For any corporate employees its is mandatory to know about the Notice period which is mentioned in our employment contract letter. When we join the company then first we complete our probation period then we became confirmed employees.
Genially we heard 2 synonyms of notice period.
1. Notice period Payment
2. Notice period Recovery
What is Notice Period
When you cracked any interview then company provide you offer letter where your remuneration or CTC they mentioned. On the day of Joining HR gives you appointment Letter or Employment Contract letter where they mention the notice period day.
Notice period day is duration of time where employee or employer agreed to serve these day while discontinuing the employment relationship.
Means if any employee intend to resign from his Job then he or she has to serve notice period days for smoothly transition vice-versa if company is termination employee form employment because of company’s layoffs or restructuring then company has to pay some amount to employee so that employees meet their regular expenses.
In some case employees are involved in some fraud case in this case company can terminate on the spot without paying any notice period amount as per the mentioned in the employment contract letter.
So here employee and employer both have the benefits of notice period.
Benefits to employees
- Get time to collect the documents
- Helps to maintain professional relationship
- Maintains professional relationship with vendor
Benefits to Employer
- 1.Get time to search replacement
- Better transition of process
- Minimize the effect of operation disruption
Types of Notice period
Resignation Notice Period:-In this case employee serve the notice as per agreement it might 30 days 45 days or 90 Days in some cases it is 120 days
Termination Notice Period:-In this case employee terminate the employment due to restructuring Layoff etc.
Negotiation of Notice period
Sometimes employee want to leave early because or some personal reason or professional commitment so in this employee should follow below approach
1. Tell the Valid reason – If you want to leave early give your HR a valid reason in request form so that they can grant it with further discussion.
2.Offer transition plan – If you want to leave early then try to convince your Head about the work completion and transition plane so that the company work do not stuck in any point of time
3.Leverage Leave – In many organization if you are not able to complete your entire days of notice then the balance work day are adjusted with you leave balance
4. Notice Buyout – Now a days if you join any company then approach you to join the company as soon as possible. For that they will bear the cost of Notice period recovery. You will get the recovery amount from your new joined company.
Calculation of Notice period Payment Deduction
Notice period Payment :- If employer is terminating the employee and not providing the days to serve then company will pay the amount to employee.
Notice period Recovery:– If employee is leaving the organization without serving the notice then employer will deduct the notice period amount from employee.
Formula if Notice Period Calculation
As per the practice the formula for both employee and employer are same
Gross Salary / 30 * Number of Days not served
Let us take an example An employee has Basic 5000 HRA 4000 LTA 3000 Special Allowance 2000
So the Gross Salary = 14000
Now let he resigned on 15 November and leave the organization on 2nd December so he has served 18 Days and as per his contract he has to served 30 days so the recovery will be for 12 days
14000/30×12 =5600
So in this way we do the notice period calculation.
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Very informative and useful.
Thanks.