An employee abandoned employment after 04.05.2026 without serving the notice period. The company has adjusted wages for 01.05.2026 to 04.05.2026 against notice pay recovery and no amount is payable to the employee.
In such a case:
Is PF/ESI contribution required on the wages adjusted against notice pay recovery?
Should the PF and ESI Date of Exit be 04.05.2026 or 30.04.2026?
PF/ESI Contributions: Do not apply to notice pay recovery, as this is a compensatory deduction, not earned wages.
Date of Exit: Should be recorded as the actual last day of employment (04 - May - 2026), reflecting the period the employee was on the payroll.
Karia Overseas
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CAclubindia
