New Delhi: From April 1, 2026, employees will no longer have to wait months to receive their dues after leaving a job. Under the new labour rules, companies must complete full and final (F&F) settlements within two working days of the employee’s last working day.
Earlier, this process could take 45 to 90 days. Now, all pending payments such as salary, leave encashment, and other dues must be cleared quickly. If companies fail to follow this rule, it may be treated as a legal violation, and employees can take action or even claim interest on delays.
Changes In Gratuity Rules
The new framework also updates gratuity rules. Earlier, employees had to complete five continuous years of service to qualify. Now, in certain cases, employees may become eligible after just one year of service.
Once eligible, the employer must release gratuity within 30 days of the employee’s exit. This makes the process faster and more beneficial for employees.
Salary Structure Gets A Big Shift
Another major change is in salary structure. The new rules require that basic salary must be at least 50% of the total cost to company (CTC).
This means provident fund (PF) contributions will increase, as PF is calculated on basic pay. Gratuity amounts will also rise over time. However, because of higher deductions, monthly take-home salary may reduce slightly.
On average, employees may see a 2% to 5% drop in in-hand salary, even though long-term savings improve.
Impact On Companies And Hiring
Companies will also feel the impact of these changes. Sectors like IT, BPO, and retail, where basic salaries are usually lower, may see higher costs.
Employers may have to spend 5% to 15% more due to increased PF and gratuity contributions. This could affect hiring plans, salary hikes, and overall compensation strategies.
What Employees Should Do Before Resigning?
Employees planning to switch jobs should be careful. Completing the notice period is important, as any shortfall can still be deducted from final payments.
It is also advisable to submit all tax proofs and documents on time. Checking whether your company has updated its payroll system can help avoid confusion and delays.
Overall, the new labour rules aim to make payments faster, improve benefits, and bring more transparency to the system.
