Understanding EL Encashment: Can You Cash Out Before Leaving or Retiring?

When can we encash EL? Is it only during the time of separation or superannuation, or can it be encashed without exceeding the accumulation limit and how?

Hi Akhila,

Exactly, this matter depends on individual company policy because leave encashment is possible in that case only when the company has funds.

Another aspect is that some companies practice the accumulation of earned leave up to 42 days over two years. Please check your company's policy for clarification.

Regards,
Bhagwan

Thank you for that.

That means if I have 90 leaves to my credit, and the maximum accumulation is 75, then the 15 days I can encash anytime (in general).

Encashment of earned leaves depends on the company policy in the case of private organizations. In most cases, there is a maximum limit (say 42 or 48) to accumulate earned leaves. Anything beyond that gets encashed at the end of the year (say December if the year followed for leaves is the calendar year).

Regards,
Nikita

Dear Sir,

As mentioned above, encashment and earned leave depend on policy. We are a small IT company that comes under the Bombay Shop & Establishment Act. We are working on the leave policy but do not want to provide any encashment after exit.

Kindly guide me. Can I?