Dear Members, Need guidance: As per the Shops and Establishment Act of Karnataka in January 2023: - Leave Entitlement - Leave Accrual process - Leave Encashment provision - If an employee is in a probation period, will it affect his leave entitlement (as per S&D guidelines). Thank you.
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Leave Entitlement Under the Karnataka Shops and Commercial Establishments Act
Leaves applicable to shops and commercial establishments are governed by Section 15 of the Karnataka Shops and Commercial Establishments Act. Accordingly, every employee is entitled to get one day of leave (with salary) for every 20 days worked. This is normally credited on the 1st of January based on the attendance of the preceding year.
Sick Leave Policy
In addition to the above, every employee (including new joiners) should be given a total of 12 days of leave per year as sick leave. For existing employees, this will also be credited on the 1st of January. For new employees (those who join in the current year), you can credit it proportionately. For example, 11 days for someone who joins in February, 10 days for someone who joins in March, and so on. The HR practice is to treat a fraction of a month of more than 15 days, i.e., joining between the 1st and 15th of the month, as a full month and to ignore it if the joining date is after the 15th of the month.
Leave Entitlement for Employees on Probation
The law has not made any separate treatment for employees on probation, and therefore, an employee on probation should also be entitled to the above leaves.
Leave Carry Forward and Encashment
The balance of leave or leave unavailed during a year shall be carried forward to the next year, subject to a maximum of 30 days. However, any leave refused by the employer due to business exigencies shall be allowed to be carried forward even if the total of such carry forward exceeds 30 days.
Regarding the encashment of leaves, the law stipulates that unavailed leave shall be encashed at the time of termination of employment. However, leave policies may provide for such encashment during service as well.
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Leaves applicable to shops and commercial establishments are governed by Section 15 of the Karnataka Shops and Commercial Establishments Act. Accordingly, every employee is entitled to get one day of leave (with salary) for every 20 days worked. This is normally credited on the 1st of January based on the attendance of the preceding year.
Sick Leave Policy
In addition to the above, every employee (including new joiners) should be given a total of 12 days of leave per year as sick leave. For existing employees, this will also be credited on the 1st of January. For new employees (those who join in the current year), you can credit it proportionately. For example, 11 days for someone who joins in February, 10 days for someone who joins in March, and so on. The HR practice is to treat a fraction of a month of more than 15 days, i.e., joining between the 1st and 15th of the month, as a full month and to ignore it if the joining date is after the 15th of the month.
Leave Entitlement for Employees on Probation
The law has not made any separate treatment for employees on probation, and therefore, an employee on probation should also be entitled to the above leaves.
Leave Carry Forward and Encashment
The balance of leave or leave unavailed during a year shall be carried forward to the next year, subject to a maximum of 30 days. However, any leave refused by the employer due to business exigencies shall be allowed to be carried forward even if the total of such carry forward exceeds 30 days.
Regarding the encashment of leaves, the law stipulates that unavailed leave shall be encashed at the time of termination of employment. However, leave policies may provide for such encashment during service as well.
From India, Kannur
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Thank you Madhu TK.. These are good insights .. Also wanted to check if you have the extract of S&D Acti which mentions these. Warm Regards, Pooja Singh
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(Fact Checked)-The Extract of the Shops and Establishments Act should contain details on leave entitlement. It's essential for compliance. (1 Acknowledge point)
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What is the S&D Act? I don't know. However, the leave and other service conditions of employees in shops and other commercial establishments are mentioned in the respective state's Shops and Commercial Establishments Act. You can refer to the one for Karnataka State. Please find the attachment.
From India, Kannur
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In case of orgnisations following Work from home - Abstract of the Act and Rules - displayed? - how can this be made compliant ..Plz guide
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All these leave rules discussed above here, is applicable on as-is basis for Independent Contractor or Consultants ?
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No, no leave rules are applicable to independent contractors and consultants engaged by an establishment. Some companies employ 'consultants' just to avoid the application of labor laws. One of the tests to prove that they are employees is the application of leave rules to them.
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Karnataka Shops& Commercial Establishment ACT.pdf
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(Fact Checked)-The user reply contains accurate information regarding leave entitlement, accrual, encashment, and probation period under the Karnataka Shops and Commercial Establishments Act. (1 Acknowledge point)