Absconding Employees Under India's New Labour Codes: Legal Rights, Employer Obligations and Remedies (2026)

Introduction

Employee absenteeism without prior notice is a common challenge faced by employers across industries. An employee may suddenly stop reporting to work, fail to respond to calls or emails, and leave the organisation uncertain about their employment status.

In such circumstances, employers often classify the employee as an absconder. However, does unexplained absence automatically amount to abandonment of employment? Can an employer terminate an employee without providing an opportunity to explain? Can pending salary or gratuity be withheld?

The introduction of India's four Labour Codes has significantly reshaped the statutory framework governing employment relationships.

The Code on Wages, 2019, the Industrial Relations Code, 2020, the Code on Social Security, 2020, and the Occupational Safety, Health and Working Conditions Code, 2020 came into force on 21 November 2025. The Industrial Relations (Central) Rules, 2026 and Model Standing Orders, 2026 subsequently took effect on 8 May 2026.

This article examines the legal implications of employee absconding, the responsibilities of employers, and the remedies available to employees under the updated labour framework.

1. What Does Absconding Mean Under Employment Law?

Interestingly, the Labour Codes do not specifically define the term "absconding".

In employment practice, absconding generally refers to a situation where an employee remains continuously absent from work without:

Applying for or obtaining leave.
Submitting a formal resignation.
Informing the employer about the reason for absence.
Responding to official communications.
Providing any reasonable explanation for not reporting to work.

The applicable employment conditions are generally determined by:

The appointment letter or employment agreement.
Certified Standing Orders or applicable Model Standing Orders, 2026.
The organisation's HR and attendance policies.
Applicable State Shops and Establishments legislation.

An important legal distinction: Absence is not automatically abandonment.

An employee's failure to attend work establishes unauthorised absence, but it does not necessarily establish an intention to permanently abandon employment.

An employer should examine the surrounding circumstances and provide the employee with a reasonable opportunity to explain before taking adverse disciplinary action.

2. What Has Changed Under the New Labour Codes?

A. Standing Orders Under the Industrial Relations Code, 2020

The Industrial Relations Code, 2020 has replaced the Industrial Employment (Standing Orders) Act, 1946.

Under the updated framework, the requirement for mandatory standing orders generally applies to industrial establishments employing 300 or more workers.

The Model Standing Orders, 2026 address important employment matters, including:

Attendance and working hours.
Leave and absence.
Misconduct and disciplinary proceedings.
Suspension.
Termination of employment.

Habitual absenteeism may constitute misconduct under the applicable standing orders. Unauthorised absence may also result in lawful wage deductions under the Code on Wages.

B. Rules Applicable to Smaller Establishments

Establishments employing fewer than 300 workers are generally not required to obtain certified standing orders under the IR Code.

However, employers must still comply with applicable employment contracts, written HR policies and relevant State Shops and Establishments legislation.

A clearly documented absence and disciplinary policy is important for preventing employment disputes.

C. Two-Working-Day Wage Settlement Requirement

Section 17(2) of the Code on Wages, 2019 provides for payment of wages within two working days following removal, dismissal, retrenchment or resignation.

In an absconding case, the employer should formally determine the employment separation through an appropriate documented process and release the applicable wage dues within the prescribed period.

An employer should not keep an employment separation pending indefinitely merely to avoid settling earned wages.

D. Gratuity Rights of Employees

The Code on Social Security, 2020 provides gratuity eligibility to fixed-term employees after one year of continuous service, subject to the applicable statutory conditions.

For permanent employees, the general qualifying period remains five years, subject to statutory exceptions.

Gratuity already earned cannot be forfeited merely because an employee has remained absent without authorisation.

Forfeiture is permissible only on specific statutory grounds, such as certain acts involving damage to employer property, riotous or disorderly conduct, or an offence involving moral turpitude, subject to the applicable legal requirements.

3. Legal Procedure an Employer Should Follow Before Declaring an Employee Absconding

An employer should follow a fair, documented and transparent procedure before treating an employee as an absconder or terminating their employment.

Step 1: Initial Communication

During the initial days of unexplained absence, the employer should:

Attempt to contact the employee through telephone calls.
Send messages and emails.
Contact the emergency contact, where appropriate.
Check whether the employee is facing a medical emergency, accident or family crisis.

Step 2: Maintain Accurate Attendance Records

The employer should correctly record the employee's attendance as unauthorised absence wherever applicable.

Attendance records must not be manipulated or retrospectively changed to create a false record of resignation or abandonment.

Step 3: Issue the First Written Notice

The employer should send a formal communication to the employee's registered residential address and official and personal email addresses.

The notice should:

Identify the period of unauthorised absence.
Ask the employee to report to work or explain the circumstances.
Provide a reasonable response period, commonly seven days.
Explain the possible consequences of continued non-response.

The employer should preserve proof of delivery and communication.

Step 4: Issue a Show-Cause Notice

If the employee does not respond, the employer may issue a show-cause notice.

The notice should clearly explain the allegations and provide a final reasonable opportunity to respond before disciplinary action is considered.

Step 5: Conduct a Domestic Inquiry, Where Applicable

Where applicable standing orders or employment rules require a domestic inquiry, the employer should conduct proceedings in accordance with the prescribed procedure.

If the employee does not participate despite proper notice, the employer may proceed ex parte, subject to the applicable requirements, and carefully document the proceedings.

The principles of natural justice must be respected.

Step 6: Issue a Reasoned Separation or Termination Order

After following the applicable procedure, the employer should issue an appropriate written order.

