In this article
- Separate exit wages from the other settlement components
- The two-working-day rule and separate gratuity timeline
- Free itemised settlement estimator
- Ten copy-ready exit-settlement messages
- Worked settlement examples
- Mistakes that delay a useful resolution
- Frequently asked questions
- Related MNC Insider guides
Ask for an itemised exit statement showing unpaid wages, eligible leave encashment, gratuity and approved reimbursements separately from deductions. The Code on Wages section 17(2) sets a two-working-day rule for specified exit wages; it is not a blanket deadline for every F&F component.
Key takeaways
- Code on Social Security, 2020 sections 53 and 56 govern gratuity eligibility and payment in covered cases, including the separate payment timeline. Do not assume every person leaving a job has the same eligibility, wage base or service treatment. Government service and particular statutory schemes require their own rules.
- All example amounts are fictional arithmetic examples, not salary benchmarks or statutory defaults.
- Use actual payroll amounts and the applicable policy; a calculator cannot verify eligibility.
Separate exit wages from the other settlement components
Full and final settlement is an itemised accounting of what remains payable and what is validly recoverable when employment ends. Start with the confirmed last working day and the unpaid payroll period. Then identify eligible leave encashment, gratuity, earned incentives and approved reimbursements as separate lines. The applicable rule and due date can differ across those lines.
Do not allow a single “F&F pending” status to obscure a wage payment that has its own statutory deadline. Equally, do not assume the wage deadline decides the gratuity amount, tax exemption, bonus eligibility or release of an exit certificate. Ask the employer to show the basis and payment status of each item. Keep notice-buyout approval and attendance records beside the statement because they can explain material adjustments.
| Component | Basis | Evidence |
|---|---|---|
| Unpaid wages | Actual unpaid wage period and applicable wage calculation | Attendance and last paid slip |
| Leave encashment | Applicable law/policy and eligible balance | Leave ledger and approved calculation |
| Gratuity | Coverage, qualifying event, service and statutory wage base | Service records and separate gratuity determination |
| Earned incentive | Applicable scheme and actual eligibility | Scheme and performance/payment record |
| Approved reimbursement | Approved expenses not already paid | Expense approval and payment status |
| Notice recovery | Applicable contract, approval and lawful recovery position | Notice clause, waiver/buyout agreement |
| Other deduction | Specific authorised basis | Itemised supporting document |
| Tax withholding | Applicable tax treatment of each payment | Payroll computation for the relevant tax year |
The two-working-day rule and separate gratuity timeline
Official: Code on Wages, 2019 section 17(2) says wages payable on the specified removal, dismissal, retrenchment, resignation or establishment-closure events are to be paid within two working days, subject to the statutory provisions including the appropriate government’s power under section 17(3). This is a wages rule. It does not say that every amount commonly placed under an F&F heading has the same due date.
Official: Code on Social Security, 2020 section 53 addresses gratuity in covered cases. Its general five-year service condition has statutory exceptions, including the specified death, disablement and fixed-term situations; a generic calculator should not decide these without the actual employment facts. Section 56 provides the separate determination and payment process, including payment within thirty days from the date gratuity becomes payable and the applicable interest provision for delay. Read coverage and exceptions with the section.
The government announced implementation of the four labour codes from 21 November 2025. A current exit statement should identify the applicable Code, rules and employment coverage rather than copying a historical deadline from an older HR article. Government-service benefits and statutory schemes may require separate treatment.
Free itemised settlement estimator
Enter amounts already verified or estimated by payroll. The tool adds them and subtracts the stated deductions; it does not establish gratuity eligibility, calculate a statutory wage base or approve a notice recovery. Keep an uncertain component clearly marked as estimated in the statement you send to HR. Do not ask a reader to enter total CTC and pretend it provides all the information needed for an exit calculation.
| Item | Value |
|---|---|
| Payable amounts | Unpaid wages + eligible encashment + gratuity input + earned incentive + approved reimbursements |
| Deductions | Notice recovery input + other authorised recovery input + TDS input |
| Net estimate | Payable total minus deduction total; a negative result is a proposed net recovery needing verification |
| Eligibility and deadlines | Not computed; assessed separately under the applicable law and records |
An itemised estimate using supplied amounts, not an eligibility or legal-deadline calculator. Your entries stay on this page.
No eligibility decision, official payslip or tax return is created.
