Saswatabanerjee
Partner - Risk Management
Apex Management
Labour Laws Consultants
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Hi.. I have recently joined in a company as HR Executive, have a doubt regarding Earned Leaves. One Employee has joined on 05.11.2015, after completing Probation period of 6 months, he is confirmed employee now. In our company 1 EL is credited after 20 working days. Can anyone please tell me the Eligibility criteria to avail EL ?
Is Employee eligible to avail EL credited in year 2016 in same year itself or he can avail in subsequent year ?? Secondly, as per law How many EL can be carried forward and for How many years ??
Regards
Shreya
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Hello Shreya,
The general norm is that the earned leaves can be accumulated to a maximum of 30 days.
Some of the best practices are as follows:
The EL's should be calculated even during the Probation , the only difference being that it cannot be taken during the probation period and will get accumulated during that period
You can look at crediting 1.75 EL's/month at the end of the every month and for December alone the credit can happen at the beginning or the mid of the month ( 21days/Year)
When the employee leaves the organization the balance of EL's can be paid off based on the last drawn basic
The law in general states the below:
Entitlement-On working 240 days in a year. On joining mid year, he/She will be entitled to 2/3rdof the remaining period during the year
Hope this helps
Regards,
Saif
Ms. Shreya,
I don't know if you are aware that while Financial Audit is done an amount is provided as "Liability" to the Company which is called "Acturial Value of Accumulated Leave". It is mandatory to consider the figure in the "Balance Sheet" as otherwise it would not be possible to pay an Employee for "unavailed Privilege Leave" at the time of Retirement/Termination of Services. It is essential thus to limit accumulation of Privilege Leave to limit liability. Since there is no legality attached, it depends on the "Service Rules" of the Company and normally employees are allowed to accumulate leave up to 60/90 days (considering entitlement of 30 daya PA).
Regards,
Hello Shreya,
EL/CL/SL authorization is to be calculated as per Factories Act/ Shop and Establishment Act.
An organisation may give more than what is prescribed but can not give less than that is spelled out in the relevant Act.
Accumulation of EL is also prescribed in the relevant Acts-- Factories Act/ Shop and Establishment Act.
Hope this helps.
Best Wishes,
Col.Suresh Rathi
Shreya,
Please note that
1) Earned leave is "earned" even during the probation period.
2)The calculation procedure of earning 1 EL after 20 working is correct.
3) The leaves so earned during a calendar year can be availed in succeeding year.
4) No entitlement of earned leave if working days in a calendar year are less than 240 days or 2/3rd in other cases.
5) EL so earned can be availed in succeeding year in three times by moving application by 15 days in advance and minimum three days duration.
6. Maximum carry forward accumulations of EL are 30 days or as provisioned in the certified standing orders.
Hope your all queries are replied.
P K Sharma
Calculation of EL varies --say as per Delhi Shop and Establishment Act --it is 5 days EL for 4 months of service provided the employee has put in at least 60 days of physical service whereas as per Factories Act it is 1EL for 20 days but credited after 240 days.
So there is no thumb rule and varies as per applicable Act
Suresh Rathi
Shreya
First you need to tell us what your organisation is, whether its factory or office or in service, where it is located. The leave rules in each state vary, you need to see the leave rules under factory act or shop and establishment act (again statewise), and also if you have more than 50 employees, you need to see the additonal rules in Model / Certified Standing Orders.
one for every 20 generally applies to factories.
and if you have worked for part of the year, then provisions are different.
The provisions of leave apply even for the portion when the employee was on probation, though mosly he cant use leave during probation (but leave earned during the period can be used next year)
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