Can Factory Employers Limit Leave to Only Earned Leave Due to Factory Act Rules?

As Casual Leave and Sick Leave are not mentioned in the Factory Act, can the employer only provide Earned Leave (EL) for the employees working in the factory?

Leave Policies Based on Leave with Wages Policy

All the leave policies are based on the Leave with Wages policy. As per this policy, apart from Earned Leave (EL), you shall provide 12 days of Sick Leave.

But there are CL (Casual Leave) and SL (Sick Leave) rules framed by state governments, and we have to follow them.

The State CL and SL rule is only applicable to shops and establishments. Is it applicable to factories as well? I heard that if a company falls under the Factories Act, then the Shops and Establishment Act will not be applicable. Could you please clarify this for me?

Thank you.

State Laws for Casual Leave (CL) and Sick Leave (SL) for Factory Workers

Which are the laws framed by state governments to provide Casual Leave (CL) and Sick Leave (SL) to factory workers?

Regards,
Varghese Mathew

Any company registered under factories will not come under shops & commercial. However, all these leaves are covered under the Leave with Wages Act. The Inspector of Shops Act can come and ask for details such as the Leave with Wages register, annual returns, Gratuity Act, Maternity Benefit, etc.

Any company registered under factories will not fall under shops & commercial. However, all these leaves are covered under the Leave with Wages Act. The Inspector of Shops Act can come and ask for details such as the Leave with Wages register, annual returns, Gratuity Act, Maternity Benefit, etc.

Understanding the Leave with Wages Act

I have heard about the Payment of Wages Act, but what is this new act, the Leave with Wages Act?

Regards

According to the Factory Act, if an employee works for 240 days or more during the calendar year, they will earn 12 leaves. However, each company will design its own leave policy, as there are no specific rules or acts applicable in this regard. The entitlement to 12 Earned Leaves (EL) is as per the Factories Act.

Regards

Leave Provisions Under the Factory Act

As per the model standing order, there is a provision for 10 days of leave, with or without pay, accordingly. Many companies have their own rules as mentioned above in the Factory Act. Twenty working days equal one earned leave, called PL or EL. Otherwise, there is no provision under the Factory Act for CL or SL.

Annual Leave with Wages

As per the Factory Act section mentioned below:

79. Annual leave with wages (1) Every worker who has worked for a period of 240 days or more in a factory during a calendar year shall be allowed leave with wages for a number of days calculated at the rate of:
i. If an adult, one day for every twenty days of work performed by him during the previous calendar year;
ii. If a child, one day for every fifteen days of work performed by him during the previous calendar year.

Thanks,

Regards,
J L Trivedi
Ahmedabad

A plant/factory should be registered under the Factory Act without saying, and the leave will be regulated in accordance with the Factory Act. In the Factory Act, it clearly stipulates that if a worker works for 20 days, 1 day of leave is earned by him. It means that if a worker has worked 240 days or more in a calendar year, he shall be allowed 1 day of EL/PL for every 20 days worked. So, his earned leave will be calculated accordingly.

If an office/establishment is registered under the local Shop & Establishment Act, the leave will be permissible as per such Act.

If there is any agreement between the management and the union pertaining to wage settlement, including leave and other matters, then it will be regulated in accordance with the terms of settlement. But under no circumstances will leave be less than the statutory provision of the aforesaid Act. If both parties have agreed and signed a settlement, allowing SL and CL apart from EL, then they are bound to follow the same as per the terms of the agreement.

Many of the above points are correct, but let me clarify below. Sick Leave is available through ESIC for those covered under ESIC; otherwise, provide 7 days of Sick Leave. You can skip Casual Leave.

The information provided is in accordance with the Factory Act.

Thanks,