company's denial for payment in lieu of notice period

I am working with big private company.

I had clause in my appointment letter stating that I can buy out notice period and I was planning to tender my resignation today and buy out two month out of three month notice.

On giving my lettter to my manager, he showed me new policy (4 days old) stating, employee can not buy notice period and have to serve for full three month. I am in big fix - on side committed to new company for joining in month and here for serving three month notice.

The new company is not accepting things without final letter.

Please advice


In your case only  the  document sugned by you  is  valid.  All other later  amendments  on which you did not sign is not valid.   Either you have to convince  the new employer  or  old one.  If you are dare enough,  ask your new employer to accept  you without  demanding  relieving letter.  Becasue the old employer  is disputing.   If  agrees you  join and issue a  notice  to the old employer  for  settlement and to  provide relieving letter. 

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Thanks Venkat Sir.  Anyone in Mumbai can give consultancy so I can meet and discuss.

Manager - HR

Dear Mr. Venkat,

Please see the new policy carefully the date of enforcement. Normally this type of policie are not issuedto one to one. It should be either thro. departmental head or circular. If it is circular with immediate effect, you dont have option to argue. Orelse to thro HOD you can argue that my manager is not disclosed.

Or else, u may convince your immediate boss to stick on with the old policy as a special case.

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Dear Mr. Selvam - you are right

The policy carry 5 day old date on that and forwarded to me soon after sharing my resignation. It says "payment in lieu of notice period" is not possible. My manager & HOD are leaning towards policy and do not want to go against that.

Do I have any strong point on my side to state..

- Is it really fair to force someone to work with company - even if he/ she do not want to and compensate this with money ?

But obviously I do not want to fight with them.


Dear Member:

Your case is not that grave. 

Please read carefully your appointment letter.  By accepting your appointmment letter you are agreeing to abide by the rules and regulations of your employment of the company.  Now any change in the rules and service conditions are bound by you even after your appointment.  Since the changes are affecting you you are pained.  Think for the other side if they have enhanced the period to six months. What will be your reaction.

Now realising the reality make use of  your good offices with the present employer and find out a solution. Normally no employer wants a half hearted employee to continue in his service.  Contact your prospective employer and discuss the legality of the matter. No one will suggest you to take any illegal step.  God Bless You.




You should have receipt of your resignation with you with date ofits receipt clearly visible on it.

You may send your resignation to your appointing authority or Managing Director, and express your wilingness to to coperate with the company for smooth handover of the charge (specify a date within maximum of 1 month)and to pay the notice pay for the balance period. The good office of MD shall be able to provide the relief whcih your line manager is not willing to due to their limitations.

The new policy which is 5 days old is announced to you after your resignation as per  terms of employment in appointment letter is received by your company.

Usually the circulars/HR communications are supplied in big companies by emails/attatchments thru Dept Head and then line management on Pan india basis. You should keep copy of circulars safely to establish the practice.

You need the persuasive skills to explain the situation and convince the team at new company .

The team at new company is also aware of the trends in the industry, and problems of attrition/vavancies etc and can help you.

They can employ you on the basis of copy of the resignation,proof of its despatch,receipt/acknowledgment and may ask you to sign some documents/declaration.

You may also persuade and convince old company that beased on the exisiting terms of employment in your appointment letter you have finalised your new venture and you are willing to coperate with the company to handover the charge smoothly upto maximum of one month( specify the date)and by paying the notice pay for the balance period. You can provide the references for some good candidiates, to fill the vacancy with your exit.You should submit all company property under receipt.

Your line Management are leaning towards the 5 days old policy, since they have to or they shall face the compliance issues and If they have not supplied the policy in time they are at fault.

However you need them therefore mainatin good rapport.

With your efforts and facts you should be able to manage the situation.

You can consult your local lawyer with all the documents .




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