Is Our EL Encasement Rounding Method Compliant with the Act? Seeking Advice

Dear Sir,

We have a Follow EL Encasement Policy.

Rounded off Method:

If 1.1 to 1.4 means round off to 1.
If 1.5 to 1.59 means round off to 1.5.
If 1.6 to 1.9 means round off to 1.5.

Kindly advise if this method is correct as per the Act.

EL Encashment or Calculation Policy?

Is it your EL encashment policy or EL calculation policy? When you divide the number of days worked by 20 (assuming that EL is one day for every twenty days worked), there will be fractions. It may be like 13.2, 13.6, 13.9, 14.7, etc. A fraction of less than 0.5 will be ignored, and more than 0.5 will be rounded to the next figure. This is the law. Accordingly, if someone has worked for, say, 264 days, he will earn 13 leaves, ignoring the fraction of 0.2, i.e., 264/20 = 13.2. If some person has worked for 296 days, then he will earn 15 days of EL, though it is actually 14.8.

Normally, EL will be availed only in whole day numbers, and as such, there will not be a fraction of a leave in the credit for encashment. Please clarify if your query is related to encashment or EL earning.

There is no specific provision regarding rounding off the fractional leave entitlement. There are two rules that apply:

1. Where there is an entitlement for a minimum number, then for every fraction, it has to be upwardly revised. i.e., for any number greater than 2.0, the number has to be reckoned as 3.

2. Where there is an entitlement for a maximum number, then for every fraction, it has to be limited to the previous whole number. i.e., for any number less than 3, the number has to be reckoned as 2.

3. Also, there is a median approach which is very popularly used, i.e., while a fraction up to 0.5 is ignored, any number equal to or greater than 0.5 is rounded as the next full number. The median approach is fair and equitable. Looking at the legal provision, it is recommended.

Sirs, Thank you for your valuable suggestions. Can I follow the steps below to ensure something is legal in the future?

Rounded off Method:

- If 1.1 to 1.4, round off to 1.
- If 1.5 to 1.59, round off to 1.5.
- If 1.6 to 1.9, round off to 1.5.

Is there any issue in converting >1.5 as 2?

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Is there any issue in converting >1.5 as 2?