Can IT Companies Require Employees to Use a Set Amount of Annual Leave?

Hi All,

I would like to know if a company can enforce a rule that an employee has to take XX number of annual leave in a year; if not, they will lapse. We are an IT company and fall under the Shops and Establishment Act.

Your inputs on this will help us immensely. I do know of companies that mandate that an employee has to be on a core leave of 10 continuous paid annual leave.

Regards,
Baiju G Nath

As per Section 15(7) of the Karnataka Shops Act, leave unavailed in one year should be allowed to be carried forward to the next year.

Dear colleague,

Like every state Shop Act, the Karnataka Shops Act also provides for the carry forward of unavailed PL to the next year up to a limit of two years' PL entitlement. Therefore, you cannot make a rule for lapsing up to this limit. You may make a rule of lapsing of PL beyond the statutory limit.

Regards,
Vinayak Nagarkar
HR Consultant

Dear Baiju, No instructions from the management can run counter to any beneficial provision of law applicable to the employees covered by it. Annual leave with wages is one such provision in the State Shops and Establishments Acts, of which the Karnataka Act applies to your establishment. When there is a mandatory provision for carrying forward the unavailed portion of a particular type of leave to successive years, subject to a maximum limit, the management cannot insist on availing a particular number of days' leave in a year and declare that failure to do so will result in automatic lapse. As leave cannot normally be claimed by the employee as a matter of right, it cannot be imposed by the management through compulsion.

Thank you.

You can accumulate up to 30 days of Annual Leave under the Karnataka Shops & Commercial Establishments Act. Anything above 30 days has to be availed, lest it will lapse.