Dear All, Kindly check the attachment file on retrenchment compensation calculation which is used in our establishment. Experts your views will be highly appreciated.
From India, Bhubaneswar
134From India, Bhubaneswar
Dear abedeen7,
The attachment is Perfectly Fine. i will recommend everybody should follow this calculation to avoid any legal problem related to Retrenchment.
Thanks dear for such a value add to the discussion.
From India, New Delhi
Dear Sir,
Pls excuse me, I am not agree with your comment (
One more suggestion if you are not paying your daily rated employees, the payment for weekly off please start paying it to avoid any unfavorable situation or pay them off daily end of day on voucher their wages for the day.)
you may be right as per shopes & Establishment Act,but concern to Factory Act it might be differant.
If you have any GR regarding w-off payable to daily rated worker kindly share with us.
Please clarify.
waiting reply from Madhu,Kaushik & Banerjee sir
Regards
Sacheein
From India, Mumbai
Pls excuse me, I am not agree with your comment (
One more suggestion if you are not paying your daily rated employees, the payment for weekly off please start paying it to avoid any unfavorable situation or pay them off daily end of day on voucher their wages for the day.)
you may be right as per shopes & Establishment Act,but concern to Factory Act it might be differant.
If you have any GR regarding w-off payable to daily rated worker kindly share with us.
Please clarify.
waiting reply from Madhu,Kaushik & Banerjee sir
Regards
Sacheein
From India, Mumbai
Dear Sacheein
The provision related to payment of wages for holiday are nearly same in both the Acts be it Shops and Establishment Act or Factories Act. Even in Factories Act there is Much Clear provision and without any ambiguity. Relevant provisions are Produced hereafter for your Satisfaction:
(l) “worker” means a person 6[employed, directly or by or through any agency (including a contractor) with or without the knowledge of the principal employer, whether for remuneration or not], in any manufacturing process, or in cleaning any part of the machinery or premises used for a manufacturing process, or in any other kind of work incidental to, or connected with, the manufacturing process, or the subject of the manufacturing process 5[but does not include any member of the armed forces of the Union];
As per the Definition above the daily wager are also covered in it as it clearly says any type of person whether employed for wages or not are worker under this act
Now lets Examine the provision for wages for leave:
79. Annual leave with wages.—(1) Every worker who has worked for a period of 240 days or more in a factory during a calendar year shall be allowed during the subsequent calendar year, leave with wages for a number of days calculated at the rate of—
(i) if an adult, one day for every twenty days of work performed by him during the previous calendar year;
(ii) if a child, one day for every fifteen days of work performed by him during the previous calendar year.
Explanation 1.—For the purpose of this sub-section—
(a) any days of lay off, by agreement or contract or as permissible under the standing orders;
(b) in the case of a female worker, maternity leave for any number of days not exceeding twelve weeks; and
(c) the leave earned in the year prior to that in which the leave is enjoyed,
shall be deemed to be days on which the worker has worked in a factory for the purpose of computation of the period of 240 days or more, but he shall not earn leave for these days.
Explanation 2.—The leave admissible under this sub-section shall be exclusive of all holidays whether occurring during or at either end of the period of leave.
(2) A worker whose service commences otherwise than on the first day of January shall be entitled to leave with wages at the rate laid down in clause (i) or, as the case may be, clause (ii) of sub-section (1) if he has worked for two-thirds of the total number of days in the remainder of the calendar year.
1[(3) If a worker is discharged or dismissed from service or quits his employment or is superannuated or dies while in service, during the course of the calendar year, he or his heir or nominee, as the case may be, shall be entitled to wages in lieu of the quantum of leave to which he was entitled immediately before his discharge, dismissal, quitting of employment, superannuation or death calculated at the rates specified in sub-section (1) even if he had not worked for the entire period specified in sub-section (1) or sub-section (2) making him eligible to avail of such leave, and such payment shall be made—
(i) where the worker is discharged or dismissed or quits employment, before the expiry of the second working day from the date of such discharge, dismissal or quitting; and
(ii) where the worker is superannuated or dies while in service, before the expiry of two months from the date of such superannuation or death.]
