Can My Company Refuse Leave Encashment? Understanding Rajasthan State Shop Act Rules

I resigned from the company and was relieved after one month by HR. I have received the full and final calculation wherein the company has not provided me the PL encashment (30 days balance). I asked HR about the same, and they are saying that we don't have a leave encashment policy. In the appointment letter, they have not mentioned anything about whether they will give or not give it.

Leave Encashment Policy and Legal Obligations

Now I want to know if leave encashment is compulsory as per the Rajasthan State Shop Act rules or if the company has the right not to pay (I work with an NBFC in a city in Rajasthan having Headquarters in Mumbai).

Please shed some light on the rule. Can I challenge my company on this matter or not?

Hi,

It doesn't mean that you are not eligible for the encashment since it's not mentioned in the appointment order. Apart from the appointment order, you will have different policies governing employees at your company. I suggest you go through the leave policy of your organization.

Regards, Nagaraj N. K Bangalore 9449783810

Leave Encashment Under the Rajasthan Shops and Commercial Establishments Act, 1958

As per clause 11 of explanation 2 to Section 14 of the Rajasthan Shops and Commercial Establishments Act, 1958, in the case of a unilateral exit of employment by the employee, the employee shall be paid the wages for the leave with wages in their credit before the expiry of the next payday. The amount payable shall be calculated in this regard as provided for under Section 15 of the Act.

In case of failure or refusal by the employer, the employee can file a claim under Section 15 of the Payment of Wages Act, 1936, as the mode of recovery suggested in Section 17 of the RS&CE Act, 1958.

No leave policy of an organization can run counter to the leave provisions of an Act applicable to such organization. Bring it to the notice of the company before initiating legal action.

Dear Sir,

Thank you for the insight on the Rajasthan Shop and Establishment Act. I have emailed the company's HR, but so far, I have not received any response from them. Yesterday evening, they replied that they would revert soon but did not mention whether they would pay or not. They also did not provide any timeline for their response.

Could you please advise how long I should wait for their reply? I am starting to believe that they are not planning to pay me. Should I consider sending a legal notice?

Thank you.