New Labor Code : The new labor code has been implemented in the country. Meanwhile, a significant change has occurred that is important for every employee. In fact, if you work for a company and then leave it, you will now receive a full settlement within just two days. This means that the money will be settled within two days of leaving the job.
Until now, it often took 40 to 45 days for employees to receive their dues after leaving or being fired, causing significant inconvenience. Even paying house rent or meeting monthly expenses was a challenge. However, this difficulty is about to end. Full settlement will now be made within two days. However, under certain conditions, settlement can still be extended for up to one month.
What is the new rule?
Under the new rule, effective April 1, 2026, companies will be required to complete full and final (FnF) settlements with employees within just two working days. This rule was implemented under the Code on Wages, 2019. Under the new law, if an employee quits, is fired, or the company closes, the company must clear all outstanding payments within two working days. Previously, this process took 30 to 90 days.
What is a full and final settlement?
Full and final settlement means the calculation and payment of all monies owed to an employee upon termination of employment. This includes not only salary but also other allowances and services.
What is included?
Last month’s salary as per working days
Remaining holiday money
Performance-based bonus or incentive money
Reimbursement of office-related expenses such as travel or other expenses
Deductions for non-return of taxes, advance salary, loans or company goods
When is gratuity paid?
A key change in the new labor code allows gratuity benefits to be paid after one year of service. Previously, gratuity was only paid after five years of service, but now employees will receive gratuity benefits after one year of service. Companies must pay gratuity within 30 days
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