Saswatabanerjee
Partner - Risk Management
Jeevarathnam
Sr. Manager Hr/admin
+1 Other

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Dear Fellow HR compatriots, I have a query. What are statute regarding Privileged Leave for a company in terms of carry forward or encashment.
Can any company chose not to carry forward any PL to next year under any Act?
Look forward to some detailed insight on the Subject.
Cheers
Anubha Shankar
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Dear Anuba Shankar
As per the shops & Commercial establishment act you have both the options either to carry forward the leaves to next calendar year maximum carry forward is limited to 30, or you shall encash the leave wages end of every year. For that you should frameout the leave policy
No Shops & Commercial establishment or factories act follow fiscal year for leave or annual returns. They follow only CY
Jeeva, Is it explicitly mentioned in the act because as per my understanding Acts only mention 12 months. Please specify.
Hi Anuba
I am enclosing the copy of Karnataka Shops & Commercial Establishment Act. In that Page no. 10 & Sl Y is clearly mentioned "Year" means the year commencing on the first day of January.
I hope this is sufficient proof our your doubt.

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Since you are in delhi you need to follow delhi shop and establishment act
Check and see what it says.
Is there a specific rule requiring carry forward ?
Our office makes it a rule that all leave needs to be taken during the same year. It's a part of our policy to have a work life balance and ensure adequate rest and not to allow employees to sacrifice rest for earning slightly more money.
Most of the shop and establishment acts are silent about carry forward, so there is no compulsion for the employer to do so. However, if you deny an employee leave, then you must carry forward the leave

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