Dear Balaji,
You may like to review your reply, as there seems to be some contradiction in that.
For example, facility of medical allowance is granted to the employee to compensate the expenses incurred by him/her on his own treatment or that of his family members. Your contention is that in the case of leave with loss of pay, he/she would lose medical allowance also. Suppose the employee fell ill and is under treatment for long and for that reason only he/she is compelled to remain on leave without pay there being no other kind of leave at his/her credit, would the management be right to deny medical facility to its employee, if the company does not have the policy of medical reimbursement?
Similarly, if in the same case of his/her long illness and leave without pay, as above, would he/she lose the benefit of HRA also, when he is incurring expenditure on rent for his/her accommodation?
You, as well as other seniors, need to think very seriously on these points before making any final opinion.
In my views, until the HRA and Medical Allowance are calculated and expressed specifically in terms of certain fixed percentage of the basic salary, the management would not enjoy the right to deny these facilities to the employee, more particularly for his medical treatment.
So, I am of the opinion, if medical and HRA are treated as allowances and allowed as some fixed amount (not in terms of percentage to the basic salary), it does not have any relation with the basic salary and cannot get any effect by the kind of leave or the amount of salary in lieu thereof to the employee. However, for HRA purposes, the employer is free to stipulate some condition for allowing that for certain fixed duration of leave of any kind, i.e., 4 months or 6 months, etc. But that specific provision has to be made part of the Employee Manual/ Leave Rules of the company, besides the agreement with or appointment letter of the employee.
So, until the company formally makes such provisions, HR would be quite wrong to deny these benefits to the employee merely on presumption basis. Any litigation-happy employee can get these benefits through court of law, in the absence of such provisions in the rules of the company.
So, you may like to review your opinion on the issue.
PS Dhingra
CEO cum Management & Vigilance Consultant
Dhingra Group of Consultants
New Delhi
09968076381
[dcgroup1962@gmail.com]