(4) In calculating leave under this section, fraction of leave of half a day or more shall be treated as one full day’s leave, and fraction of less than half a day shall be omitted.
(5) If a worker does not in any one calendar year take the whole of the leave allowed to him under sub-section (1) or sub-section (2), as the case may be, any leave not taken by him shall be added to the leave to be allowed to him in the succeeding calendar year:
Provided that the total number of days of leave that may be carried forward to a succeeding year shall not exceed thirty in the case of an adult or forty in the case of a child:
Provided further that a worker, who has applied for leave with wages but has not been given such leave in accordance with any scheme laid down in sub-sections (8) and (9) 2[or in contravention of sub-section (10)] shall be entitled to carry forward the 3[leave refused] without any limit.
(6) A worker may at any time apply in writing to the manager of a factory not less than fifteen days before the date on which he wishes his leave to begin, to take all the leave or any portion thereof allowable to him during the calendar year:
Provided that the application shall be made not less than thirty days before the date on which the worker wishes his leave to begin, if he is employed in a public utility service as defined in clause (n) of section 2 of the Industrial Disputes Act, 1947 (14 of 1947):
Provided further that the number of times in which leave may be taken during any year shall not exceed three.
(7) If a worker wants to avail himself of the leave with wages due to him to cover a period of illness, he shall be granted such leave even if the application for leave is not made within the time specified in sub-section (6); and in such a case wages as admissible under section 81 shall be paid not later than fifteen days, or in the case of a public utility service not later than thirty days from the date of the application for leave.
(8) For the purpose of ensuring the continuity of work, the occupier or manager of the factory, in agreement with the Works Committee of the factory constituted under section 3 of the Industrial Disputes Act, 1947 (14 of 1947), or a similar Committee constituted under any other Act or if there is no such Works Committee or a similar Committee in the factory, in agreement with the representatives of the workers therein chosen in the prescribed manner, may lodge with the Chief Inspector a scheme in writing whereby the grant of leave allowable under this section may be regulated.
(9) A scheme lodged under sub-section (8) shall be displayed at some conspicuous and convenient places in the factory and shall be in force for a period of twelve months from the date on which it comes into force, and may thereafter be renewed with or without modification for a further period of twelve months at a time, by the manager in agreement with the Works Committee or a similar Committee, or as the case may be, in agreement with the representatives of the workers as specified in sub-section (8), and a notice of renewal shall be sent to the Chief Inspector before it is renewed.
(10) An application for leave which does not contravene the provisions of sub-section (6) shall not be refused, unless refusal is in accordance with the scheme for the time being in operation under sub-sections (8) and (9).
(11) If the employment of a worker who is entitled to leave under sub-section (1) or sub-section (2), as the case may be, is terminated by the occupier before he has taken the entire leave to which he is entitled, or if having applied for and having not been granted such leave, the worker quits his employment, before he has taken the leave, the occupier of the factory shall pay him the amount payable under section 80 in respect of the leave not taken, and such payment shall be made, where the employment of the worker is terminated by the occupier, before the expiry of the second working day after such termination, and where a worker who quits his employment, on or before the next pay day.
(12) The unavailed leave of a worker shall not be taken into consideration in computing the period of any notice required to be given before discharge or dismissal.
Dear this is a very wide definition which clears the provision as well as it specifies each Scenario possible. Also produced here the provision related to Weekly off in a Factory.
52. Weekly holidays.—(1) No adult worker shall be required or allowed to work in a factory on the first day of the week (hereinafter referred to as the said day), unless—
(a) he has or will have a holiday for a whole day on one of the three days immediately before or after the said day, and
(b) the manager of the factory has, before the said day or the substituted day under clause (a), whichever is earlier,—
(i) delivered a notice at the office of the Inspector of his intention to require the worker to work on the said day and of the day which is to be substituted, and
(ii) displayed a notice to that effect in the factory:
Provided that no substitution shall be made which will result in any worker working for more than ten days consecutively without a holiday for a whole day.