Ten copy-ready exit-settlement messages
1. Request itemisation
Subject: Exit settlement — Request itemisation — [employee reference]
Hello HR / Payroll Team,
My confirmed last working day was [date], under approval reference [reference]. Please provide the unpaid wages, leave encashment, gratuity, incentive and reimbursement lines separately, with the basis and payment status of each.
I have attached the relevant approval or record for review. Please distinguish verified dues from any estimated or disputed item and advise the next action in writing. I am not treating an unverified amount as already agreed. Please acknowledge this request and identify any additional record needed for reconciliation.
Regards,
[Name / employee reference]2. Unpaid wages
Subject: Exit settlement — Unpaid wages — [employee reference]
Hello HR / Payroll Team,
My confirmed last working day was [date], under approval reference [reference]. Please confirm the unpaid wage period and payment status under the applicable Code on Wages section 17 provision.
I have attached the relevant approval or record for review. Please distinguish verified dues from any estimated or disputed item and advise the next action in writing. I am not treating an unverified amount as already agreed. Please acknowledge this request and identify any additional record needed for reconciliation.
Regards,
[Name / employee reference]3. Leave balance
Subject: Exit settlement — Leave balance — [employee reference]
Hello HR / Payroll Team,
My confirmed last working day was [date], under approval reference [reference]. Please share the eligible leave balance and the law or policy used for encashment, including the wage base and calculation period.
I have attached the relevant approval or record for review. Please distinguish verified dues from any estimated or disputed item and advise the next action in writing. I am not treating an unverified amount as already agreed. Please acknowledge this request and identify any additional record needed for reconciliation.
Regards,
[Name / employee reference]4. Gratuity determination
Subject: Exit settlement — Gratuity determination — [employee reference]
Hello HR / Payroll Team,
My confirmed last working day was [date], under approval reference [reference]. Please provide the gratuity eligibility decision and itemised calculation under the applicable coverage and service records.
I have attached the relevant approval or record for review. Please distinguish verified dues from any estimated or disputed item and advise the next action in writing. I am not treating an unverified amount as already agreed. Please acknowledge this request and identify any additional record needed for reconciliation.
Regards,
[Name / employee reference]5. Notice recovery
Subject: Exit settlement — Notice recovery — [employee reference]
Hello HR / Payroll Team,
My confirmed last working day was [date], under approval reference [reference]. Please identify the notice clause, unserved period, approved waiver or buyout and the basis for the proposed recovery.
I have attached the relevant approval or record for review. Please distinguish verified dues from any estimated or disputed item and advise the next action in writing. I am not treating an unverified amount as already agreed. Please acknowledge this request and identify any additional record needed for reconciliation.
Regards,
[Name / employee reference]6. Reimbursement
Subject: Exit settlement — Reimbursement — [employee reference]
Hello HR / Payroll Team,
My confirmed last working day was [date], under approval reference [reference]. Please confirm whether the approved expense claim under reference [reference] has been paid or included in this statement.
I have attached the relevant approval or record for review. Please distinguish verified dues from any estimated or disputed item and advise the next action in writing. I am not treating an unverified amount as already agreed. Please acknowledge this request and identify any additional record needed for reconciliation.
Regards,
[Name / employee reference]7. Tax withholding
Subject: Exit settlement — Tax withholding — [employee reference]
Hello HR / Payroll Team,
My confirmed last working day was [date], under approval reference [reference]. Please explain the withholding treatment for each payment and the tax year used in the payroll computation.
I have attached the relevant approval or record for review. Please distinguish verified dues from any estimated or disputed item and advise the next action in writing. I am not treating an unverified amount as already agreed. Please acknowledge this request and identify any additional record needed for reconciliation.
Regards,
[Name / employee reference]8. Incorrect exit date
Subject: Exit settlement — Incorrect exit date — [employee reference]
Hello HR / Payroll Team,
My confirmed last working day was [date], under approval reference [reference]. Please review the exit date shown in the settlement against the written release approval and correct the affected payroll period.
I have attached the relevant approval or record for review. Please distinguish verified dues from any estimated or disputed item and advise the next action in writing. I am not treating an unverified amount as already agreed. Please acknowledge this request and identify any additional record needed for reconciliation.
Regards,
[Name / employee reference]9. Partial settlement
Subject: Exit settlement — Partial settlement — [employee reference]
Hello HR / Payroll Team,
My confirmed last working day was [date], under approval reference [reference]. Please identify which components have been paid and which remain pending, with a separate reason and expected action for each.
