Earned Leaves & Leave Encashment. Is it mandatory in a manufacturing organization (factory) to give earned leaves and leave encashment? Can the employer deny granting of earned leaves or deny leave encashment of earned leaves not availed by the employee?.
Also please inform if P.F. is deductible on leave encashment?
From India, Delhi
1Also please inform if P.F. is deductible on leave encashment?
From India, Delhi
Dear Arun,
Pl go through Sec. 79 of the Factories Act, 1948 and analyse all its provisions about Annual Leave With Wages which is the statutory name for E.L.
It is mandatory and not a subject-matter of the choice of the employer.
Statutory encashment of E.L would arise only in the event of termination of employment. But normally industries follow the practice of annual surrender of EL at credit for cash benefit.
This surrender leave salary will not attract EPF/ESI subscriptions.
From India, Salem
Pl go through Sec. 79 of the Factories Act, 1948 and analyse all its provisions about Annual Leave With Wages which is the statutory name for E.L.
It is mandatory and not a subject-matter of the choice of the employer.
Statutory encashment of E.L would arise only in the event of termination of employment. But normally industries follow the practice of annual surrender of EL at credit for cash benefit.
This surrender leave salary will not attract EPF/ESI subscriptions.
From India, Salem
If carried over and encashed with the termination of service/resignation/retirement, how many days of minimum encashment is compulsory. I did not find anything related to this in the section mentioned. I understand that 30 days of the earned leave is the statutory limit to be encashed and anything over and above this will lapse. Please clarify.
From India, Delhi
From India, Delhi
Pl.take note of info shared in these links w.r.t. 'EPF on leave encashment' and SC judgment and consequent circular issued by the EPFO on the subject.
https://www.citehr.com/10278-pf-cont...nt.html#417281
https://www.citehr.com/10278-pf-cont...nt.html#418544
From India, Bangalore
https://www.citehr.com/10278-pf-cont...nt.html#417281
https://www.citehr.com/10278-pf-cont...nt.html#418544
From India, Bangalore
At any point of time, the credit balance of the workman's Leave A/c would reflect the maximum no of days of unavailed leave subject to the ceiling only. and the excess would get automatically lapsed for the calculation purpose.
From India, Salem
From India, Salem
I may add,
So far as accumulation of EL/PL & SL in the leave a/cs are concerned, it's generally followed in most of the industries that further credits over and above the maximum-ceiling limits(no.of days) automatically elapses. Some industries, as part of agreement with union(s) reach to a clause that a given no.of days, say about 10 days of EL/PL is allowed to be encashed every or alternate years uniformly for all willing employees. This arrangement not only helps employees in their financial requirement but also enable the employer ensure improve available mandays for their production planning. The industry where I was working had this facility. Persons use the accumulations to be encashed when need arises such as school/college admissions, festivals etc if their leave rules permits this facility. This is possible in small industries/firms.
Also, in many instances, due to official exigencies persons in critical positions may not find relaxed days so that he/she can avail leave amidst pressing commitments/targets to be hit. In such exceptional cases, the competent authority duly vested with administrative powers relaxes the stipulations and allow a part of CL or EL remain unutilised to be carried over or to be encashed respectively. Some banks & establishments also link the encashment with availing LTA.
From India, Bangalore
So far as accumulation of EL/PL & SL in the leave a/cs are concerned, it's generally followed in most of the industries that further credits over and above the maximum-ceiling limits(no.of days) automatically elapses. Some industries, as part of agreement with union(s) reach to a clause that a given no.of days, say about 10 days of EL/PL is allowed to be encashed every or alternate years uniformly for all willing employees. This arrangement not only helps employees in their financial requirement but also enable the employer ensure improve available mandays for their production planning. The industry where I was working had this facility. Persons use the accumulations to be encashed when need arises such as school/college admissions, festivals etc if their leave rules permits this facility. This is possible in small industries/firms.
Also, in many instances, due to official exigencies persons in critical positions may not find relaxed days so that he/she can avail leave amidst pressing commitments/targets to be hit. In such exceptional cases, the competent authority duly vested with administrative powers relaxes the stipulations and allow a part of CL or EL remain unutilised to be carried over or to be encashed respectively. Some banks & establishments also link the encashment with availing LTA.
From India, Bangalore
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From Ukraine, Lviv
From Ukraine, Lviv
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