Laid Off? Calculate Your Full Payout
Notice pay, severance, gratuity and leave encashment in one estimate, and how many months of runway it gives you.
Showing example numbers. Replace them with yours from your payslip and separation letter.
From your payslip
Before tax and PF
0–11
If you're not serving notice
From your separation letter
Any flat months on top
Shows how many months the payout covers
Estimated total payout (before tax)
₹5,35,538
Notice pay
2 months of gross pay in lieu of notice
₹2,80,000
Severance
2 weeks per year × 3.6 yrs
₹2,31,538
Gratuity
Not yet eligible: needs 5 years of service, you have 3.6
₹0
Leave encashment
12 days × basic ÷ 30 (policies vary)
₹24,000
Estimate only, before tax. Gratuity follows the Payment of Gratuity Act formula. Your separation letter and company policy decide the actual amounts. Not legal or tax advice.
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A layoff email usually arrives with a separation letter full of line items and very little time to read it. Before you sign anything, it helps to know what each part should come to: notice pay if you aren't serving your notice, the severance formula, gratuity once you've crossed five years, and encashment of the leave you never took. Then work out how long that money lasts, and start the search while it still does.
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Create My Free ProfileFrequently asked questions
How is severance pay calculated in India?
Most tech companies in India calculate severance as a number of weeks of pay per completed year of service, set in the separation letter, often on top of notice pay if you're not asked to serve your notice. Add gratuity if you've completed five years, plus encashment of unused earned leave, and you have the full payout. The calculator above adds these up from your own numbers.
Is severance pay mandatory in India?
Not as a general rule for most private-sector software engineers. Indian labour law sets a retrenchment-compensation floor of 15 days' average pay for every completed year of service, but it applies to employees classed as "workmen", and engineers in managerial or supervisory roles usually aren't. Gratuity (after five years) and your contractual notice period apply regardless. Anything beyond that is company policy. This is general information, not legal advice.
How is gratuity calculated on a layoff?
Under the Payment of Gratuity Act, gratuity is your last drawn basic salary (plus dearness allowance, if any) × 15 ÷ 26 × completed years of service, where a final part-year of more than six months counts as a full year. It's payable once you've completed five years of continuous service, and the statutory maximum is ₹20 lakh.
Is severance pay taxable in India?
Generally, yes. Notice pay and ex-gratia severance are usually taxed as salary income. Gratuity is exempt up to ₹20 lakh for private-sector employees, and leave encashment on leaving a job is exempt up to a limit set by the Income Tax Act. Rules depend on how your employer classifies each component, so check your full-and-final settlement statement or ask a tax professional.
What should I ask HR after being laid off?
Ask for the payout breakdown in writing: notice pay, severance formula, gratuity, leave encashment and the date of your full-and-final settlement. Also ask when you'll get your relieving and experience letters, whether health insurance continues for any period, what happens to unvested ESOPs or RSUs, and whether there's outplacement or referral support.
How long does it take to find a new job after a layoff?
It varies widely with role, seniority and market conditions, so plan with your own runway rather than an average. Start applying in the first week while your notice pay is still in the bank, and use the monthly-expenses field above to see exactly how many months your payout covers.