Are Our Leave Policies Compliant? Seeking Urgent Advice on Construction Company Standards

I am working in a construction company as an HR. In my company, we give 16 paid leaves to employees after confirmation and 13 national and local holidays. So, is that fine? I have read that, as per the Shop Act, employees should get a minimum of 21 paid leaves in addition to national holidays. Please suggest a good option so that I can implement it in the company. It's very urgent; please help.

Regards,
Anushka

Understanding Leave Entitlements Under the Shops & Establishments Act

According to the Shops & Establishments Act:

- **PL (Paid Leave):** Not less than 15 days after every 12 months of continuous service. Provided that if an employee completes a period of 4 months in continuous employment, they shall be entitled to not less than 5 days of PL for every such completed period. PL can be accumulated up to 3 years (i.e., up to 3 times the period of leave to which the employee is entitled after one year). If an employee separates before they have been allowed PL, the employer shall pay them full wages for the period of leave due to them.

- **SL/CL (Sick Leave/Casual Leave):** SL or CL not less than 12 days in a year, provided that if an employee completes a period of 1 month in continuous employment, they shall be entitled to not less than 1 day of CL for every month. SL/CL need not be accumulated beyond one year.

Hi Anushka, apart from PL and the national holidays, does your company provide any leaves, such as CL and SL?

No, we are having all-in-one that is PL; SL; CL = 16 + national & local holidays.

Regards,
Anushka

"The correct version of the text with spelling, grammar, and formatting corrections:

Leave Policy Clarification

But the Act says you need to have SL/CL - SL or CL not less than 12 days in a year, in addition to PL - Not less than 15 days after every 12 months of continuous service.

Please let me know if you need further assistance.

As per the Factories Act, 1948, the minimum number of paid leaves that should be provided to employees is 12 days per year, in addition to the national and festival holidays.

In your case, the company is providing 16 paid leaves and 13 national/local holidays, which is higher than the legal minimum requirement. This is a good practice and compliant with the statutory provisions.

Options to Enhance Leave Benefits

However, if you wish to further enhance the leave benefits for your employees, you can consider the following options:

Increase the number of paid leaves

You can consider increasing the number of paid leaves from 16 to 21 days per year, aligning it with the minimum requirement under the Shop Act.

Introduce Casual Leaves

In addition to the 21 paid leaves, you can introduce a separate category of Casual Leaves, say 5-7 days per year, which the employees can avail as and when required.

Combine Paid Leaves and Casual Leaves

You can combine the paid leaves and casual leaves into a single "Paid Time Off" (PTO) policy, where the employees have a total of 26-28 days (21 paid leaves + 5-7 casual leaves) that they can avail as per their requirement.

Introduce Sick Leaves

You can also introduce a separate category of Sick Leaves, say 10-12 days per year, which the employees can avail in case of illness or medical emergencies.

The key is to ensure that the overall leave benefits are competitive and align with industry standards, while also complying with the statutory requirements. It's always advisable to consult with a labor law expert or your legal counsel to ensure that the leave policies are in line with the applicable laws and regulations.