I have attached the relevant approval or record for review. Please distinguish verified dues from any estimated or disputed item and advise the next action in writing. I am not treating an unverified amount as already agreed. Please acknowledge this request and identify any additional record needed for reconciliation.
Regards,
[Name / employee reference]10. Escalation record
Subject: Exit settlement — Escalation record — [employee reference]
Hello HR / Payroll Team,
My confirmed last working day was [date], under approval reference [reference]. I have requested reconciliation under reference [reference]. Please provide a written response so I can take the matter through the applicable internal or statutory process.
I have attached the relevant approval or record for review. Please distinguish verified dues from any estimated or disputed item and advise the next action in writing. I am not treating an unverified amount as already agreed. Please acknowledge this request and identify any additional record needed for reconciliation.
Regards,
[Name / employee reference]Worked settlement examples
| Case | Wages | Encashment | Gratuity | Reimbursement | Deductions | Net |
|---|---|---|---|---|---|---|
| Wages only | ₹20,000 | ₹0 | ₹0 | ₹0 | ₹1,000 | ₹19,000 |
| Wages plus eligible leave | ₹30,000 | ₹8,000 | ₹0 | ₹2,000 | ₹3,000 | ₹37,000 |
| Separate verified gratuity amount | ₹40,000 | ₹10,000 | ₹1,20,000 | ₹0 | ₹5,000 | ₹1,65,000 |
| Disputed recovery entered for comparison | ₹25,000 | ₹5,000 | ₹0 | ₹0 | ₹45,000 | −₹15,000; verify basis |
The final row illustrates a proposed recovery rather than proving that money is legally owed by the employee. Run a second calculation with the disputed item excluded to understand the disagreement. Preserve both versions and ask the employer to explain the basis. Do not sign a statement of full satisfaction until you understand which amounts are included, paid, disputed or expressly reserved.
Mistakes that delay a useful resolution
- Ask for wages separately instead of accepting one undifferentiated pending total.
- Do not use CTC as the automatic wage base for every benefit.
- Do not assume an employer provision proves gratuity eligibility.
- Do not treat a disputed notice recovery as an agreed deduction.
- Do not confuse the relieving letter with a payment receipt.
- Preserve approvals, attendance, expense records and payment acknowledgements.
If the employer refuses to explain an item, keep the request and response with the relevant records. The correct route may be the internal grievance process, the competent wage authority, the labour department or another forum depending on coverage and the issue. Ask an adviser to review the specific claim and documents rather than selecting a forum from a generic article. Do not publish confidential records or personal accusations as a substitute for an evidence-based claim.
Frequently asked questions
Does all F&F have to be paid in two working days?
Section 17(2) is a wages provision for the specified exit events. Other components require their own applicable rule and due date.
Is gratuity always payable after resignation?
Eligibility depends on statutory coverage, qualifying service and exceptions. Check section 53 against the actual employment record.
Does gratuity have a separate payment process?
Yes. Section 56 covers determination and payment, including its separate thirty-day payment provision and delay-interest conditions.
Can notice pay be deducted automatically?
Do not assume that every proposed recovery is lawful or agreed. Review the contract, approvals and applicable deduction rules.
What if leave encashment is missing?
Ask for the leave ledger and the law or policy used to decide eligibility. The calculator cannot establish the entitlement.
Should reimbursements be included?
Identify approved unpaid expenses separately and ensure they have not already been paid. Keep approval and payment records.
Is the calculator an official settlement?
No. It only adds and subtracts supplied amounts. An authorised statement and verified legal treatment are needed.
What if only part is paid?
Request the payment status and basis of every line separately. Keep the amount paid and the unresolved items clearly recorded.
Related MNC Insider guides
- relieving letter format
- experience letter format
- notice period buyout india
- resignation email sample india
Last verified on 7 October 2026. Official references are identified in Sources. Worked examples and message templates are editorial illustrations; they are not legal findings about an individual employer.
Sources
- Official: Labour codes implemented from 21 November 2025 — PIBGovernment commencement announcement. Accessed 7 October 2026.
- Official: Code on Wages, 2019 — India CodeSections 17(2), 18, 20 and 50. Accessed 7 October 2026.
- Official: Code on Social Security, 2020 — India CodeSections 53 and 56: gratuity. Accessed 7 October 2026.
- Official: Income-tax Act, 2025 — Income Tax DepartmentCommencement on 1 April 2026; payroll must use the applicable tax year. This page accepts actual TDS estimates rather than reproducing tax slabs. Accessed 7 October 2026.