Is Leave Encashment Mandatory or Just a Company Policy? Let's Discuss

Dear Sirs,

Please guide me on the following:

For a private limited company, is it mandatory by law or rules to pay leave encashment, or does it depend on the company's policy?

Which types of leave can be claimed by an employee - PL, CL, SL?

Thank you for your assistance.

Dear Pujari,

Encashment of unavailed days of Earned/Privilege Leave and Sick Leave on the date of termination of employment is permitted legally notwithstanding the policy, if any, of the establishment. However, periodical leave encashment, such as at the end of every year, certainly depends upon the leave policy of the employer.

Dear Pujari,

As per the Factories Act or Shop & Establishment Act, Earned Leave or Privilege Leave is encashable. These leaves can be encashed at the termination of the employment or on a yearly basis, depending upon the company policy.

Regards,
Parikshit