Understanding Leave Rules in India: How Do CL, EL, and SL Work with Calculations?

Various leave rules under Factory Rules in India, such as CL, EL, and SL, may kindly be discussed with reference to numerical calculations.

Hi Joy,

Mostly, there are three types of leaves prevailing in organizations:

1. Privilege leaves / Paid leaves / Earned leaves - 16
2. Casual leaves - 8
3. Sick leaves - 8

Out of these leaves, casual and sick leaves can be availed only during that financial year, whereas Privilege leaves are carried forward to the next financial year and can be encashed.

In some companies, Privilege leaves get encashed on a yearly basis, while in others, it happens only at the time of separation from the company.

The details are as follows:

Earned leaves / Privilege leaves: These are the leaves earned in the previous year and enjoyed in the preceding years. Also known as privilege leave, these can be carried forward for a quantum of up to three years and vary from state to state as per the shop and establishment act. They are encashable on the basic salary of the employee. The conditions for taking these leaves usually differ from company to company but typically require a notice in advance of at least 15 days. These leaves can be clubbed with sick leave if the sick leave balance is insufficient.

Casual Leave: These leaves are granted for unforeseen situations or when you need to take one or two days off. Normally, companies restrict casual leaves to a maximum of 3 days in a month. In these cases, the person must either seek permission in advance or adhere to regulations upon joining. Casual leave is usually not combined with Privilege leave but can be with sick leave if there is no sick leave balance. The quantum varies from state to state as per the shop and establishment act, and typically, this leave is not encashable or carried forward. At the end of the year, the remaining casual leave balance may be converted to Privilege leave in the leave account to reduce absenteeism.

Sick Leave: As the name suggests, these leaves are for when an employee is sick. The quantum is determined by the shop and establishment act in different states. Sick leave can be carried forward if there is a balance, with the logic that severe illness may require medication and leave during that period, usually recommended to carry forward for up to 45 days, or it will lapse. Accumulating sick leave also helps reduce absenteeism due to minor illnesses. If a person is sick for more than 3 days, they are typically required to attach a medical certificate.

Maternity Leave: It is typically granted for 12 weeks, with six weeks before delivery and six weeks after. The lady must submit a fitness certificate before resuming duty. Further details on this leave have been explained by Ms. Shilpa.

Leave without pay: If a person has no leave balance and the situation warrants leave, it may be granted as loss of pay, which can be adjusted against future leave or, as a special case, special paid leave based on the person's contribution to the company at management discretion.

Compensatory off: These leaves are granted if a person works during holidays, typically compensated as leave to be taken or as an encashable option.

Regards,

Amit Seth

Dear Joy,

You might have received the various kinds of leave rules that are existing in various concerns. As far as Government servants are concerned, there is a separate set of rules that exist. Concerning the Andhra Pradesh Government, the A.P. Leave Rules, 1933 are in existence with several amendments for the benefits of its employees.

I will explain the various leaves hereunder as per APLR-1933.

Casual Leave:- There is a provision to avail 15 days of Casual leave in a calendar year. If you do not avail the 15 days, the balance of leave will be lapsed.

Earned Leave:- There is a provision for 30 days of earned leave (paid leave) for every employee, i.e., 15 days will be credited every six months. This earned leave is a permanent leave without any lapse. You can avail the leave whenever required with full pay. The balance of leave will be added to the next year, until the retirement of the employee. After retirement, the entire balance of leave will be culminated into cash subject to a maximum of 240 days and paid to the employee in cash as per the rate of pay on that day. That is Leave encashment on retirement. Moreover, there is a provision for the surrender of 15 days of earned leave every year or 30 days of earned leave once every two years for encashment purposes. The earned leave will be reduced to that extent, and leave encashment will be paid to the employee.

Half-pay Leave:- There is a provision of 20 days of half-pay leave per year. This is also a permanent leave and is carried forward to the next year, until the retirement of the employee. However, there is no leave encashment benefit. However, subject to certain conditions, half-pay leave can also be encashed on retirement. The half-pay leave can be availed by the Government employee as and when required with half of the pay. However, due to emergency circumstances under Medical grounds, half-pay leave can be availed by commuting the half-pay leave into full pay. That means, you can avail 40 half-pay leaves for 20 full days' payment of salary on Medical grounds. This is what is called "Half-pay leave commuted into full pay."

