Understanding Earned, Sick, and Casual Leave Under The Shop and Establishment Act – Can You Help?

Hi,

Can anyone guide me on the earned leave, sick leave (if applicable as per the Act), and casual leave (if applicable as per the Act) to be availed as per The Shop and Establishment Act? I am aware that the Factory Act mentions that for every 20 working days, 1 earned leave is to be availed, but according to the Shop and Establishment Act, I think it is different.

Please help me to understand about PL, SL, and CL.

Regards,
RC

Dear Reshma,

According to Shop & Establishment rules, the leave entitlement in a year is as follows:
- EL: 15 days
- CL & SL: 12 days

There is no specific breakdown for CL & SL; you can treat them as you prefer. If you need any further clarification, please let me know.

You are most welcome.

Vineet Mittal

Dear Vineet,

Thank you very much for providing this information. Could you please elaborate on the following points:

1. What is the basis for calculating 15 PL? For example, how many working days is 1 PL equivalent to?
2. Does the same question apply to SL and CL as well?
3. What are the encashment clauses, i.e., the limits for carrying forward leave?
4. Additionally, which of the three types of leave gets lapsed?
5. Does ESIC provide benefits for sickness, meaning that SL is only used by employees not covered by ESIC?

Regards,
RC

Dear Reshma,

These rules are according to the Shop & Establishment Act in Delhi. Since you are from Mumbai, you have to refer to the Shop & Establishment Act in Mumbai.
I can give answers to all questions, but they will be based on the Delhi regulations.

Bye,
Vineet

Hi,

I have recently joined a KPO which comes under the Shop & Establishments Act. I wish to know what registers/documents I need to maintain. Please help me.

Please email me at deepakkumarmalik@gmail.com.

Regards,
Deepak Malik

Hi,

I have newly joined a KPO that falls under the Shop and Establishment Act. I am not aware of this act and do not have any kind of experience. We are hiring people not on the payroll but as consultants at Rs. 250/- per hour. Do we need to be bound to pay ESI/PF to them?

Please help me out because we have to file some documents ASAP.

Please email me at deepakshamli@rediffmail.com or deepakkumarmalik@gmail.com.

Thanks & Regards,
Deepak Malik

Dear Vineet,

Thank you very much for providing this information. It would be helpful to understand more about the Delhi Shop & Establishment Act in relation to the following points:

1. What is the basis for calculating 15 PL? For example, how many working days is 1 PL proportionate to?

2. Is the same question applicable to SL and CL?

3. Could you explain the encashment clause and the limit for carrying forward each of these types of leave?

4. Amongst the three types of leave, which one lapses?

5. ESIC provides benefits for sickness. Is it correct that SL is only for employees not covered by ESIC? Is SL mandatory in any case?

Regards,
RC

Dear Deepak,

In my view, they are not your employees; they are professionals. Therefore, you are not required to deduct PF or ESI. However, at the same time, you have to deduct TDS, which is about 10% for professionals, which is very high. For example, if someone is getting 10,000 per month, in that case, you have to deduct 1,000 as tax.

Thank you.

J.S. Malik

Hi all,

What about the IT industry? What does the act say about CL, SL, and PL in the IT industry?

Regards, Bilahari

As per the standard A.P SHOPS N ESTABLISHMENT ACT, leave procedures are as follows:

PL: 15 per year. It can be availed at 1.25 per month every month or can be availed for up to one year. The clause states that the associate should complete 1 year of service, meaning after confirmation.

CL: Standard 12 days can be availed, with 03 days at a time and once monthly.

SL: As per company norms and as per MNC policy, we offer 12 days per year. However, in case of emergencies, it cannot be carried forward and will lapse at the end of the year, similar to CL. PL can accumulate up to 60 days and then restarts from 1. You can encash 8 days and avail 7 days in the year, specifically in the month of October according to company norms.

From,

Edward
Manager - Human Resources
9963355441