Termination cost

Review notice, severance, final-payroll and termination-related cost rules using the structured country dataset.

How to read termination cost

Termination cost depends on the employee, contract, tenure and reason for separation. The sections below show the structured notice, severance and final-pay rules instead of forcing one universal number.

Notice rules

Employment rule

What can change this rule+

Inputs

state
Employee category
Contract notice
tenure
Establishment type

Employment rule

Severance rules

Worker retrenchment compensation

Basis

Average pay

Timing

termination

Formula

In retrenchment 15 days per year

Worker reskilling fund contribution

Basis

Last drawn wages

Timing

termination

Formula

In reskilling 15 days wages

Worker layoff compensation

Rate

50%

Basic wages plus DA

Timing

layoff

0%100%

Termination without cause

Employment rule

Termination for cause

Misconduct

Grounds

applicable standing orders/policies/law

Process

Show cause
Charge allegations
Opportunity to respond
Domestic enquiry where required
Impartial findings
Proportionate decision

Suspension pending inquiry possible

Yes

Ordinary notice may not apply for proven serious misconduct

Yes

Gratuity forfeiture only within statutory conditions

Yes

Unused leave and final wages not automatically forfeited

Yes

Poor performance

Same as misconduct

PIP universally required

Recommended process

expectations
Documented deficiencies
Reasonable opportunity
Warnings where appropriate
review
notice

Worker may still trigger retrenchment analysis

Yes

Final payroll

Final wage deadline working days

Events

removal
dismissal
retrenchment
resignation
Other qualifying termination

Gratuity deadline days

Worker leave encashment deadline

Generally 2 working days for discharge/dismissal/quit under OSH leave framework

Components

salary
bonus
gratuity
leave
expenses
Notice pay
Retrenchment or severance
incentives
Lawful deductions

Asset recovery deductions

Must comply with wage-deduction rules

Relieving letter

Common market document not universal statutory right

Service certificate

Applicable law dependent

PF exit reporting

Yes

Geographic scope

national

Termination

Required inputs

Monthly salary
Annual salary
Basic salary
Statutory wages
Gross salary
Employee type
Worker status
state
Establishment type
Company employee count
Tenure years
Tenure months
Termination reason
Unused leave days
Notice served days
Fixed term or indefinite
Gratuity eligible
Bonus eligible
PF member
ESI member

Decision rules

When
worker + qualifying retrenchment
Components
- notice
- 15-day-per-year compensation
- reskilling contribution
- gratuity if eligible
- leave
- wages
- statutory bonus if payable
When
Non worker
Components
- state S&E
- contract
- gratuity
- leave
- earned variable compensation
When
misconduct
Components
- do not automatically calculate retrenchment
- evaluate process and gratuity forfeiture conditions
When
fixed-term natural expiry
Components
- fixed-term rules
- gratuity if qualifying
When
resignation
Components
- contract/state notice
- wages
- leave
- gratuity if eligible

Notice period

category/state/contract dependent

Termination

Scenario dependent

What can change the result?

These are inputs, conditions or exceptions already present in the structured country rules.

+state

+Employee category

+Contract notice

+tenure

+Establishment type

+covered factory/mine/plantation average >=300 workers in preceding 12 months

+Monthly salary

+Annual salary