Leave Encashment In F&F

Dear Seniors,
I need a clarity on encashment of Paid Leaves in F&F. Do we need to calculate on the basic or on gross? suppouse if 25000 is the gross salary of an employee and he have 20 paid leaves while exit, in F&F do we need to pay him 16,667 ((25000/30)*20) or 6,667 ((45%*25000)/30)*20))
Please suggest me.
Thanks,
Raam..

depends on company policy... but basically calculated on basic salary, The formula for earned leave encashment is
Basic Salary / 26 * Nos of Earned Leave Balance.
But you can take Gross Salary instead of Basic, if your company policy allowing that.

Hi Raam,
Leave Encashment is generally calculated on Gross salary of any employee.
Gross Salary * No. of earned leaves /30 is the right formula. please check with your management regarding the leave encashment policy.