Article · 12 min read

Full and Final Settlement (FnF): All You Need to Know

Razorpay Payroll · Razorpay Free Beginner India

The India-specific money mechanics of an exit, laid out by a payroll company that processes them daily. It itemizes exactly what a lawful FnF must include (pending salary, leave encashment, gratuity for 4 years 10 months plus, EPF, TDS handling) and the legal payment window, so you do not accidentally shortchange someone and invite a claim. This is the operational half the answer names: notice, full and final settlement, statutory dues.

  • FnF must bundle pending salary, unused leave encashment, gratuity, and PF; gratuity and leave encashment are TDS-exempt, most other components are not
  • Under the Payment of Wages framework, dues are expected within roughly a week to ten days of the last working day, delayed gratuity beyond 30 days accrues interest
  • If you skip or short the settlement, the employee can contest it and you become liable for interest as a penalty, so calculate it cleanly the first time
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The question it answers

  1. How do I let someone go the right way when a hire is not working out in a small team?

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