Leave Policies for Small Private Companies in India: How Do You Divide CL, SL, and EL?

For small private companies in India, what are the leave policies? How to divide CL, SL, and EL? Thank you.

You are looking for leave policies or politics? If your organization is covered under the Shops & Commercial Establishment Act, refer to the act and plan accordingly. In Telangana, EL is 1 leave for every 20 days worked, and CL & SL are 12 per annum. Refer to the act for more details and plan accordingly, such as leaves, carry forwarding, approval process, encashment upon separation of service, and annual encashment as well.

Hi, leave policies for private organizations depend on the nature of the industry and the state where the organization is located.

Dear Hima-Reddy,

In India, leave policies for small private companies typically follow the guidelines set by state-specific Shops and Establishments Acts, which can vary depending on the location. Here's a general overview of the types of leaves and how they are divided:

Casual Leave (CL):

Purpose: Casual leave is meant for short-term personal needs or unforeseen circumstances.
Typical Entitlement: 7-10 days per year.
Accrual: CL is usually credited at the beginning of the year and doesn't carry over to the next year. If not used, it lapses.

Sick Leave (SL):

Purpose: Sick leave is provided for health-related issues or medical emergencies.
Typical Entitlement: 5-12 days per year.
Accrual: SL is usually credited annually and may carry over to the next year, depending on the company's policy. Some companies may allow a maximum accumulation limit.

Earned Leave (EL) / Privilege Leave (PL):

Purpose: Earned leave is intended for longer vacations or planned personal time off.
Typical Entitlement: 15-30 days per year.
Accrual: EL is accumulated based on the number of days worked, usually 1 day for every 20-30 days of work. Employees can carry over unused EL to the next year, with many companies allowing accumulation up to a specific limit.

Key Considerations for Small Private Companies:

Policy Flexibility: Small companies often have the flexibility to design leave policies that best suit their needs, as long as they comply with state laws.
Consulting Legal Requirements: It's essential to consult the specific Shops and Establishments Act of the state where the company operates to ensure compliance.
Leave Encashment: Some companies allow employees to encash unused Earned Leave, either annually or at the time of resignation/retirement.

Sample Leave Policy Division:

For a small private company in a state with typical provisions:
- CL: 7 days per year.
- SL: 10 days per year.
- EL: 20 days per year, with carryover up to 45 days.

This structure balances the need for short-term and long-term leaves while ensuring that employees have sufficient time off for rest and personal matters.

Thanks

Leave Eligibility Policy

The CL/EL-PL/SL/LOP eligibility policy should be as stipulated in the applicable act/rules. It's not commensurate with whether a company is small or large. It shall be as per the relevant statute, whether registered as a factory, shops & commercial establishments, or a society, trust, etc. Follow the rules.

Leave Policy in Maharashtra

Required: In Maharashtra, the leave policy is governed by the Maharashtra Shops and Establishments Act.