Earned Leaves Encashment - EL Encashment is calculated on "Gross salary" or "Basic+DA"? - CiteHR
Rahul Chhabra
Hr Professional
Asst Manager Hr

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Any one Plz Suggest me regarding EL Enchashment,
1) Encashment has any formula?
2) EL Encashment is calculated on "Gross salary" or "Basic+DA"?

Dear Karthik,
Please refer to the Act which is applicable to your establishment and the policy followed by your organization. Usually, Leave Encashment is done at the time of employee exit and the following formula is used:
((Last drawn basic pay+DA)/30)*Number of Earned Leaves to be encashed
In case of workmen, the following formula is also used:
((Last drawn basic pay+DA)/26)*Number of Earned Leaves to be encashed

Thank you Sir,
For your valuable Suggestion.

One small Query is that ,
There is any Amount limit for EL Encashment.
Thank you in advance

Dear All,
Is there any specific section defined in factories act for considering Leave encashment Basic+Da only, please share us. I think we need to consider on Gross.
Shivananda V D

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