Hi All,
This is regarding an employee who left the organisation after buying out his/her notice period. He/She has requested to issue a receipt mentioning the amount they paid as buyout along with the company logo. Please let me know if issuing such a receipt is legal and if yes, what should be the content of the same? Kindly help me out on this
From India, Bangalore
3This is regarding an employee who left the organisation after buying out his/her notice period. He/She has requested to issue a receipt mentioning the amount they paid as buyout along with the company logo. Please let me know if issuing such a receipt is legal and if yes, what should be the content of the same? Kindly help me out on this
From India, Bangalore
Dear Vidya,
Rather than issuing separate letter for the receipt of payout amount, I recommend you issuing him "No Due Certificate cum Employment Certificate". This will lay all his doubts to rest. Let the letter be signed by MD of the company.
If the employee still insists on the receipt, then let him submit the cheque with covering letter. On his file copy, he may attach photocopy of the cheque. On this copy, he your office may endorse acknowledgement.
Thanks,
Dinesh V Divekar
From India, Bangalore
Rather than issuing separate letter for the receipt of payout amount, I recommend you issuing him "No Due Certificate cum Employment Certificate". This will lay all his doubts to rest. Let the letter be signed by MD of the company.
If the employee still insists on the receipt, then let him submit the cheque with covering letter. On his file copy, he may attach photocopy of the cheque. On this copy, he your office may endorse acknowledgement.
Thanks,
Dinesh V Divekar
From India, Bangalore
There is nothing legally wrong in giving a receipt for any payment that you have received.
The employee is right in asking for the same as he needs proof that he paid the money and also what it was paid for. Tomorrow if the income tax department asks for an explanation, he needs to have such a document to show.
The receipt needs to be on a company letterhead (company act requires all documents issued by the company - not being an agreement on stamp paper - to be on the company letter head and having the registered address clearly stated). Who is to sign it should be decided based on your structure, mostly head of accounts or director (if it's a small company). The receipt should blearily state that it is received in settlement if notice pay.
From India, Mumbai
The employee is right in asking for the same as he needs proof that he paid the money and also what it was paid for. Tomorrow if the income tax department asks for an explanation, he needs to have such a document to show.
The receipt needs to be on a company letterhead (company act requires all documents issued by the company - not being an agreement on stamp paper - to be on the company letter head and having the registered address clearly stated). Who is to sign it should be decided based on your structure, mostly head of accounts or director (if it's a small company). The receipt should blearily state that it is received in settlement if notice pay.
From India, Mumbai
I am also of the opinion of what Mr. Banerjee has stated, there is no harm in giving a receipt of the payment received by your company, the content should be like this " Received with thanks a sum of Rs. ________ (In words also) only vide Cash/Bank cheque No. ___________ dated _______drawn on _______Bank towards Notice Period Buyout"
The same can be signed by a Cashier/Accounts Authorized personnel.
From India, Ahmadabad
The same can be signed by a Cashier/Accounts Authorized personnel.
From India, Ahmadabad
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Full n final settlement.doc
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