Leave Encashment Calculation - Factories Act
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Leave Encashment Calculation - Factories Act

murali12 Started The Discussion:

Dear seniors,


Am in to hospitality sector (Under KSCE-1961) I wanted to clarify the leave encashment confusion whether it is paid on gross / Basic+DA. Under the act its defined wages means Basic+DA but in my last assignment we had paid on Gross salary, as well as present company says pay on BA+DA. Kindly advice

pdmatta@gmail.com - Member Since: Dec 2010
yes it is right. Rule says Leave encashment should given on BASIC+DA.
and counting should be on 26 days.

but its also depend on the company policy. if company pays on Gross. that is their own policy. company can Pay on Gross salary also.

globaloverseas144@gmail.com - Member Since: Feb 2011
Dear Murali,

Encashment of leave is only on Basic & D.A as per Act, if organisation willing to encash on whole salary including allowances then it is fine (up to the policy of company).
Keep in mind the calculation should be based on 26 days.

It is good practice to pay leave on gross wages becuase sometimes we adjust EL into employee absentism (if employee wants to adjust his/her Earned leave from the leave account) then adjustment is on gross one day wages against one day leave.

zakiranjum - Member Since: Feb 2008
Hi, Please find attached the format for Leave Encashment. Zakir


Attached FilesProvided by community member zakiranjum. Join us to learn and grow with your peers.
File Type: xls Leave encashment(1).xls (51.0 KB, 7039 views)
KUMAR .PVVB - Member Since: Jan 2009
Dear Member
Encashment of Leave is enforced as per provisions of the Factories Act in which the term of wages is clearly defined as Basic + DA. However if the employer desires to pay EL on gross wages, it will be definately nice and helpful to the employees.
Regards
PVVB KUMAR

Rajiv Madan - Member Since: Mar 2007
Dear Team members What is the procedure of calculation EL within Shops & Establishment Act as I am working in hospitality industry. Kindly advice. Regards Rajiv Madan 98102 97179

vivek_hr - Member Since: Jan 2008
Please refer Leave Encasement rule mentioned in your state’s Shops & Establishment Act. Thanks

pappu mishra - Member Since: Aug 2010
Daer sir , Please refer Leave Encasement rule mentioned in Maharashtra State’s Redymade garment house. Regards Pappu Mishra

surajjohnson - Member Since: Sep 2011
Dear Sir i want know to know if a person has got expired how to claim for his privilege leave encashment. please give the further details.

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