Greetings To you all,
I would need some clarity on below formula.
If Leave Encashment is done on as below.
BASIC + DA / Present Month ( 30 / 31 ) * No of EL = Payable
Basic - 5000
DA - 2000
Month Days - 30
Balance EL - 20
5000+2000/30*20 = 4666.66 ( Round Off - 4667 ) is payable.
Is this is correct pls comment for any correction with valid reference on provision or rules mentioned in any books.
From India, Bengaluru
Legally there is no such term as Leave Encashment, it is payment of leave wages. This happens at end of employee service. But some companies pay-off leave wages annually. In leave wages all allowances are to be covered besides basic & DA.
From India, Mumbai
Dear Mr. Chandra Dev, Formula for EL payment is Last Basic salary+DA/26*No. of EL. i.e. Basic - 5000 DA - 2000 EL - 20 Then payment would be 7000/26*20= 5385 Regards, Rahul Sindhwani
From India, Varanasi
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