Notice Period
Notice period is the time an employee must continue working after submitting their resignation, as defined in their employment contract. In India this is typically 30, 60, or 90 days.
What is Notice Period?
Notice period gives the employer time to find a replacement, transition responsibilities, and complete handover. It is set in the employment contract or company HR policy. If an employee leaves before completing notice, they may have to "buy out" the unserved days by paying notice-period pay (typically basic salary for those days).
Formula: Notice buyout = (Basic + DA) ÷ Working days in month × Days of notice not served
How Notice Period is used
Notice period starts from the date of resignation acceptance. During notice, the employee continues to earn salary, accrue leave, and have all benefits intact. Final settlement (F&F) is done after the last working day.
Notice Period FAQs
Can notice period be waived?
Yes, if both employer and employee agree. Many employers allow leaves to be adjusted against notice period.
Who pays the notice buyout, employer or employee?
Whichever party wants to skip notice. If the employer terminates without notice, they pay. If the employee leaves early, they pay.
Is notice period legally binding?
Yes, if signed in the employment contract. Courts generally uphold reasonable notice periods (typically up to 90 days).