Sick Leave Requirements in New Factories: Is It Mandatory and How Many Days?

Dear Seniors, please help me out with this problem. Ours is a newly established factory, and we need to configure the leave policies for it. Can anyone please tell me if it is mandatory to provide sick leaves to workers as per the Factory's Act and other relevant acts? If so, kindly guide me on how many sick leaves should be given as per the act. Please consider this matter important and provide guidance at your earliest convenience.

Thank you.

Leave Policy Requirements for Factories

No, it is not mandatory under the Factories Act, but you need to provide annual leave. However, if your factory is covered by the Standing Orders Act and the state model standing orders provide for sick leave, you may have to include the same in the standing orders of your factory.

Regards,
B. Saikumar
HR & Labour Law Advisor
Mumbai

Annual Leave Under the Factories Act

In the Factories Act, Section 79 only discusses annual leave, i.e., 1 day of leave for every 20 days of work. This is applicable only after completing continuous service for 240 days in a year, making you eligible.

Sick Leave and Other Leave Policies

Sick leave is not discussed in the Factories Act. If your establishment has certified standing orders, then you will have to follow the leave structure as depicted. Additionally, if it is covered under the Shops and Establishments Act, then you will have to follow sick leaves, casual leaves, and earned leave as per your state's Shops and Establishment Act.

Regards,

Understanding Leave Sanctioning Authority

We are under the wrong notion that we have the power/authority to sanction leave to an employee beyond what is permitted under the Factories Act/Shop Act or the Standing Orders/Agreement with the Union or the Appointment order.

Handling Leave Requests

If an employee requests leave and has already exhausted all eligible leave, and the Management decides to permit the absence, then the employee has to be marked as Authorised Absence ("AA"). In other cases, they have to be treated as on Unauthorised Absence ("UA").

Medical Absence Considerations

In the case of absence on medical grounds and if the absence could be permitted, the employee may be marked as Medical Absence ("MA") (this may be followed for absence with ESI certificates).

Does the Factories Act or Shops Act prohibit employers from granting leave beyond what is provided under the respective Acts? If so, under what provisions of the respective Acts?

Regards,
B. Saikumar
HR & Labour Law Advisor
Mumbai

Thank you for your immediate response. The Acts do not prohibit the sanction, but at the same time, the employer cannot have the power to sanction "leave" beyond what is permitted as per the Acts. If the employer wishes to have such a right, it should be mentioned at least in the Standing Orders, Appointment Orders, or Agreement with the Union.

Regards

You can pay sick leave for 7 days in a year. However, if you are covered under the ESIC Act, there is no need to pay.

Leave Policies Overview

Leave policies vary from company to company. You can provide leaves under the Factory Act:

1. One Earned Leave for every 20 working days, which carries forward to the next year.
2. Casual Leave for 7 days in a year, which lapses within the year, regardless of whether gained or not by the employee.
3. Sick Leave for 7 days in a year. If an employee is absent due to fever or illness, they should utilize ESIC. ESIC will pay them leave with wages.

Regards

The Acts still permit employers to provide for leave beyond the Acts themselves.

Regards,
B. Saikumar
HR & Labour Law Advisor
Mumbai

As per the model standing orders, we may permit 10 days of casual leave instead of 7 days. This is for your information only.

Regards,
Abubakkar