(2) Notices given under sub-section (1) may be cancelled by a notice delivered at the office of the Inspector and a notice displayed in the factory not later than the day before the said day or the holiday to be cancelled, whichever is earlier.
(3) Where, in accordance with the provisions of sub-section (1), any worker works on the said day and has had a holiday on one of the three days immediately before it, that said day shall, for the purpose of calculating his weekly hours of work, be included in the preceding week.
The primary object of section 52 is to provide weekly holiday for the workers and such day was fixed to be the first day of the week, i.e., Sunday. But, for any special reasons, it becomes necessary to make Sunday the working day, a substitutional holiday is made compulsory. But the intendment of the section is not that the employers will at their sweet will convert successive on all the Sundays primarily intended to be holidays as working days and make any other working day of the week a holiday instead of Sunday; Motor and Machinery Manufacturers Ltd. v. State of West Bengal, 1964 (2) LLJ 562.
In the light of the above provisions i may say that a WORKER is entitled to the above benefits and a worker includes a daily wager also.
Now it is entirely your decision to agree or disagree
Thanks
From India, New Delhi
The provision related to payment of wages for holiday are nearly same in both the Acts be it Shops and Establishment Act or Factories Act. Even in Factories Act there is Much Clear provision and without any ambiguity. Relevant provisions are Produced hereafter for your Satisfaction:
(l) “worker” means a person 6[employed, directly or by or through any agency (including a contractor) with or without the knowledge of the principal employer, whether for remuneration or not], in any manufacturing process, or in cleaning any part of the machinery or premises used for a manufacturing process, or in any other kind of work incidental to, or connected with, the manufacturing process, or the subject of the manufacturing process 5[but does not include any member of the armed forces of the Union];
As per the Definition above the daily wager are also covered in it as it clearly says any type of person whether employed for wages or not are worker under this act
Now lets Examine the provision for wages for leave:
79. Annual leave with wages.—(1) Every worker who has worked for a period of 240 days or more in a factory during a calendar year shall be allowed during the subsequent calendar year, leave with wages for a number of days calculated at the rate of—
(i) if an adult, one day for every twenty days of work performed by him during the previous calendar year;
(ii) if a child, one day for every fifteen days of work performed by him during the previous calendar year.
Explanation 1.—For the purpose of this sub-section—
(a) any days of lay off, by agreement or contract or as permissible under the standing orders;
(b) in the case of a female worker, maternity leave for any number of days not exceeding twelve weeks; and
(c) the leave earned in the year prior to that in which the leave is enjoyed,
shall be deemed to be days on which the worker has worked in a factory for the purpose of computation of the period of 240 days or more, but he shall not earn leave for these days.
Explanation 2.—The leave admissible under this sub-section shall be exclusive of all holidays whether occurring during or at either end of the period of leave.
(2) A worker whose service commences otherwise than on the first day of January shall be entitled to leave with wages at the rate laid down in clause (i) or, as the case may be, clause (ii) of sub-section (1) if he has worked for two-thirds of the total number of days in the remainder of the calendar year.
1[(3) If a worker is discharged or dismissed from service or quits his employment or is superannuated or dies while in service, during the course of the calendar year, he or his heir or nominee, as the case may be, shall be entitled to wages in lieu of the quantum of leave to which he was entitled immediately before his discharge, dismissal, quitting of employment, superannuation or death calculated at the rates specified in sub-section (1) even if he had not worked for the entire period specified in sub-section (1) or sub-section (2) making him eligible to avail of such leave, and such payment shall be made—
(i) where the worker is discharged or dismissed or quits employment, before the expiry of the second working day from the date of such discharge, dismissal or quitting; and
(ii) where the worker is superannuated or dies while in service, before the expiry of two months from the date of such superannuation or death.]
