Dear Members,
I am employed with a software company (services). I have a query regarding the notice period. As per the employment terms policy of my employer:
"On confirmation of your services in the Company, your services shall be terminable by giving three months' notice or three months' basic pay in lieu thereof on either side at the sole discretion of the management."
My query is: If one resigns and is willing to serve the complete notice period but the company wants to relieve the employee early, can the company ask the employee to pay the basic instead? I understand that under such circumstances, it's the company that should pay the employee basic for those particular months. Kindly correct me if I am wrong.
The above question arises from the fact that in the past, employees have been forced to pay basic to the company, even though they were willing to serve the notice period of 3 months. Is this legally right? Kindly let me know your views.
Regards, Nandini
From India, Bangalore
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I am employed with a software company (services). I have a query regarding the notice period. As per the employment terms policy of my employer:
"On confirmation of your services in the Company, your services shall be terminable by giving three months' notice or three months' basic pay in lieu thereof on either side at the sole discretion of the management."
My query is: If one resigns and is willing to serve the complete notice period but the company wants to relieve the employee early, can the company ask the employee to pay the basic instead? I understand that under such circumstances, it's the company that should pay the employee basic for those particular months. Kindly correct me if I am wrong.
The above question arises from the fact that in the past, employees have been forced to pay basic to the company, even though they were willing to serve the notice period of 3 months. Is this legally right? Kindly let me know your views.
Regards, Nandini
From India, Bangalore
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In such scenarios, the employer has to pay notice pay to the employee. In such cases, it should be the full salary and not just the notice pay (basic salary) that should be paid because the employee is willing to work for the notice period in full. Notice pay is applicable when an employee wants an early relieving or when an employer wants to terminate the service with immediate effect. Since an employee has every right to withdraw his resignation before the date becomes effective, the employee should not be asked to leave before the date. Therefore, it is advisable to pay the full salary for three months in order to relieve immediately.
Madhu.T.K
From India, Kannur
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4769Madhu.T.K
From India, Kannur
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Moumachee
There is some catch in the contract you have signed with the company. The relevant clause states that service is terminable with three months' notice or three months' pay in lieu of notice by either party but at the sole discretion of the company. The company seems to be invoking this clause to relieve the employee earlier than the notice period. It contends that since the employee has not served the notice period, he has to pay the notice pay. At the same time, it denies the liability to pay 3 months' pay under the "sole discretion" clause if you demand it by contending that it amounts to termination since he was relieved earlier, though you wanted to serve the notice period. Though the clause is discriminatory, it is nevertheless mischievous and not plain.
B. Saikumar
HR & Labour Law Advisor
Mumbai
From India, Mumbai
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There is some catch in the contract you have signed with the company. The relevant clause states that service is terminable with three months' notice or three months' pay in lieu of notice by either party but at the sole discretion of the company. The company seems to be invoking this clause to relieve the employee earlier than the notice period. It contends that since the employee has not served the notice period, he has to pay the notice pay. At the same time, it denies the liability to pay 3 months' pay under the "sole discretion" clause if you demand it by contending that it amounts to termination since he was relieved earlier, though you wanted to serve the notice period. Though the clause is discriminatory, it is nevertheless mischievous and not plain.
B. Saikumar
HR & Labour Law Advisor
Mumbai
From India, Mumbai
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Public Notice from Government of Maharashtra Department of Labour Bonus payment through banks on.pdf