Leave Not due:- There is a provision for the sanction of leave not due, i.e., leave can be sanctioned even though there is no balance of any leave to the credit of the Government employee, subject to the condition that the quantum of leave period will be deducted from the future leave accrued in his service. This facility is the prerogative of the Government in special circumstances, but not as a matter of right of the employee.

Study Leave:- There is a provision for the sanction of study leave to the extent of 5 years with or without pay depending on the circumstances of the case. The Government is only competent to sanction such leave in special circumstances under Public Interest, but not on the request of the employee. This is a rare leave, and certain higher categories of employees are eligible to receive Study leave under special circumstances, but not routinely.

Extraordinary Leave:- This is leave without pay. If the employee does not have any credit in his leave account, he can request the authorities to sanction extraordinary leave (i.e., Leave without pay and allowances). The extraordinary leave can be sanctioned up to 5 years with the permission of the Government, however, under special circumstances and on the request of the employee.

Maternity Leave:- Maternity leave is entitled to be availed by every Women Government employee subject to the production of a Medical Certificate. Maternity leave is extended up to 4 months with full pay and allowances. However, the Government has restricted this leave to be availed by women government servants for two Confinements only.

Paternity Leave:- It is under proposal by the Government. It is meant for male Government servants to look after their wives during delivery time and to attend to their wives and children. It has not yet been materialized in implementation, but there is a proposal to give benefits of this type of leave to Male Government servants, as it is in vogue in some Private Organizations.

As per the Fundamental rules of the Government of Andhra Pradesh, Leave (except Casual leave) cannot be claimed as a matter of right.

Suribabu Komakula

Dear Sir,

Thank you very much for this clear explanation. I have a question regarding the Leaves Module of a company. Does it depend on the company's policy? Previously, when I was working as a worker in a limited company, we had a total of 32 leaves per year:
- SL: 9 per year, but we could only take 2 in a month; if more than 2 were taken, they were not paid.
- CL: 9 per year, similar to SL; could only be used from April onwards and not carried forward. If CL remained, it could not be encashed as they lapsed.
- VL: Village leave, total of 14 per year; we could take all in one month, and it carried forward to the next year.

I would like to ask if this is the right policy to apply leave rules. Are leave rules different for workers and management personnel?

Kindly provide an answer.

Thanking and regards,
Priyanka Khadpe
Mumbai

Hi Amit,

I would be highly obliged if you could explain which leaves can be encashed in Full and Final settlement after resignation. Additionally, I am curious about how we can compensate for the notice period. In other words, which leaves can we utilize in place of the notice period.

Thank you.

Guys, let me know to what extent ML can be adjusted towards PLs and what are the legal consequences for the CO.

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Guys,

Please let me know to what extent ML can be adjusted towards PLs and what are the legal consequences for the CO.

Hello Board,

Can anyone let me know whether we need to include Government Holidays or Weekends while calculating CL/SL/PL-EL? I would appreciate your immediate response.

Thanks,
Prem

Please let me know if a female employee has taken a 3-month leave, will her leave balance—for example, 2.5 days—be added every month for the next 3 months? Similarly, if an employee is sick for one month, will their 2.5 days leave eligibility be added for that month? Your advice is appreciated.

Regards,
Anand Raju

These inputs are really helpful and informative. Though we generally follow the trend in a company, it is nice to have the understanding as explained by Amit Seth and Suribabu Komakula. Thank you to both of you.

Regards,
Marian

If an employee takes a half-day leave on Saturday and a full-day leave on Monday, does Sunday count as leave or not?

Excellent explanations on the various types of leave. Can you please clarify a point on the sick and maternity leave? Amith Seth mentions Sick Leave at 8 days to be valid only during that financial year, and any balance carried forward up to 45 days.

- The 8 days during the financial year - is this fully paid sick leave or unpaid?
- Once any balance is carried over to the next financial year - is it then considered unpaid?

Maternity Leave - is this fully paid or only a %?

Many thanks

I wanted to know:

1. In case there are no balance leaves in my account and I've taken a continuous 14-day leave including non-working days, should they charge LOP for non-working days as well?

