms and conditions of employment that the employer designs. When you joined the company, the terms and conditions were different. In the recent past, these were changed, and you were communicated this change (increase in the notice period). You have accepted this change. Therefore, there is no room for blaming the employer at this stage.
Options for Handling Notice Period
Now you have four options. These are as follows:
The first one is to pay for the notice period. You mentioned that your financial conditions do not allow this option.
The second option is to bargain with the future company to extend the date of joining. Use your negotiation skills for this. In this option, you will be able to reduce your notice period pay.
The third option is to approach the future company and ask them to provide a "joining bonus." This joining bonus is an amount equivalent to the payment of the notice period. This may sound impossible, but when employers are in dire need of someone with a very specialized skill set, they resort to this type of payment. These things happen in the IT industry, hotel industry, etc. I do not know what type of industry you are in.
The last option is to forego the job opportunity at hand and wait for a fresh one. Next time when you get any job opportunity, tell them clearly about your notice period requirement.
Which option to follow is your choice. Nevertheless, it is important for you to have a smooth exit from the company. After spending more than five years, it is not worthwhile to have a separation by creating bad blood. It is not just separation, but what you need is a proper relieving letter. Please note that Indian employers will always have the upper hand. To some extent, they will try to arm-twist the employees. Accept this as a fait accompli and move on!
All the best!
Regards, Dinesh Divekar
From India, Bangalore
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8083a) Quality of your work
b) Attrition rate in your company
c) Quantum of incentive or non-payment of incentive
Employer-employee relationships hinge on the terms and conditions of employment that the employer designs. When you joined the company, the terms and conditions were different. In the recent past, these were changed, and you were communicated this change (increase in the notice period). You have accepted this change. Therefore, there is no room for blaming the employer at this stage.
Options for Handling Notice Period
Now you have four options. These are as follows:
The first one is to pay for the notice period. You mentioned that your financial conditions do not allow this option.
The second option is to bargain with the future company to extend the date of joining. Use your negotiation skills for this. In this option, you will be able to reduce your notice period pay.
The third option is to approach the future company and ask them to provide a "joining bonus." This joining bonus is an amount equivalent to the payment of the notice period. This may sound impossible, but when employers are in dire need of someone with a very specialized skill set, they resort to this type of payment. These things happen in the IT industry, hotel industry, etc. I do not know what type of industry you are in.
The last option is to forego the job opportunity at hand and wait for a fresh one. Next time when you get any job opportunity, tell them clearly about your notice period requirement.
Which option to follow is your choice. Nevertheless, it is important for you to have a smooth exit from the company. After spending more than five years, it is not worthwhile to have a separation by creating bad blood. It is not just separation, but what you need is a proper relieving letter. Please note that Indian employers will always have the upper hand. To some extent, they will try to arm-twist the employees. Accept this as a fait accompli and move on!
All the best!
Regards, Dinesh Divekar
From India, Bangalore
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I agree with Dinesh. However, there is another option. You can explain your situation to the company you're joining and check with them if they're willing to accept you without a relieving letter. If they agree, then the ball is in your court. Your current company cannot hold you back. They can hold back your salary and relieving letter, though, but you aren't compelled to pay a buyout amount of any sort.
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From India, Mumbai
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From India, Mumbai
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You have mentioned that there is a clause in your terms and conditions that the notice period can be reduced with the approval of your line manager. So why don't you talk to your line manager and convince him to reduce your notice period to one month.
From India, Bengaluru
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From India, Bengaluru
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I agree with Biswajyoti about speaking with your line manager and HR to explain your side. You have the credibility to do so because you have spent nearly 5 years with the company. Whatever notice is agreed upon, ensure you give 100% effort towards a seamless handover.
Speak to your future employer and ask whether it would suffice to provide them with a resignation letter copy, explaining the situation, in the absence of a relieving letter or an unacknowledged resignation letter.
Finally, I believe that in a court of law, although a company can take legal action if it wishes to, the favor mostly lies with the employee. I hope the above helps.
From India, Mumbai
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Speak to your future employer and ask whether it would suffice to provide them with a resignation letter copy, explaining the situation, in the absence of a relieving letter or an unacknowledged resignation letter.
Finally, I believe that in a court of law, although a company can take legal action if it wishes to, the favor mostly lies with the employee. I hope the above helps.
From India, Mumbai
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Legal Notice for Breach of Notice Period .docx
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