Pay Salary, Full & Final Settlement Within Two Days Of Resigning: New Wage Code

After a four-day work week proposal, the new wage code states that a company must pay the full and final settlement of wages and dues within two days of an employee's last working day following their resignation, dismissal, or removal from employment and services.

The current common practice followed by organisations is to pay the complete settlement of salary and dues after 45 days to 60 days from an employee's last working day, and in some cases, it goes up to 90 days.

The new reform already passed by the Parliament comprise pay, social security, labour relations, occupational safety, health, and working conditions.

The new wage code under the labour law says, "Where an employee has been - (i) removed or dismissed from service; or (ii) retrenched or has resigned from service, or became unemployed due to closure of the establishment, the wages payable to him shall be paid within two working days of his removal, dismissal, retrenchment or, as the case may be, his resignation." 

The four new labour codes were formed by reviewing and combining the previous 29 Central labour laws.