Feeling Cheated Over Unpaid Leave: Should I Let It Go or Fight for My Rights?

I resigned from the position of Engineer in a pharmaceutical company after 8 years of service. At the time of leaving, I had 136 earned leave days in balance, but in my full and final settlement, they have paid me for only 60 days of leave encashment. When I asked about this, they said it is company policy. I know that they do not have any such policy, and neither is any such thing mentioned in my appointment letter. They have paid me all other dues like gratuity, bonus, salary, etc., but I feel that I have been cheated as they still owe me 76 days of earned leave, which amounts to more than 1 lakh Rs.

Please advise me on what I should do now. Should I leave the matter and move on, or should I pursue the matter legally? If I should pursue the matter, how should I go about it as I do not know the procedures?

Before deciding to leave the company, you should have checked the company's policy and availed the earned leave in excess of 60 days. If the company is claiming that they have a policy of leave encashment up to 60 days, you can certainly check that point by looking into their company policy or certified standing orders, if your appointment letter doesn't contain such stipulations. If they don't have any such stipulations in writing anywhere, then you have a strong case to move to the labor department of the area for relief.

Regards, BS Kalsi

There can be no such policy if the same has not been communicated to employees officially. The company ought to have paid for the entire balance. If you have proof of leave balance, then you can approach the Government Labour Officer and follow his advice thereafter. They have to pay leave salary based on your gross salary.

The company is right in Gujarat and Maharashtra states, as per the Shops and Establishments Act, earned leave can be accumulated for not more than 3 years, i.e., 21 leaves x 3 years, which is 63 leaves. Over and above 63 leaves, all earned leaves will lapse and are not payable by virtue. Hence, even legally, it cannot be of much help to you.

Thank you, experts, for your prompt responses. I would like to mention that the company does not have any certified standing orders, and there is no official communication to employees as well. My last salary slip has the balance of leaves mentioned therein. Will that be treated as proof?

Also, as per my appointment letter, earned leaves per year are 30 and not 21. If the Shops and Establishments Act states that more than 60 leaves cannot be accumulated, then was it not the responsibility of the company to encash the excess leaves at the end of the previous year? Not only have they never encashed earned leaves at any time during my tenure, but they have also carried forward and mentioned the balance of leaves in all salary slips. As I mentioned, my last salary slip shows an EL balance of 136.

Thanks again for the valuable tips. God bless you all!

Since you have slip showing leave of 136, the company cannot retract from it and is obliged to pay leave salary for 136 days. As per the Maharashtra Shops Act, wages for the calculation of leave will be based on gross wages.

Dear Sudeep,

Kindly refer to the leave policy of your company to have a better understanding. The company does not allow encashment of leave money; instead, employees must claim their leave or encashment of leaves before they expire. If the payslip displays leave accumulated up to 136 days, it is an error on the company's part. You can bring this to the attention of the management for clarification.

Thank you.