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SKR323
Hi, Please let me know if Privilege Leave is calculated pro rata on the basis of the date of joining. My company policy is 1.5 days at the end of the month. Thanks
From India, Chennai
vmlakshminarayanan
919

Hi,

An employee becomes eligible for Privilege Leave ( or Earned Leave) only after completing one year of continuous service with the organization. Whether you follow calendar year or financial year based on the DOJ PL can be allotted on pro rata basis. If you follow financial year and if Employee joins by August then leave should be allotted on pro rata basis :- total leave for the year / divided by 12 x 8
( i.e leave eligibility from August to Mar of subsequent year which 8 months period)

From India, Madras
SKR323
Thank you for your prompt response. My company is in KPO and leave balance accrues from the day they become permanent employees. I am still unclear on how much an employee who joins on 25th of the month would accrue. Appreciate the help.
From India, Chennai
vmlakshminarayanan
919

Hi,
If the employee joins by 25th of the month he /she should not be eligible for leave for that month and leave can credited from the subsequent month. The common practice followed among companies is that if the DOJ is after 15th ( or the leave eligibility date falls after 15th ) then leave eligibility will be from the subsequent month.

From India, Madras
Madhu.T.K
4194

Since the establishment is not a factory but a commercial establishment in Tamil Nadu (I presume) the Tamil Nadu Shops and Commercial Establishments Act will be applicable to your establishment. and as such you have to give 12 days sick leave and 12 days casual leave in a year. In addition to these, after completion of 12 months' service, he should be given 12 days earned leave also. Though the sick leaves and casual leaves would lapse at he end of the year (normally the calendar year is considered as year for this purpose) the unavailed earned leave can be carried forward to next year. It can be accumulated up to 45 days.

An employee joining any time during the year shall be given CL or SL proportionately. Therefore, if an employee joins a company in August, he should be credited with 5 days each of CL and SL for the year upto December. Since he would earn Privilege Leave only after 12 months' service, he may be given credit of it only in 2025. But if you want to make a uniform date for crediting the leave you can credit the EL also in January but the credit shall be made prorata.

Unlike Factories Act, reference is not made about physical days worked under Shops Act. Therefore, leave is credited based on months only. As such the leave (CL and SL) is to be credited in advance and not after every month. In practice whenever you take month for calculating the leaves, if he date of joining is prior to 15th of the month, ie, any day between 1st and 15th, it would be counted as one month and any date of joining after 15th would be ignored. Therefore, an employee joining on 25th would not get leave for that month.

The number of privilege leaves that you give is more than what is required under the law. I hope you have Cl and SL also in force over and above the privilege leave mentioned in the post.

From India, Kannur
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