Am I Eligible for Earned Leave with 200 Working Days a Year? Seeking Advice

Hi, I'm working in a Pvt. Ltd. Company for the last five years, and my working days are 200 in a year (Jan 09 to Dec 09). Am I eligible for Earned Leave? I have no opening earned leave balance. How many Earned leaves will I gain? Please reply.

You have not mentioned whether your company is covered under the Factories Act, 1948, or State Shops & Establishment Act. If you are covered under the Factories Act, then according to Chapter VIII of Annual Leave with Wages, you are required to work for 240 days as per this Act in the year 2009 to be eligible for Earned Leave during the year 2010. If your company is covered under the Shops Act, then refer to the Earned Leave provisions for clarification.

My company is covered under the Factories Act, 1948. That means I am not eligible for any Earned Leave. Thank you for your earlier reply.

Regarding a new employee joining on September 9th and working 95 days in a year, would they be eligible for Earned Leave and how many days of General Earned Leave would they receive?

Dear,

In that case, we are to go through section 79 Explanation 2(2) which runs as follows: A worker whose service commences otherwise than on the first day of January shall be entitled to leave with wages at the rate laid down in clause (i) or, as the case may be, clause (ii) of sub-section (1) if he has worked for two-thirds of the total number of days in the remainder of the calendar year. Thus, if the employee fulfills this condition, then he will be entitled to Earned Leave (EL) at one for every twenty days. For more details, you may also go through section 79 of the Factories Act, 1948.

Hi,

In any organization, an employee has to work for a minimum of 240 days (i.e., 8 months) to be eligible for earned leave, which is 15 days per annum.

Regards,
Charvaka Reddy

Dear Vinsagar,

Please let us know your company's weekly schedule. If your company works 5 days a week, it means deducting 104 days from 365 days, along with any taken CL/SL and holidays provided by the company, you may be eligible for EL.

Best Regards,
Sajid

Dear All,

It's okay that one employee can get Earned Leave (EL) only after working for 240 days in a year. Now, please let me know whether these 240 days are inclusive of all holidays and leave he/she avails in the last year or if it's just the working days.

As per my best knowledge, a person gets EL after every 20 working days. So, does this 20 days include holidays and leave? How is this EL calculated? Please let me know?

I have 2 questions:

1. How are earned leaves encashed? Are they based on basic pay or gross pay?
2. Also, regarding the deduction of unpaid leave, is it calculated based on basic pay or gross pay?

Entitlement of Earned Leave is governed by provisions of the Factories Act and Shops Act. So, you have to decide under which statute your company is registered.

The basis of calculation of EL under the two statutes is different. The best thing for you to do is to study the provisions of the law applicable to your company and understand the entitlement of Earned Leave.

Vasant Nair

Dear Mr. Vasant,

Our organization falls under The Factories Act. Please let me know the answers to my queries I have stated above.

Regards,
Jitul

Under the Factories Act, during a calendar year (January to December), to be entitled to Earned Leave (EL), an employee must have worked for a continuous period of 240 days. This period includes Weekly Offs and leave, including Leave Without Pay (LWP). The only exception is the period of unauthorized absence from work, which will not be counted towards the 240-day requirement, the basic qualifying criteria for EL entitlement.

EL is calculated at the rate of 1 day for every 20 days worked. For the purpose of the 240 days requirement, EL is also taken into consideration. However, EL is not accrued for days when one is on EL or any other form of leave. EL earned during the current year can only be utilized in the following year. Encashment of EL is generally based on Gross pay.

I hope I have addressed your queries. It would be beneficial for you to read the relevant sections of the Factories Act to gain a thorough understanding of the treatment of EL for your own enrichment.

Best Wishes,
Vasant Nair