Partner - Risk Management
Asst. Manager Hr In A Construction Mnc
Manpower Planning
+3 Others

Dear All,
Greeting of the Day...............
I have an issue regarding Leave Encashment. Need suggestion on the below described case.........
We are a construction compony, constructing a steel benefiaciation palnt. Our plant is surrounded by 4 villages, having around 2200 villagers. Among them 800 are land loosers. From the starting around 2.5 yrs we distributing monthly wages to all the 2200 villagers categorising as (Unskilled, Skilled, Semi Skilled, Highly Skilled) as a peripheral welfare activity. The wages are paid according to the Govt. prescribed rate. One thing I want to mention here that, all the 2200 villagers are not working.
Now the villagers are on strike demanding for the Encashment of Leaves for the last 2.5 yrs they are getting the wages. My query, is there any standing order act for the above said issue. If yes, what are they and on what basis we have to pay.

From India, Calcutta
Dear Mr. Santosh KN
Greetings of the day.
Please elaborate a bit more. Did your company sign up an agreement with these villagers ? Have the villagers given any offer/appointment letter describing the limits of this magnanimity? Seems your company paying them under CSR obligations.
with regads

From India, Delhi
There are no written agreement with the villagres to pay them monthly wages. Nither they have given any offer letter nor any appointment letter. The wages what we are paying under CSR obligations.
From India, Calcutta
Leave encashment is not a statutory right even to employed persons while in service. VARGHESE MATHEW
From India, Thiruvananthapuram
Dear Mr Nayak
This is a very critical condition. If your company engaged with them through any contract then it can be sought out but if it is not then there is only one solution you invite their leader and arrange a meeting with them and find the solution for this problem. As you said that your company is surrounded by the villagers. Try to find the middle path as well as try the one final solution.
with regards,
Meenu singh

From India, New Delhi
Encashment of leave earned by an employee is payable as a part of contract ,under which the employee is working.Since there is no contract of employment between the parties,there is no case for payment of leave salary.You may pay some ex-gratia,but do n't call it leave salary. Thanks.
From India, Bokaro
Dear all
Here Standing Orders Act doest come into picture,pls. refer to Factories Act and clarify to them on the Act position.Whethr they have been given employment order or not is immeterial .You have engaged them on job for more than 2 years.Progressively they all labour Acts will be applicable to them.
Best wishes
T.Bhaskar Reddy
HR Consultant

From India, Hyderabad
I am confused.
You are paying a monthly amount to 2200 villagers who are not working its you.
So lets not call it salary or wages
You say they are in strike.
How can they be on strike when they are not working ?
Even if they were entitled to leave (which they are not since they are not working), they are not coming to work, so,they re on leave all the time. Where would be the question of encashment of leave. Unfortunately people get greedy and consider benefits as their right. I wonder if they considered that the company may simply stop paying the money altogether.
As others said, this can take an ugly turn, with physical violence against company staff and managers. You may need to take the help of the local government officers like the district magistrate and the panchayat chiefs to resolve this. Showing the letter of law to these villagers is not likely to have an effect.

From India, Mumbai
In this case no Act will act. These fellows are not entitle for of Leave Encahment since they are not on the rolls of the company. Members rightly have fears possibilty of violence on part of the villagers once the exgratia payments stopped by the company. It will be wise to have consultatiions with the Labour Deptt as well the local administration indulging the village panchayats to sort out an amicable solution of the issue to proceed the business in that area. Also encash this opportunity to sign out an expliicit agreement with all the parties related to the issue for future references.

From India, Delhi
Dear Member
As mentioned by you not all the villagers are working for you so it means that there are certain number of villagers who are working for you. Is the matter of Leave encashment pertaining to the villagers who are working for you or through the contractor.
Secondly there must be some written understanding reached between the company and the villagers based on which company is paying out such huge amounts in CSR activities month on month.
Request you give a more clear picture to the fellow members so they would be able to give their opinion on the same.
Preetam Deshpande

From India, Mumbai

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