2. My boss asked me to leave the organization on 20th March with an offer of 1-month salary. So, I took leaves (balance amount) and accepted his offer. Now, he is giving me 15 days' salary only by saying that I was on LOP. How should I go about this? I am planning to say that I am not leaving the job (no written agreement), and at the end of this month, I will be eligible for a bonus. Can I claim the bonus (after 1-year eligibility, mentioned in my offer letter) as he is laying me off?

If an employee has taken half a day on Saturday and a full day on Monday, then Sunday will be considered as leave.

For example, if an employee took half a day of sick leave on Saturday and requested one day of casual leave on Monday, then the employee must cancel the casual leave for Monday and instead apply for 3.5 days of sick leave (i.e., 0.5 day for Friday and 3 days for sick leave covering Saturday, Sunday, and Monday). The applicability of this process also depends on the company's leave policy. Some companies allow for this type of leave merging, while others do not.

Thank you.

Let me express my views on the thread for the sake of simplified clarity since the various questions posed one after another converted it into that of a questionnaire.

In employment parlance, the term 'leave' connotes a special meaning that it is a period of time for which an employee is allowed to be away from work for a special reason. It is therefore different from 'holiday' in that a holiday is a total closure of work, as such no permission is necessary, whereas leave is absence with permission from work.

The Idea Behind Granting Leave

The idea behind the grant of leave for employees is two-fold: the first one is to permit an employee to enable him to discharge his social obligations such as attending a marriage, calling on an ailing relative or a friend, etc., like any other member of society and meeting certain unforeseen contingencies like sudden indisposition of a family member or self; the second one is to permit him/her to rejuvenate himself/herself for a certain spell of time free of physical and mental pressures of work so that his productivity or capability to work is maintained at the optimum level.

Almost all the labor enactments applicable to particular types of industrial establishments do have special provisions relating to leave and holidays for employees depending upon their nature of work. In respect of managerial cadre employees, industries themselves devise their own leave policy and incorporate it into the service regulations of such people for the sake of uniform application.

Leave Provisions Under the Factories Act, 1948

Since the opening of this thread started with the kinds of leave in factories, I shall also start with the leave provisions of the Factories Act, 1948. Other than the weekly holiday mentioned in Section 52 of the Act and maternity leave of 6 weeks prior to or after delivery permissible to eligible women workers under the Maternity Benefit Act, 1961, the only leave available to factory workmen is the Annual Leave with Wages allowed under Section 79 of the Act. It is permissible subject to the condition of working for 240 days or more in the previous year. That is in the case of an adult workman, leave will be allowed in the subsequent year at 1 day for every 20 days of work performed in the previous year and in the case of a child, 1 day for every 15 days. The days of lay-off, maternity leave not exceeding 12 weeks, and the leave earned in the year prior to that in which the leave is enjoyed will be treated as worked days for the purpose of computing the 240 days. The maximum number of days accumulated is 30 in the case of an adult and 40 in the case of a child. Encashment of unavailed number of days is permissible immediately on termination on account of discharge, dismissal, resignation, superannuation, or death. Leave shall be applied for permission before 15 days; if denied, the applied number of leave should be allowed to be carried over.

Leave Provisions for Shops and Establishments

In the case of employees in shops and establishments, generally provisions for the grant of casual leave, sick leave each at 12 days a year, and privilege leave at 12 days are given in the respective State Enactments. Only privilege leave can be accumulated to a maximum of 24 or more days as in respective Acts. Unavailed portions of P.L should be paid on any kind of termination; S.L only on death.

Leave Provisions for Contract Labor

In respect of contract labor, the leave provisions of the law applicable to the principal employer's establishment are applicable.

General Leave Considerations

Generally, holidays falling within the period of earned leave or prefix and suffix of holidays are permissible.

It should be borne in mind that it cannot be claimed as a matter of right; sanction is always subject to the exigencies of work only.

Yes, that is the case in many companies. Nobody follows the rules as set by the Factories Act, and the rules for management staff are kept different.

After the completion of casual leaves, late presents are deducted from the leaves in Andhra Pradesh government.

Hi, I am working for an educational institution run by a trust. I would like to know about the types of leaves available, how to use them for vacation and non-vacation time, and also the accumulation and non-accumulation of leaves. We have permanent and non-permanent staff here.

Assist me in this.
AG

Dear Sir,

Thank you so much for sharing with us. I want to ask a question: if I have CL, SL, and EL, can I take EL? If I want or the organization says that first, you have to adjust EL, then CL and SL, is it possible?

