(1) For terminating employment of a permanent worker, for any reason other than misconduct, one month‟s notice shall be given either by the employer or the worker. One month‟s wages calculated on the basis of average wages earned by the worker during the last three months shall be paid in lieu of notice.
(2) No temporary worker, whether monthly-rated, weekly-rated, dailyrated or piece-rated, and no probationer, badly or contract worker shall be entitled to any notice, if his services are terminated by the employer, nor shall any such worker be required to give any notice or pay any wages in lieu thereof to the employer if he leaves employment of his own accord.
(3) The services of a worker shall not be terminated, nor shall a worker be removed, retrenched, discharged or dismissed from service, except by an order in writing which, shall explicitly state the reason for the action taken. In case a worker is aggrieved by the termination of his services or removal, retrenchment, discharge or dismissal, he may take action in accordance with the provisions of section 37 of the Khyber Pakhtunkhwa Industrial Relations Act, 2010 (Khyber Pakhtunkhwa Act No. XVI of 2010) and thereupon the provisions of the said section shall apply as they apply to the redress of an individual grievance.
(4) Where the services of any worker are terminated, the wages earned by him and other dues, including payment for unavailed leaves as defined in sub-clause (1) of clause 10 shall be paid before the expiry of the second working day from the day on which his services are terminated.
(5) The services of a permanent or temporary worker shall not be terminated on the ground of misconduct otherwise than in the manner prescribed in clause 21.
(6) Where a worker resigns from service or his services are terminated by the employer, for any reason other than misconduct, he shall, in addition to any other benefit to which he may be entitled under this Act or in accordance with the terms of his employment or any custom, usage or any settlement or an award of a Labour Court under the Industrial Relations Act, 2010 (Khyber Pakhtunkhwa Act No. XVI of 2010) be paid gratuity equivalent to thirty days wages, calculated on the basis of the wages admissible to him in the last month of service if he is a fixed-rated worker or the highest pay drawn by him during the last twelve months if he is a piece-rated worker, for every completed year of service or any part thereof, in excess of six months: Provided that, where the employer has established a provident fund to which the worker is a contributor and the contribution of the employer to the provident fund, shall not be less than the contribution made by the worker, no such gratuity shall be payable for the period during which such provident fund has been in existence: Provided further that amount paid to the worker under provident fund shall not be less than the amount of gratuity admissible to such worker under this Act:
(7) A worker shall be entitled to receive the amount standing to his credit in the provident fund, including the contributions of the employer to such fund, even if he resigns or is dismissed from service.
(8) Where a worker dies while in service of the employer, his dependant shall be paid gratuity in accordance with the provision of sub-clause (6): Provided that no payment of gratuity in such case shall be made otherwise than by a deposit with the Commissioner, who shall proceed with the allocation of the deposit to the dependant of the deceased in accordance with the provisions of section 8 of the Workmen's Compensation Act, 1923, (Act No. VIII of 1923).
(9) If the employer fails to deposit the amount of the gratuity under subclause (8) the dependant of the deceased may make an application to the Commissioner for the recovery of the amount thereof. Explanation.---“Commissioner” and “dependant” in this clause shall have the same meanings as are respectively assigned to them in the Workmen's Compensation Act, 1923, (Act No. VIII of 1923).
(10) If a worker is not allowed to work or mark his attendance by his employer in any manner, the worker may bring the same into the notice of the area Inspector in writing within ten days of the incidence and in such case the employer shall be precluded to initiate any action against the worker.

Every permanent worker shall be entitled to a service certificate at the time of his dismissal, discharge, retrenchment or retirement from service.