I want to know if an employee has resigned and completed the notice period. How should his leave be settled? Based on the gross salary or basic and DA? Are there any specific rules under labor law?
What is your leave encashment policy for your current employees working in the organization? Please apply the same policy for those employees who have resigned.
I think most of the labor laws specify that leave salary is to be paid at the gross rate. You cannot pay it at basic and DA. However, you need to provide the relevant details of your organization, structure, and location to allow us to give more correct information.
Payment against leave salary may be specified in the personnel policy of the organization. Leave salary will be calculated based on the amount of leave balance after adjustment against the notice period, if required. Sometimes slabs will be fixed for payment of leave balance.
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