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Can an MNC under Shops & Establishment Act (ITES - Back office of a Leading UK Bank in Telengana) deduct Salary or Leaves in lieu of (forced) National Holidays including Gandhi Jayanthi falling on a Working day?
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No they cant but there are loopholes always. It'll take long time to prove that the employer is wrong... I have seen firms giving additional salary for those who work on Independence day, Republic day, Election day and all other National Holidays.
Dear Roopchand,
Pl refer to Sections 3 and 5 of the Andra Pradesh Factories and Industrial Establishments (National,Festival and Other Holidays) Act,1974. The employees who are required to work on a National or Festival holiday falling on a working day shall be paid double wages or alternative holiday and for this purpose a notice shall be served to the concerned employees and submitted to the Inspector 24 hours before such holiday.
Thanks for enlightening. The firm employing close to 5000 work-force in a single location ( firm has multiple locations of operations), also follows payment of double wages on such National Holidays - but only limited to approximately 20% (termed as 'critical work process' )of the employees, who are asked to work on these days. However, for other employees (close to 80% approximately) it is a forced holiday, by deducting 1 days from their leave balance, or deducting one day's total pay+DA + Allowances including PF etc., if the employee does not have leave balance. Are they exempted to do so under any local laws as an MNC? Of course the cost saving would be enormous considering the number of employees/work-force.. Raising any question/s is considered as behavioral issues, and has the potential for the employee to be put under Disciplinary action/ losing the job.
Sections 3 and 5 of the Andra Pradesh Factories and Industrial Establishments (National,Festival and Other Holidays) Act,1974 talks only about payment of double wages for employees summoned to work on the National Holidays. However, there is no mention about the deduction of employee's leave or salary in-lieu of wages for the (forced) holiday for section of employees within the firm.
Every employee having completed 30 days of service within a period of 90 days is eligible for paid holiday on a day of National holiday. The question of double wages or grant of a substituted day of holiday will arise only when he is required to work on that day subject to his choice of choosing any one of the two options. Therefore, deducting wages for the holiday allowed on such a day is illegal. Bring it to the notice of the Inspector under the Act in an appropriate way, if scared.
On my querying, the management has this to say: The company already provides 8 Festival Holidays ( as per UK Bank Holiday List) , and as such these National Holidays cannot be paid unless the staff is summoned to work. However, in my tenure of 9+ years with the company, I observe, in the last three to five years only these and other similar cost-cutting practices are followed; earlier, National Holidays used to be paid holidays along-with the regular UK Bank holidays. I wonder if the Inspectorate authorities are not in the know of such practices followed in a large company, employing huge work-force. I have worked in reputed Indian leading manufacturing companies in the past for 25 years, in Mumbai and other locations, never have I found such a blatant violation or insult to the Government of India/state government guidelines on observing National holidays in India.
Now, going by what is said above by the MNC 'corporate', I do no understand how they are safely paying Double Wages for the employees summoned to work on National Holiday, and preferring not to pay/deduct leave or salary for majority of employees. If the cap of 8 Festival Holidays as per the argument is observed, logically, they must not pay the double wages either. It appears evidently that the company is hoodwinking/window-dressing their act in the eyes of the local labour laws, and enormous costs at the cost of the employees' benefits due. Probably, I must wait for my Salary Slip for October and take it up with the authorities.
In the event of default by the employer to pay wages for every holiday specified under the A.P.I.ENFH Act1974, Sec 8(1) of the same Act empowers the affected workman or the trade union in which he is a member or an inspector under the Act or any other authorised representative to file a claim u/s 15 of the Payment of Wages Act,1936.
Thank you for the information Sir. I also understand that any substitute/ 'alternate' day as in the Act comes into picture ONLY when the employee had worked on that holiday (Gandhi Jayanthi), and that the choice of double wages or alternate holiday rests with the employee. So it is clear that the establishment cannot claim that one of its declared (festival) holidays are an alternate day of holiday for Gandhi Jayanthi as it is being done here.
Mr./Ms Anonymous,
Your academic query, "Can an MNC under Shops & Establishment Act (ITES - Back office of a Leading UK Bank in Telengana) deduct Salary or Leaves in lieu of (forced) National Holidays including Gandhi Jayanthi falling on a Working day" has no relevance unless you give proper description of the problem, whether the holiday occurs in betwenn the period of leave or deduction made for enjoying single day as a holiday on account of Gandhi Jayanti.
Notwithstanding prefix or suffix of holiday, if the holiday occurs in between the leave period of the employee, the day of Gandhi Jayanti would be treated as a part of leave, irrespective of whether the leave is of paid or unpaid nature.
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