How Should We Credit Leave for New Employees on Probation Mid-Year? Seeking Advice!

We are working on a leave policy as our organization has not yet framed a leave policy. My company has decided to provide a total of 30 earned leaves in a year. Our company is covered by the Shops and Establishment Act. I would like to know how to credit leave for employees who join in the middle of the year and are still under probation. Any suggestions would be appreciated.

Regards

Hi Saji, Thanks for your reply. I would like to inform you that I have gone through CiteHR's different policies on leave. I need a little help to make my policy better. I just want to know if I need to credit leave to employees during the probation period as, per the act, only Earned Leave (EL) is provided.

Regards

The EL/PL eligibility requires a minimum of 240 days of tenure with the company. If your company would like to provide it on a pro-rata basis, you can give credit. Please refer to your State S&E Act or Factory Act for further knowledge.

Thank you for your prompt response. I am drafting a policy as per the S&E Mumbai Act where employees will be eligible for Earned Leave after confirmation. Please correct if there are any errors.

Regards

When drafting or forming any policy, you must refer to all applicable laws. Understand certain terms defined and undefined therein.

Forming a Leave Policy

You are forming a leave policy. You should first determine what kind of leave you are liable to provide to your employees and the minimum quantum. Identify under which enactment you are liable to give those leaves and what conditions are attached to them.

In general, any law or enactment and the rules attached thereto are not specific and are subject to interpretation. You need to have expertise in the interpretation of law when you assume such responsibilities yourself.

Understanding Earned Leave

To be entitled to earned leave, one has to work for it. Generally, this kind of leave is earned by a person by working in the previous year. When you understand all such aspects, you will find answers to your questions, such as whether the employee will get earned leave during probation or not, and what quantum of earned leave should be credited or given when the employee joins in the middle of the year.

Dear Queriest, it is not my intention to withhold specific answers, but understand that there is no specific answer.

I support our learned member Mr. Sajji, who said members should learn themselves.

Regards

Earned Leave Entitlement

To be entitled to Earned Leave, one must work for a specified period. Under the Factory Act, leave is earned by a person working 240 days in the previous year. The Shops Act of the State provides for a certain period. For example, the Delhi Shops & Establishment Sec. 22 (a) provides 15 days of PL/EL after having served 12 months. Subsection (2) contains provisions that if an employee has completed a total period of four months in continuous employment, they shall be entitled to 5 days of privileged leave for every such completed period.

The Punjab Shop & Establishment Section 14 (1) states that every employee who has been in employment for not less than 20 days in a year shall be entitled to one day of earned leave for every such 20 days. There are no conditions that the employee should have been in continuous employment for 240 days in the preceding twelve months.

Thanks & Regards,
RL Dhingra
Advocate, Delhi
Labour Law Consultant
[Phone Number Removed For Privacy Reasons]
[Email Removed For Privacy Reasons]

The eligibility for statutory leave (EL or PL) is 240 working days at present. If an employee works for 240 days, they will be eligible to earn leave—1 day for every 20 days, subject to the actual number of days worked in the preceding year. This rule applies to both probationary and confirmed employees.

If an employee joins in the middle of the year, their eligibility for earned leave should be a minimum of two-thirds of working days completed from the date of joining until the end of the year, as per the act. Your company has decided to provide 30 days per year, and then you can calculate one day for every ten working days. I hope this explanation is clear to you.

Regards,
Adoni Suguresh
Senior Executive (Personnel, Administration & Industrial Relations) Retired
Labour Laws Consultant

It is only under the Factory Act that if a worker has joined on the 1st day of January and has continuously served for 240 days during the preceding 12 months, they are entitled to leave with wages at the rate of 1 day for every 20 days of actual work. The Shop Act of different states provides somewhat similar provisions. If a worker joins in the middle of the year, their eligibility for earned leave shall be a minimum completion of two-thirds of working days from the date of joining until the end of the year. Leave entitlement will be at the rate of 1 day for every 20 days. The period of 20 days will include any weekly rest day, paid holiday, period of authorized absence due to sickness, closure of the establishment, layoff, or strike, which is not illegal. Earned leave cannot be availed in more than three spells.

Regards