Notice Period & Full-and-Final Calculator

This is contract arithmetic, not tax law

There is no statutory notice period for private employment in India. There is no statutory rule about whether a buyout is computed on basic or on gross, and no statutory per-day divisor. All of it comes from your employment contract, which is why this page asks you for the days and the rate rather than telling you what they are.

The convention we apply, and state, is a thirty-day month for the per-day rate. If your contract says otherwise the arithmetic is the same with a different divisor. Read the clause - the difference between a basic-based and a gross-based recovery is often two to one, and it is the single largest variable in the number.

What goes into a full-and-final settlement

The settlement is a sum of what you are owed less what is recovered. Pending salary for days worked but unpaid, encashment of accrued earned leave, and gratuity if you have qualified, against the notice shortfall recovery and anything else outstanding - unreturned equipment, a salary advance, a training bond.

• Notice shortfall recovery, on basic or gross as your contract specifies
• Pending salary for unpaid worked days, computed on gross
• Earned leave encashment, computed on basic
• Gratuity, where five years of continuous service is complete
• Other recoveries - assets, advances, bonds

The net can be negative, and that is the useful case

A short notice period with little accrued leave produces a settlement the employee owes rather than receives. We compute that and label it, because it is the most important thing this page can tell someone who has not yet resigned, and it is far better known in advance than discovered in a settlement letter.

The one statutory figure on this page is the leave-encashment exemption ceiling under Section 10(10AA) for non-government employees. It was raised substantially in 2023, so a calculator carrying the old figure understates the exemption by a wide margin.

What it will not do

It will not give a legal opinion. Whether a notice clause is enforceable, whether a buyout can be negotiated down, and whether a bond is valid are contested questions that depend on your contract and the facts - and none of them is arithmetic.

It also does not compute tax on the settlement beyond flagging the leave-encashment exemption, does not generate a settlement letter, and cannot tell you when your employer must pay. Common practice is thirty to forty-five days from the last working day, but that is practice rather than a guarantee.