LEAVE ENCASHMENT+PRIVATE COMPANY

Dear Seniors,
I am working in a pharma company having medical devices and we have employees +150. The only thing that is confusing is about the leave encashment???? Are there any laws pertaining to leave encashment for private ltd. co.s?????Leaves i.e PL and SL which is carried forward, for how many maximum years it can be carried forward??? secondly when can it be encashed by the company???or its whole and sole company's discretion to encash??and on which salary it can be encashed-Basic or Gross salary???I have found out it is encashed on Basic, but can the pvt. co. encash at Gross and current salry?????
I request to you to kindly throw some light on this topic and jus factories Act, or any other such act where norms are given for leave encashment are applicable to pvt. ltd. company.
I request all to help me out soon.
Waiting for answers.
Thanking you,
Bhavna Bhadka

hello,
There are rules regarding leaves under Bombay Shops and establishment Act.
Casual Leave is generally granted 7-12 days in a year which may or may not encashable . It is for employer to decide as per service condition.
Sick Leave is generally granted 12-15 days in a year which generally is not encashable but some employer do permit upto certain number of days. Accumulation can be upto 90-150 days as per service condition laid down by the employer.
Privilege leave is granted at the rate of 21 days a year. Under Shops act accumulation is 42 days but employer may permit accumulation upto 180 to 240 days and can be encashed.
p m patel

Hi,

As you are working at Surat , I believe , you should first check up local laws . To best of my knowledge , no law permits forced encashment unless the same is at the time of leaving the orgainization or termination . Except these circumstances , rules are framed by each company which may suit their requirement .

As regard leave quantum , these are prescribed under law like , Shop and Establishment Act of a state or the factories Act , as may be applicable. Most of the companies do offer higher quantum to retain employees and form additional rules to take care of their individual reuirement which should not contravene provision of local laws .

Encashment is generally done on Basic + DA . Many a companies do follow this practice but are found to be falling short of legal requirement . Certain pronouncements suggest that leave encashment is to be done on Monthly Gross as if a person is on leave . You may have to work out total burden on such change before you appraoch your management for revision.

Hope, these inputs shall be some help to you for decision making.

Regards,

Rajpal

hi,
In most of the Corporate companies are following as per details given hereunder:
1. SL = 7 days in a year & it carries forward for next year but upto 28 days which means the max limit of accumulation is 4 yrs. In case, the employees does avail leave and limit crosses then the extra leaves will be lapsed.
2. EL = 30 days in year & it carries foward for next year and credited in the account of employees upto 120 days (in case of MCS) and for staff the entitlement is the same but limit is only 90 days which means the employee in this category can accumulate PL upto 90 days and over & above will be encashed.
I hope the above will help you.
Thanks,
Gyan

dear bhawana
pls make it clear whether your industry is covered under fatories act or shop and establishment act.the suggestions given by friends does not applicable to your industry as your location is in surat than gujrat shop act will apply to u if u are in trading or factories act will apply to u if u are in manufacturing.pls clarify.
tks
j s malik

Pls confirm leave encashment is mandatory for Pvt firm or not ..