Can Earned Leave Be A Part Of Salary Component?

Hello HR Professionals,
I have a query. Can Earned leave be a part of salary component ?. I work for a IT company and the salary component has EL as one of the component, apart from Basis pay, HRA, Travel allowance and special allowance.
Can anyone thow some light on this please?
Thanks.
Kavitha

EL encashment is part of salary component if encashed. The encashment is subjected to PF and I.T. deductions.
Pon

Dear Kavita,
Its defenetly not...
Lets understand the what is the meaning of EL, earn leave in calculated for pro -rata basis on actual working day & leave are provided to employee to avaid the benefits to take leave, whenever they needed, which is their rights as per law.
but, EL component can be shown only at time of Encashment, eighther on year end or at time of full & Final settlement. it can't be treated as monthly fix salary component.
if you putted as fixed, then you are not providing any leave benefits to employee as you are paying the payment against it, which it wrong, as it treated as company is against taking a leaves or trying to stop employee to avail the benefits as indirectly which rights is provided by law to employee.

Yes - many companies follow this system to give you a boosted amount of the CTC at the time of interview. So you must ask the employer to give you a complete detailed breakup of the CTC at this time, instead of repenting afterwards.

Earned leave is classified as one kind of leave allowed and it can not be treated as salary. But if any part of Earned leave is allowed by the Company for encashment i.e. called otherwise surrender of earned leave, then the leave salary for such encashment will be included in salary for Tax purposes. If the same encashment of leave is allowed at the time of retirement of the employee, then it is exept from tax subject to a ceiling of Rs.3.00 lakhs and salary got more than Rs.3.00 lakhs is chargeable.
Hope you are fully clarified on this matter.
With regards,
ramanathan
HR Consultant/ Attorney
09994675721

Dear Ramanathan,
Thank You very much for the inputs. This info will help me to put forward my views to the management and hopefully to review the current salary structure.
Thanks again.
Regards,
Kavitha