What does an Employee Exit Policy mean?

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Employee Exit policy shows the handling of the full and final settlement of employees when they leave the organization. When the employee resigns, retires, or is being terminated from work, the necessary paperwork and formalities associated with employee exit need to be done via a systematic process. Exit interview, clearance from various departments, replacement of the departing employee, full and final settlement of employee dues, and more are the exit policy’s provisions. Regardless of the employee’s leaving situation, staying calm and professional will ensure a sleek transition for your company and keep doors open if any future encounters with the resigning employee develop.

For the employees offering a notice, authorities will need to decide if the employee remaining on-site for the time mentioned in the notice will be more productive or noxious to the company. If negative, the authorities can, with all respect, accept their resignation and show that for the benefit of the business operation, they will take it as effective immediately. The HR may pass on that they will pay them for the said notice period since they offered to work. If they don’t provide wages to the employee, they should understand that he or she can file an unemployment claim for the time they had offered to work through resignation but weren’t permitted.

In This Policy, You Will Get

  • The motive and scope of this sample policy.
  • Eligibility of the employees who fall under this policy.
  • The roles and responsibilities on the part of the employee.
  • The provisions regarding the exit of the employee.

Employee Exit Sample Policy

“Name of the Company” defines a policy that ensures an appropriate and impartial employee dismissal (retirement, resignation, end of the contract, etc.). “Name of the Company” believes that this will ensure that the employee will leave with dignity. Therefore, we believe that this is a precious organizational strength tool.


This policy describes the process to be obeyed when an employee parts with the company. It describes that the exit procedure must be transparent, so any miscommunication and suspicion can be sidestepped. During any employment termination process, factors such as professionalism, discretion, and formal documentation shall be followed in accordance with the laws.


The policy extends to all the working employees of the company, regardless of the job type, position, or location.


The termination of an employee from their job duties may be voluntary or involuntary.

Voluntary separation includes:

  • Resignation
  • Retirement
  • End of employment contract
  • Fail to appear without notice for a “predetermined period” days

Involuntary separation includes:

  • Discharge for any reason
  • Discharge without any reason


All the benefits will discontinue from the date of resignation or the last day. Compensatory leaves, if any, will not be encashed.

The PF account of the employee with the company will be laid off. If there is any third-party PF, it will stay the same. This is unless the employee chooses differently. Any such dealing will be between the employee and the third party.

If reimbursements are remaining, they should be filed before the notice period is finished.

The employee is expected to return all the company’s assets. This may include any technological device, company credit cards, vehicle, identity card, etc., before the day the notice period ends. Any behavior different from this rule may stop your termination process.

A letter will be issued by the company when the termination process is completed. To improve employee satisfaction, the human resource team may hold an exit interview. You are requested to co-operate and be sincere about the same.

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