(4) In calculating leave under this section, fraction of leave of half a day or more shall be treated as one full day’s leave, and fraction of less than half a day shall be omitted.
(5) If a worker does not in any one calendar year take the whole of the leave allowed to him under sub-section (1) or sub-section (2), as the case may be, any leave not taken by him shall be added to the leave to be allowed to him in the succeeding calendar year:
Provided that the total number of days of leave that may be carried forward to a succeeding year shall not exceed thirty in the case of an adult or forty in the case of a child:
Provided further that a worker, who has applied for leave with wages but has not been given such leave in accordance with any scheme laid down in sub-sections (8) and (9) 2[or in contravention of sub-section (10)] shall be entitled to carry forward the 3[leave refused] without any limit.
(6) A worker may at any time apply in writing to the manager of a factory not less than fifteen days before the date on which he wishes his leave to begin, to take all the leave or any portion thereof allowable to him during the calendar year:
Provided that the application shall be made not less than thirty days before the date on which the worker wishes his leave to begin, if he is employed in a public utility service as defined in clause (n) of section 2 of the Industrial Disputes Act, 1947 (14 of 1947):
Provided further that the number of times in which leave may be taken during any year shall not exceed three.
(7) If a worker wants to avail himself of the leave with wages due to him to cover a period of illness, he shall be granted such leave even if the application for leave is not made within the time specified in sub-section (6); and in such a case wages as admissible under section 81 shall be paid not later than fifteen days, or in the case of a public utility service not later than thirty days from the date of the application for leave.
(8) For the purpose of ensuring the continuity of work, the occupier or manager of the factory, in agreement with the Works Committee of the factory constituted under section 3 of the Industrial Disputes Act, 1947 (14 of 1947), or a similar Committee constituted under any other Act or if there is no such Works Committee or a similar Committee in the factory, in agreement with the representatives of the workers therein chosen in the prescribed manner, may lodge with the Chief Inspector a scheme in writing whereby the grant of leave allowable under this section may be regulated.
(9) A scheme lodged under sub-section (8) shall be displayed at some conspicuous and convenient places in the factory and shall be in force for a period of twelve months from the date on which it comes into force, and may thereafter be renewed with or without modification for a further period of twelve months at a time, by the manager in agreement with the Works Committee or a similar Committee, or as the case may be, in agreement with the representatives of the workers as specified in sub-section (8), and a notice of renewal shall be sent to the Chief Inspector before it is renewed.
(10) An application for leave which does not contravene the provisions of sub-section (6) shall not be refused, unless refusal is in accordance with the scheme for the time being in operation under sub-sections (8) and (9).
(11) If the employment of a worker who is entitled to leave under sub-section (1) or sub-section (2), as the case may be, is terminated by the occupier before he has taken the entire leave to which he is entitled, or if having applied for and having not been granted such leave, the worker quits his employment, before he has taken the leave, the occupier of the factory shall pay him the amount payable under section 80 in respect of the leave not taken, and such payment shall be made, where the employment of the worker is terminated by the occupier, before the expiry of the second working day after such termination, and where a worker who quits his employment, on or before the next pay day.
(12) The unavailed leave of a worker shall not be taken into consideration in computing the period of any notice required to be given before discharge or dismissal.
Dear this is a very wide definition which clears the provision as well as it specifies each Scenario possible. Also produced here the provision related to Weekly off in a Factory.
52. Weekly holidays.—(1) No adult worker shall be required or allowed to work in a factory on the first day of the week (hereinafter referred to as the said day), unless—
(a) he has or will have a holiday for a whole day on one of the three days immediately before or after the said day, and
(b) the manager of the factory has, before the said day or the substituted day under clause (a), whichever is earlier,—
(i) delivered a notice at the office of the Inspector of his intention to require the worker to work on the said day and of the day which is to be substituted, and
(ii) displayed a notice to that effect in the factory:
Provided that no substitution shall be made which will result in any worker working for more than ten days consecutively without a holiday for a whole day.
