Hr & Administration Specialist
Motherson Sumi Systems Ltd.
Please find herewith our leave encashment policy.
Our policy is to accumulate 30 days leave in account and the leave which are more thatn 30 are eacashed. i.e if total leave for any person on 1st Jan is 45 then he will get an encashment of 15 days. The leave encashment policy is as under
Basic Salary divided by 26 & multiply by No. of days to be encashed. In the above case it is 15 days.
Personnel Policy No:
Authorized by :
Effective date :
Supersedes Policy dated:
Next Review date:
To enable employees, avail leave to meet personal exigencies and recoup periodically, by taking rest and being with the family.
All the employees on the rolls of the organization shall be covered under this policy.
Policy Details as under:
1. Leave shall be determined for the calendar year (i.e. January to December)
2. The Leave will be credited to an employee’s account on 1st of January every year. In case an employee joins after the above date, leave will be granted on pro-rata basis.
3. No employee shall be entitled to leave during the probationary period (except due to sickness/ personal exigencies). However, such probationary period preceding confirmation will be taken into account while calculating leave entitlement.
4. Intervening weekly offs and paid holidays will not be counted as part of availed leave.
5. Employee cannot avail leave as a matter of right. The Management reserves the right to refuse, revoke or curtail leave as per the exigencies of work.
6. Leave cannot be availed by any employee, unless and until the balance is available to ones credit. Exceptions can be made only by Chief Operating Officer / Unit Head and that too under extreme emergency only.
7. The employee has to retain a minimum of his leave entitlement as balance on the leave account on 31st December of every year. Any excess leave unavailed during the financial year, will be automatically encashed.( Based on one month’s basic salary for 26 working days, subject to deductions as per IT rules.
Hope this helps
Sandeep Kumar Dwivedi
18th December 2010 From India, Delhi
Please do check older posts on leave record & documents attached there in “Leave Record Format”.
I have developed an excel sheet document that can assist you to calculate employees total leave & also claim for encashment at the same time by the end of the year. It’s a very generic document with basic mathematical rules for calculation, as you develop your manual do modify calculation rules accordingly.
I hope this document will be of use for your purpose
Good luck & Regards
19th December 2010 From Oman, Muscat
I dont think Earned Leave is denied for a Prabationer.
As per Factories Act, we have to provide Earned Leave to all employees including Trainees / Probabationers / Contract Labourers - irrespective of all cadre / category / grade, etc. etc. etc. Maximum EL (Earned Leave eligible) = 15 days in a year (365 days - 52 Sundays - 9 N&F Holidays (National & Festival) = 304 / 20 days = 15 days for those persons who are joining on 1st January and others who are joining after this date, will be eligible for EL on prorata basis.
But Government Act Apprentices are not eligible for Earned Leave (EL) - They are eligible for Leave as per Apprentices Act. i.e., 12 days Casual Leave and 15 days of Medical Leave with payment of stipend. EOL (Extra-ordinary Leave upto 10 days with or without payment of stipend may be granted at the discretion of the establishment.
20th December 2010 From India, Bangalore
Encashement is not mandatory during service period.It's depend of company policy.If company defined in his standing order that more than 30 EL will be Encashed then company is bounded to encashed.If company defined that more than 30 EL will be lapse employee can't force to employer for encashment.
30th September 2011 From India, Delhi
My company has recently changed "leave encashment of earned leave" clause as "An employee is eligible for leave encashment only after serving for a minimum period of 2 years in the organisation".
This was the strategy to save maoney as we are terminating few people and they will claim leaves encashment.My question is , is it legally correct?
20th March 2013 From India, Mumbai