Is It Mandatory to Allow Unused Leave Carry-Over Under the Shop & Establishment Act?

Dear All,

Is it mandatory to allow carry-over of unused leave to the next year under the leave provisions of the Shop & Establishment Act?

Thanks,
Asif

Hi, Asif,

It's never mandatory, but it depends on your company's policy.

Dear Asif,

Yes, under the leave provisions of the Shop & Establishment Act, you can accumulate up to 42 leave days in your account.

Ravi

Hi Ravi,

Thanks for the reply. However, I would like to know, "Is it mandatory to carry forward the leaves," or can we ask employees to avail all the leaves available during the respective calendar year? If not, then leaves will lapse.

Thanks again.

Asif

Hi,

It is mandatory, and every state has a different rule regarding it. For example, in Maharashtra, it is 42; in Delhi, it is 15; in Gujarat, it is 63; in Karnataka, it is 30, etc. The act does not specify whether employees can be asked to take leave or not. However, it does specify that any unutilized leave should be carried forward.

Thank you.

Yes, it is mandatory to carry forward the accumulated leave to the following year, but only up to 42 leaves. The rest will lapse. On the other hand, you cannot compel the employee to avail leave just to avoid encashment of the leaves at the time of separation. Additionally, 42 is the minimum threshold set by the Shops and Establishment Act. However, many companies have designed their policies in a way that employees should fulfill all their moral responsibilities to ensure the smooth operation of workflow.

Regards, Ravi

"Mistakes are proof that you are trying."

Will depend on the state's shops act provisions. But most of the states permit carry forward of leave of 1 or 2 years of entitlement.