What all benefits one can claim if a Private Business organisation is Downsizing/Closure of Branch Operations? - CiteHR
Labour Law & Hr Consultant
Personnel & Industrial Relations
Asha Kanta Sharma
Accounts Manager
+1 Other

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Dear All, Please let us know what all benefits one can claim if a Private Business organisation is Downsizing/Closure of Branch Operations/.

Dear Asha,
You have to serve one month notice or one month's pay in lieu of notice, retrenchment compensation @ 15 days average wages for every completed year of service, gratuity if eligible and cash equivalent to the no of days of E.L at credit.

Dear Sir,,
What are the conditions for employers i.e Size of the organization, turnover, strength, or number of workmen employed , any application made to Labour Commissioner for closing down the establishment ? What is the legal eligibility criteria for an employee i.e Age, Date of Retirement, Designation, No of years of service , service remaining etc ? Any other act other than ID act and its applicability ? Please explain in detail, it would be a great learning for all , please also tell any act governing VRS to private employees.
Manish S Joshi

To add to Mr.Umakanthan's answer to Asha Kanta sharma's query, if the employee has been employed for a temporary term directly by the employer prior to his permanent employment, then that temporary period will also be counted while the Closure / Retrenchment Compensation is paid to the outgoing employee. Similarly for Gratuity too, the temporary period will be counted in the tenure.
For calculating the Retrenchemnt or Closure compensation, the amount equivalent to the cost of any facilities accruing to the employee like Tea every month needs to be added to the monthly gross of the employee.
RC / CC is calculated as Monthly Gross + Cost of Tea / 30 x 15 x tenure of the employee including temporary period.
For Gratuity = Basic / 26 x 15 x tenure of the employee including temporary period.
If the employee was an outsourced employee, that tenure is not counted.
As regards Mr.Manish Joshi's query, there are detailed provisions enumerated in the ID act. Please refer to the same.
Please note that under the Payment of Gratuity Act , a 60 days notice of the intended closure needs to be given to authorities under the Act.

Hello Everyone,
My Employer has told us that Earned Leave Encashment will be paid for for HALF PERIOD (i.e, 10 Days if 20 Days of Earned Leaves are available) only for the current years Leaves Balance Available. No Earned Leave Encashment will be provided for the Balance available for the previous year.
Is it legal & as per law to pay Earned Leave Encashment for half period?

Dear Sharma,
Your employer's contention is wrong and therefore contrary to law. What the salary payable to the employee if he actually avails the leave should be paid to him when it is surrendered for cash benefit.

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