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Notice Period Buyout Calculator

Calculate shortfall days, gross buyout recovery, and leave adjustments.

₹
Check contract terms: Some employers recover on Basic Salary, others on Gross Pay.
Contractual notice period.
Days worked post-resignation.
Leaves offset against notice.
F&F Recovery Assessment
Indian Contract Law
Total Buyout Recovery Cost
₹1,00,000
Contractual Shortfall Days 60 Days
Leave Offset Credit Applied - 10 Days (₹20,000 Saved)
Net Billable Shortfall Days 50 Days
Daily Recovery Rate ₹2,000 / Day
Per-Day Calculation Formula Monthly Pay / 30 Days

How Notice Period Buyout Works in India

Under Indian employment jurisprudence and Section 74 of the Indian Contract Act 1872, an employment agreement may stipulate notice period pay in lieu of actual service. If an employee resigns and desires an early exit, the employer may adjust the unserved shortfall days in the Full and Final (F&F) settlement:

Gross Shortfall = Required Notice Days − Days Actually Served
Net Shortfall = Gross Shortfall − Approved Leave Offset Days
Total Buyout Cost = Net Shortfall × (Monthly Salary / 30 or 26)

Can an Employer Refuse a Notice Buyout?

Yes. A buyout clause in an appointment letter is generally a discretionary mutual option, not an absolute unilateral right of the employee. If business continuity or project handover requires your physical presence, the employer is legally permitted to insist that you serve the notice period.

Can an Employer Withhold Relieving Letters for Unpaid Buyout?

Indian High Courts (including Bombay and Delhi High Courts) have held that proof of service (Experience Certificate / Relieving Letter) cannot be illegally withheld as a tool of coercion. The employer's lawful remedy is recovering liquidated shortfall damages through civil process or F&F adjustments.