The order should record:

The decision taken.
The reasons for the decision.
The effective date of separation.
The applicable settlement process.

Step 7: Process Full and Final Settlement

The employer should calculate and release applicable wage dues within the statutory timeline.

Other dues, including provident fund and gratuity, should be processed according to their respective statutory requirements.

4. Common Legal Mistakes Employers Should Avoid

Employers should avoid the following practices:

1. Automatic Termination Without an Opportunity to Explain

An employer should not mechanically rely on an automatic abandonment clause without considering the employee's circumstances and providing a reasonable opportunity to respond.

2. Withholding Earned Salary

Earned wages cannot be withheld indefinitely merely because an employee has been classified as an absconder.

Any deduction for notice pay or other recoveries must be legally permissible and supported by the applicable employment terms.

3. Withholding Relieving or Service Documents

Employers should not use basic employment documents as pressure tactics to force employees to settle disputed claims.

4. Publicly Blacklisting Employees

Publishing an employee's name on public blacklists or circulating allegations without proper justification may expose an organisation to defamation and privacy-related claims.

5. Filing Unnecessary Police Complaints

Absence from work is ordinarily an employment-related matter, not automatically a criminal offence.

A police complaint may be appropriate where there is an independent criminal allegation, such as theft, misappropriation or failure to return company property involving genuine criminal circumstances.

5. What Should an Employee Do If Accused of Absconding?

Employees facing absconding allegations should act promptly to protect their employment records and legal rights.

The following steps are recommended:

Respond to every official notice in writing.
Explain the circumstances responsible for the absence.
Submit supporting medical or other relevant documents wherever applicable.
If the intention is to leave employment, submit a formal resignation.
Address the applicable notice-period obligations under the employment agreement.
Return company property and obtain written acknowledgement.
Preserve emails, messages, attendance records and salary documents.
Request the applicable full and final settlement and employment documents.

If an employee is terminated without following the applicable legal procedure, an eligible worker may explore remedies under the Industrial Relations Code, 2020.

Claims relating to unpaid wages may also be pursued before the appropriate authority under the Code on Wages, 2019.

6. Employer Compliance Checklist

Organisations should consider the following measures to minimise employment disputes:

Clearly define absconding and unauthorised absence in written HR policies.
Specify the applicable consecutive absence period and communication procedure.
Align standing orders with the Model Standing Orders, 2026 wherever applicable.
Maintain updated employee contact details and emergency contacts.
Preserve attendance records, notices and communication evidence.
Train managers to report unexplained absence promptly.
Follow the applicable disciplinary procedure.
Ensure timely payment of wage dues and other statutory benefits.

7. Frequently Asked Questions (FAQs)

Q1. After how many days of absence can an employee be declared absconding?

There is no single period prescribed universally by the Labour Codes. Employment contracts, applicable standing orders and HR policies may specify the relevant period. Many organisational policies use approximately seven to ten consecutive days of unauthorised absence before initiating formal action.

Q2. Can an employer terminate an absconding employee without issuing a notice?

An employer should not mechanically terminate an employee without providing a reasonable opportunity to explain the absence. Written communication and compliance with applicable disciplinary procedures are important.

Q3. Is an employer required to pay full and final settlement within two working days?

Section 17(2) of the Code on Wages, 2019 provides a two-working-day timeline for payment of applicable wages following removal, dismissal, retrenchment or resignation. Other components of the final settlement may be governed by their respective statutory timelines.

Q4. Can an employer deduct notice-period salary from the employee's final settlement?

Notice-pay recovery may be permissible where supported by the employment contract and applicable law. However, arbitrary or excessive deductions may be challenged before the appropriate authority.

Q5. Can an employee lose gratuity because of absconding?

Generally, no. Unauthorised absence by itself is not a statutory ground for forfeiting gratuity already earned. Forfeiture is permissible only in circumstances recognised by law.

Q6. Can an employer file a police complaint against an absconding employee?

A police complaint is not justified merely because an employee has stopped attending work. However, independent allegations involving theft, misappropriation or other criminal conduct may warrant appropriate legal action.

Q7. Will absconding affect future background verification (BGV)?

It can. A previous employer may report the employee's separation status during background verification. Resolving the matter formally and obtaining written separation records can help avoid unnecessary complications.

Q8. Is a domestic inquiry mandatory before dismissing an absconding employee?

Where applicable certified or Model Standing Orders require an inquiry, the employer must follow the prescribed disciplinary procedure. In other cases, a documented opportunity to explain is strongly advisable.

Q9. What happens if an employee returns after receiving a termination letter?

The employer may examine the employee's explanation and decide whether to reconsider the separation, accept a resignation or maintain the termination, subject to applicable law. The decision should be properly documented.

Q10. Do these rules apply to managers and senior employees?

Managerial and certain supervisory employees may fall outside the definition of a worker under the Industrial Relations Code. Their employment matters are generally governed by their employment contracts and applicable State Shops and Establishments legislation, subject to the relevant statutory framework.

Conclusion

Absconding is not simply a matter of an employee failing to report to work. It involves important questions concerning employment contracts, disciplinary procedures, natural justice, wage entitlements and statutory compliance.

Under India's updated Labour Codes, employers should maintain clear policies, issue appropriate notices, provide employees with a fair opportunity to explain and ensure timely settlement of applicable dues.

Similarly, employees should avoid remaining silent when facing employment difficulties. Written communication, supporting documentation and proper separation procedures can significantly reduce the risk of future employment disputes.

At LexSphere, we believe that awareness of employment law is essential for protecting both employer interests and employee rights.