I apologize for the mistakes in English as I am weak in English.

From the very names of the leaves, you can understand that they are meant for different purposes. So, there cannot be any fixed order in which they have to be availed of or sanctioned. CL is meant for unforeseen circumstances, and SL is meant for sudden illnesses lasting for a short period, and both of these can be availed of within the calendar year. However, EL becomes operative only in the succeeding year as per the requirement of the employee, such as a vacation, subject to prior sanction of the employer. The combined enjoyment of these leaves depends upon the leave policy of the employer.

Regards,
Pradeep

Leave Policy for a Startup Event Management Firm

I am setting up the leave policy for a startup organization (an event management firm) as per the following basic guidelines:

Privilege Leave

1.5 days per month (Total 18 days in a year) credited at the start of the calendar year. An employee is entitled to PL on completion of probation. This can be availed all at once by giving prior notice of at least 15 days to the management. 50% of PL could be carried forward to the next calendar year, and the remaining leaves will lapse at year-end. A maximum of 30 days can be accumulated as leave balance at any point in time.

Casual Leave

0.5 days per month (Total 6 days in a year). New joiners can avail CL from the date of joining. No carry forward for CL as it will lapse at year-end if not availed. CL will not be granted for less than 1/2 day and more than 2 days at a stretch. Intervening holidays will be counted as part of CL. Request for CL must be made and approved at least 3 days in advance. CL cannot be clubbed with privilege leave while taking leaves.

Sick Leave

0.5 days per month (Total 6 days in a year). New joiners can avail of SL from the date of joining. No carry forward for SL as it will lapse at year-end if not availed. If an employee avails of SL for more than 3 days, a medical certificate should be submitted along with the leave application within 2 days of joining. Any National & Festival holidays or weekly holidays prefixing or suffixing or falling in between the leave applied shall not be included. SL can be clubbed with CL for availing leaves. In the case of serious long recovery illnesses, the employee may request additional SL with pay, only when other types of leaves have been exhausted. Additional leave will be at the discretion of the management and cannot be assumed to be a right of the employee.

Please state if the above guidelines are in compliance with the Karnataka Shops and Commercial Establishments Act and other relevant labor laws. Please note the current employee strength is 11, including the proprietor, and is based out of Bangalore.

I would value your suggestions regarding any possible amendments in the above policy. Please advise regarding the carryforward of PL as I have read so many different versions and each organization seems to differ.

Thanks in advance!!

Best,
Sylvia

Please tell me, can I avail the earned leave encashment (with previous year EL carried forward) for the period January 2016 to April 2016 while leaving the job?

Hi, I need one small clarification. If we take sick leave continuously, does it include Sundays and national festival days in the calculation? Please help me. I believe that only Sundays and national festival days are counted in earned leave. However, I am unsure about sick leave.

Hi all, I have joined a new company (Pvt Ltd) a month ago in Chennai. Could someone please brief me on the Earned Leave policy as per the Tamil Nadu Shops and Establishment Act? When is an employee eligible (after how many months of service) for Earned Leave and how many days of Earned Leave are allowed?

My company's consultant says I can avail Earned Leaves only after completing 1 year in the organization. I will receive one EL per month, but I cannot avail them until I complete one year. The company's probation period is 3 months.

Previously, I worked in Mumbai for another organization where, post-confirmation (6 months probation), I could avail earned leave.

Kindly advise.

Thanks and Regards, Hazel

Leave Entitlement Under the Shops & Establishment Act

I have one question to ask. One of my friends is working in a proprietorship company that is not yet registered in Mumbai. My query is that this employer only allows 11 EL in a financial year, out of which he says you have to take 4 mandatory days off according to his wish, and the remaining 7 EL you can avail according to your need. Additionally, he gives no sick leave. If I am not mistaken, according to the Shops & Establishment Act, an employer should provide 1 EL for every 20 days worked, meaning in a year, an employee is eligible to take 18 EL.

Seeking Clarification on Legal Provisions

I need some help from you guys. Is there any provision under the Shops & Establishment Act where they can legally demand at least 18 EL in a year? Your reply will help many employees from this organization. This organization deals in real estate sales.

Thanking You,

Farhan
HR Head, BUN

Dear Sir,

According to the Andhra Pradesh Shops and Establishments Act, what is the leave policy?