Notice period, early release and buyout explained

In many Indian companies, especially in IT, a notice period of 60 or 90 days is normal. That means a job switch can take three months from the day you resign, and some employers will not wait that long. Understanding how notice periods, early release and buyouts work helps you plan your move and negotiate with both your current and your new employer.

What a notice period is

A notice period is the time you agree to keep working after you resign, so your employer can find a replacement and you can hand over your work. It is set out in your offer letter, appointment letter or company policy, and it usually differs by stage:

• During probation: often shorter, commonly 15 to 30 days, and sometimes as little as a week.
• After confirmation: commonly 30, 60 or 90 days, with longer periods more typical for senior roles.

Check whether your notice period counts from the day you submit your resignation or the day it is accepted, and whether it is counted in calendar days or working days. The policy document will say.

Why new employers care

Hiring managers want people to start quickly. Many prefer candidates who can join within 30 days, and some roles are advertised for immediate joiners only. A long notice period does not rule you out, but it can count against you when two candidates are otherwise equal. That is why recruiters ask about it on the first call, and why it helps to know your options.

Ways to shorten your notice period

Ask for an early release

Your manager can often agree to release you early, especially if your work can be handed over quickly. Your chances improve if you:

• Offer a clear handover plan with dates.
• Document your work and train a colleague.
• Ask at a sensible time, not during a critical release.
• Stay polite and flexible. An early release is a favour, not a right.

Some companies also allow unused leave to be adjusted against the notice period. This depends entirely on company policy, so ask HR.

Buy out the notice period

Many companies allow you to pay for the days you do not serve. This is called a notice buyout. The amount is usually calculated on your basic salary or your gross salary, depending on the policy, and is normally deducted from your final settlement.

For example, suppose your notice period is 90 days, you serve 45 days, and the policy uses basic salary. If your basic salary is ₹40,000 a month, the buyout for the remaining 45 days would be roughly ₹60,000. If the policy uses gross salary, the amount would be considerably higher. Always ask HR for the calculation in writing.

Some new employers will reimburse the buyout amount to get you sooner. It is reasonable to ask: "My notice period is 90 days, but I can join in 30 if the buyout is covered. Would that be possible?"

Garden leave

Occasionally, an employer asks you to stop working immediately but keeps you on the payroll until the notice period ends, often when you are joining a competitor. This is called garden leave. It is uncommon in India, but if it happens, you remain an employee until your last day and cannot start the new job before then.

Do not simply walk out

Leaving without serving your notice or agreeing a buyout is sometimes called absconding. The consequences can include not receiving your relieving letter, deductions or recovery claims against your final settlement, and a negative result when your next employer runs a background check. Since most employers ask for a relieving letter, absconding can follow you for years. Whatever your situation, agree your exit in writing.

Negotiating your joining date

• Be upfront about your notice period from the first conversation. Surprising an employer after the offer damages trust.
• Give a realistic date, then keep the employer updated if anything changes.
• Ask whether they will wait or support a buyout. Many will, for the right candidate.

Accepting offers during your notice period

It is common in India for candidates to keep interviewing during their notice period and use a later offer to negotiate. If you do, be honest and professional. Accepting an offer and then backing out at the last minute, or not turning up on joining day, damages your reputation with that company and the recruiters involved, and some employers have started to share such information. If you change your mind, tell the employer as early as possible.

A checklist before you resign

• You have a signed offer letter from your new employer.
• You know your exact notice period and the buyout rules in your policy.
• You have estimated your buyout cost, if you plan to use one.
• You know your leave balance and whether it can be adjusted or encashed.
• You have copies of your personal documents, such as payslips and appraisal letters. Do not take any confidential company data.
• You have a draft handover plan.

When you are ready, read how to resign professionally. For what happens at the end of your notice period, see our guide to relieving letters and full and final settlement.

This article is general information, not legal advice. Your employment contract and company policy decide the rules that apply to you.