Notice period buy-outs are quite a common practice today with organizations who are hiring a new employee or the employee themselves can buy out the notice period of the employee they are hiring. You can choose to set up Notice Period Buyout policies for your employees so that their new employers can buy out their notice periods while they are in their exit process.
Here's how you can set up and manage your notice period buyout policies.
To manage your notice period buyout policies, Navigate to Payroll (1) and then select the Settings (2) tab. Go to the Notice Period Buyout tab (3).
On the Notice Period Buyout screen, you can add a new notice period buyout policy or manage the existing ones. To add a new policy, click on the Add Buyout Policy (4) screen.
On the Add Buyout Policy screen, enter the Name of the Policy, and the Calculation Expression to calculate the per day value which will be applicable to organizations looking to buyout the employee's notice period.
You can define a formula using some of the existing salary components. To add a salary component, you can type it in or use the +Existing Salay Component and select the component you want to add, and add the formula you want to add.
After you've added the necessary details, click Save.
While putting in the formula for a component, make sure that you're using the 'Standard JavaScript' notation for formula expressions. For example, use the asterisk symbol ( * ) for multiplication and forward slash ( / ) for division. Also, all the names of the components used in the formula should be enclosed in square brackets like [CTC], and only outside this the curved bracket should be used for arithmetic operations. Another thing to keep in mind while putting in the formulas is that you should follow the order of operations, which is also known as BODMAS (Brackets, Orders, Division, Multiplication, Addition, and Subtraction).
You can now see the policies you've added on the Notice Period Buyout page. You can edit or delete these policies as you wish from this page.
To edit a policy that you've configured, click on the Edit (1) icon corresponding to the policy you want to edit. You can make changes to the policy name and the calculation expression on the Edit Buyout Policy page.
Or, you can delete a particular policy by clicking on the Delete (1) icon corresponding to the buyout policy. Confirm the deletion by clicking Delete on the Delete Buyout Policy page.
That's all there's to know about configuring notice period buyout policies. More questions? Let us know and we will be glad to help you out!