Earned Leave Policy Redrafting
Our company, which falls under the Factories Act, is redrafting its Earned Leave policy. The company has decided to maintain the annual entitlement at 20 days, with a maximum carry forward of 30 days. Assuming an employee does not avail of any leave balance, the accumulation pattern would work out as follows:
1/1/2018: Date of joining
1/1/2019: 20 days credit (for the previous year worked)
1/1/2020: 20 days credit (for the previous year worked, total balance now 40 days)
31/12/2020: 40 days accumulated balance.
1/1/2021: 30 days revised balance (excess 10 days get lapsed or encashed)
Compliance Inquiry
My question is, is there any law, section, or sub-section that mandates the company to compulsorily encash the excess 10 days (on 1/1/2021)? Alternatively, from a compliance perspective, would it cause any issues if the excess 10 days were to be lapsed?
Thanks in advance for your time and inputs.
Take care & be safe.
From India
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Our company, which falls under the Factories Act, is redrafting its Earned Leave policy. The company has decided to maintain the annual entitlement at 20 days, with a maximum carry forward of 30 days. Assuming an employee does not avail of any leave balance, the accumulation pattern would work out as follows:
1/1/2018: Date of joining
1/1/2019: 20 days credit (for the previous year worked)
1/1/2020: 20 days credit (for the previous year worked, total balance now 40 days)
31/12/2020: 40 days accumulated balance.
1/1/2021: 30 days revised balance (excess 10 days get lapsed or encashed)
Compliance Inquiry
My question is, is there any law, section, or sub-section that mandates the company to compulsorily encash the excess 10 days (on 1/1/2021)? Alternatively, from a compliance perspective, would it cause any issues if the excess 10 days were to be lapsed?
Thanks in advance for your time and inputs.
Take care & be safe.
From India
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There is no specific provision of law that states the leave in excess of the ceiling limit would lapse on the new entitlement. However, it is implied when it is stated that the maximum accrual limit of annual leave is fixed. The above illustration is correct.
From India, Mumbai
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1593From India, Mumbai
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FACTORIES ACT-leave rules.doc
Factories Act-Sec.79-Leav e.pdf