Dear HR Experts,

I need to clarify something about Privilege Leave (PL) as per Factories Act 1948. I do understand that the act says:
(1) Every worker who has worked for a period of 240 days or more in a factory during a calendar year shall be allowed during the subsequent calendar year, leave with wages for a number of days calculated at the rate of-- (i) if an adult, one day for every twenty days of work performed by him during the previous calendar year

I am asking specifically for a pharmaceutical company in India, where there are both factory covered under Factories Act which has both workers (very few) and executives (large) and Offices covered under Shops and Establishment Act. Are there any hard and fast rules about when the leave will accrue to the employee and when he can enjoy it? For example, if an employee (not worker strictly as per factories act, but staff, executives managers etc) works from Jan 15 to March 15, and for the period worked he is eligible for the proportionate amount of Leaves for that quarter, can the employee avail (enjoy) the proportionate PL accrued in April or any time during the current year or does can the employee only avail (enjoy) the earned leave after the completion of the current calendar year 2015? If he is allowed to avail it in April itself, does that pose any problem under any law?

My question comes because we now have technology and ERP systems in place which allow leave accrual, balance and other data etc to be auto calculated and credited based on system defined rules, unlike the years before technology when manual register based systems made it impossible. I have seen companies who allow credit PL on a quarterly or 6 monthly system as they earn it, and employee is allowed to avail it as it gets credited into his leave account. Is there anything wrong with that practice?
What is the norm followed here by others. Please enlighten with your inputs.

Mona Dutta

From India, Mumbai

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Dear Mona Dutta,
In the first place, Privilege Leave or Earned Leave as the very name would suggest is a privilege to avail of leave by an employee or workman in the succeeding year earned on the basis of a certain number of service rendered by him in the current year. So, strictly as per whatever the law applicable to the industrial establishment, whether a Factory or other specific establishment covered by any other establishment-oriented Law, the question of availing of Earned or Privilege Leave will arise only after the completion of stipulated length of service mentioned therein. If the employer, on the contrary, allows his employees to avail of this leave on quarterly basis, well, this is more benefecial to the employees and as such does not pose any problem.
Secondly, your question, I do suppose, arises from the point of view of unity of management. Any manufacturing industry, irrespective of its core activity, can undertake other actvities like distribution, marketing and sales and the like. It is not necessary all these activities should emanate from the same premises. When they are done from different premises/places the appropriate establishment-oriented laws will be applicable to them. So the scale, eligibility and entitlement, accumulation limit of the privilege/earned leave will be according to the particular law or the classification of employees as the case be.

From India, Salem

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