(2) Notices given under sub-section (1) may be cancelled by a notice delivered at the office of the Inspector and a notice displayed in the factory not later than the day before the said day or the holiday to be cancelled, whichever is earlier.
(3) Where, in accordance with the provisions of sub-section (1), any worker works on the said day and has had a holiday on one of the three days immediately before it, that said day shall, for the purpose of calculating his weekly hours of work, be included in the preceding week.
comments
The primary object of section 52 is to provide weekly holiday for the workers and such day was fixed to be the first day of the week, i.e., Sunday. But, for any special reasons, it becomes necessary to make Sunday the working day, a substitutional holiday is made compulsory. But the intendment of the section is not that the employers will at their sweet will convert successive on all the Sundays primarily intended to be holidays as working days and make any other working day of the week a holiday instead of Sunday; Motor and Machinery Manufacturers Ltd. v. State of West Bengal, 1964 (2) LLJ 562.
In the light of the above provisions i may say that a WORKER is entitled to the above benefits and a worker includes a daily wager also.
Now it is entirely your decision to agree or disagree
Thanks
From India, New Delhi
Dear Friends
We need not make any separate payment for Weekly off. Because it is already equally distributed on other working days.
Total No of days in a year : 365
Total Weeks : 52 (So total 52 Sundays) means total working days = 365 - 52 = 313
Total days in a year = 313 / 12 (months) = 26 days
Hence the Monthly wages fixed by the government must be divided by 26 = Daily Wages.
So we need not to pay separately for the weekly off. Because the wages for the Weekly off is already equally shared on other days wage rate.
Hope you have understood.
From India, Kumbakonam
We need not make any separate payment for Weekly off. Because it is already equally distributed on other working days.
Total No of days in a year : 365
Total Weeks : 52 (So total 52 Sundays) means total working days = 365 - 52 = 313
Total days in a year = 313 / 12 (months) = 26 days
Hence the Monthly wages fixed by the government must be divided by 26 = Daily Wages.
So we need not to pay separately for the weekly off. Because the wages for the Weekly off is already equally shared on other days wage rate.
Hope you have understood.
From India, Kumbakonam
i Think retrenchment Calculation Like that For Staff = Gross Salary X 30/2 X No of working Year If it’s wrong. please give write solution Anil Sharma 8053970289 9971154566
From India, Gurgaon
From India, Gurgaon
Supreme Court in the matter of Guru Jambheshwar University vs Dharam Pal decided on on 17 January, 2007 has held "that in case of monthly rated employee the fifteen days' wages shall be calculated by dividing the monthly rate of wages by twenty six and multiplying the quotient by fifteen. But, no such amendment has been made in the Industrial Disputes Act. If the legislature wanted that for the purposes of Section 25F(b) also the average pay had to be determined by dividing the monthly wages by twenty-six, a similar amendment could have been made. But the legislature has chosen not to do so. This is an additional reason for holding that the principle of "twenty-six working days" is not to be applied for determining the retrenchment compensation under Section 25F(b) of the Act."
rajanassociates
Pls see https://www.citehr.com/285737-legal-...-industry.html
From India, Bangalore
rajanassociates
Pls see https://www.citehr.com/285737-legal-...-industry.html
From India, Bangalore
I agree with Rajan. Average pay under section 25F of I D Act means wages paid in 3 months immediately preceding retrenchment divided by 3 and principle of 26 days followed for calculation of gratuity under Payment of Gratuity Act is not applicable for determination of retrenchment compensation. [ Guru Jambheshwar University, Hisar Vs Dharam Pal (2007) 1 LLJ 1006 (SC)]
Regards,
Madhu.T.K
From India, Kannur
Regards,
Madhu.T.K
From India, Kannur
Dear All, how to calculate retrenchment benefit at the time of F&F of a labor. Regards Shashi Kumar
From India, Mahemdavad
From India, Mahemdavad
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