Notice Period & Severance Calculator
Resigning, being terminated, or laid off? Calculate your last working day, gratuity eligibility, severance entitlement, and what you actually receive in each scenario.
Your Timeline
What You Receive
Gratuity Calculation
Gratuity = (Last Drawn Salary × 15 × Years of Service) / 26
For your inputs: (₹₹90,000 × 15 × 5) / 26 = ₹₹2,59,615
Capped at ₹20 lakh as per Payment of Gratuity Act. Government employees may have higher limits under their service rules.
Notice Period & Severance Rules (2026)
Resignation
Employee gives notice as per contract (typically 1-3 months). Salary paid during notice. Gratuity if 5+ years. Experience and relieving letters provided.
Termination (Misconduct)
Employer terminates for cause. No notice pay, no gratuity, no severance. Employee may challenge in labour court if termination is wrongful.
Layoff / Retrenchment
Under Industrial Disputes Act: 1 month notice (or pay in lieu) + severance at 15 days' average pay per completed year of service. Gratuity if eligible.
Voluntary Retirement
Some companies offer VRS with enhanced severance. Tax treatment varies. Gratuity and PF fully payable. Check company VRS scheme.
Government Employees
Notice period governed by CCS (Leave) Rules. Retirement gratuity calculated on last emoluments. Pension commutation available.
IT Sector Exception
IT/ITES companies with fewer than 100 employees are exempt from Industrial Disputes Act retrenchment provisions. Severance is contractual, not statutory.
Understanding your rights when leaving a job
Whether you resign, are terminated, or are laid off, you have specific rights and entitlements under Indian labour law. Knowing them helps you negotiate better and avoid being shortchanged.
Resignation
You give notice as per your contract. You are entitled to salary during the notice period, gratuity if you have 5+ years of service, and an experience letter. You are not entitled to severance.
Termination for misconduct
Employer terminates for cause. No notice pay, no gratuity, no severance. However, the employer must prove misconduct. You can challenge wrongful termination in a labour court.
Layoff / Retrenchment
Under the Industrial Disputes Act (for companies with 100+ employees): 1 month notice (or pay in lieu) + severance at 15 days' average pay per completed year of service. Gratuity if eligible. IT companies with fewer than 100 employees are exempt, so severance is contractual.
Gratuity: the 5-year rule
You need 5+ years of continuous service to claim gratuity. The calculation is (Last Drawn Salary × 15 × Years) / 26, capped at ₹20 lakh. Government employees may have higher limits. If you resign at 4.5 years, you get nothing. At 5 years, you get the full amount.
Disclaimer: This calculator provides general guidance based on the Payment of Gratuity Act, Industrial Disputes Act, and common employment practices. Actual entitlements depend on your employment contract, company policy, and applicable state laws. For disputes or specific advice, consult a labour lawyer or your union representative.
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