Dear All,
Can anybody tell me about:
- Leave Encashment
- Carry forward (Is there any limit on how much can be carried forward?)
Should either carry forward or leave encashment be applicable in the organization? If yes, I would need the proper reasons as per the law. I am in the IT industry. Can anybody tell me about a good leave policy?
Regards,
Monika
From India, Gurgaon
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1Can anybody tell me about:
- Leave Encashment
- Carry forward (Is there any limit on how much can be carried forward?)
Should either carry forward or leave encashment be applicable in the organization? If yes, I would need the proper reasons as per the law. I am in the IT industry. Can anybody tell me about a good leave policy?
Regards,
Monika
From India, Gurgaon
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Dear Monica,
I can share what I have implemented in my company, which is a mid-sized organization.
Privilege leave entitlement is 15 working days.
The calendar year is the basis for Privilege leave.
Holidays and weekends falling in between the leave period are excluded while computing the total number of days taken as leave.
The leave will be credited in advance on 1st January of every year.
In the case of those who are joining in the middle of the year, the same will be calculated on a prorata basis.
The maximum leave you can carry forward from the previous year is 15 days.
Employees can carry forward any leave balances they have in one year to the next year. However, the total leave being carried forward cannot exceed 15 days. Thus, the employee cannot have more than 30 days of leave accumulated against their name at any given time (15 days for that year and 15 days of leave carried forward).
The minimum unit for the utilization of privilege leave is half a day.
Privilege leave in excess of 2 days must be planned at least 7 days in advance.
Privilege leave will not normally be granted during the notice period when an employee resigns from the service of the company.
Privilege leave taken beyond the entitlement will be considered as loss of pay (LOP).
Encashment:
The leave balance from the previous years can be encashed in the month of January.
In the case of the total number of leave days exceeding 30 days for any employee, all leave over and above 30 days will be encashed by default.
Basic salary will be the basis of Encashment.
Privilege leave cannot be clubbed with any other form of leave.
You can formulate your company's leave policy accordingly.
Cheers,
Alexy Kuriakose
alexy@ideas.in
9886789305
From India
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I can share what I have implemented in my company, which is a mid-sized organization.
Privilege leave entitlement is 15 working days.
The calendar year is the basis for Privilege leave.
Holidays and weekends falling in between the leave period are excluded while computing the total number of days taken as leave.
The leave will be credited in advance on 1st January of every year.
In the case of those who are joining in the middle of the year, the same will be calculated on a prorata basis.
The maximum leave you can carry forward from the previous year is 15 days.
Employees can carry forward any leave balances they have in one year to the next year. However, the total leave being carried forward cannot exceed 15 days. Thus, the employee cannot have more than 30 days of leave accumulated against their name at any given time (15 days for that year and 15 days of leave carried forward).
The minimum unit for the utilization of privilege leave is half a day.
Privilege leave in excess of 2 days must be planned at least 7 days in advance.
Privilege leave will not normally be granted during the notice period when an employee resigns from the service of the company.
Privilege leave taken beyond the entitlement will be considered as loss of pay (LOP).
Encashment:
The leave balance from the previous years can be encashed in the month of January.
In the case of the total number of leave days exceeding 30 days for any employee, all leave over and above 30 days will be encashed by default.
Basic salary will be the basis of Encashment.
Privilege leave cannot be clubbed with any other form of leave.
You can formulate your company's leave policy accordingly.
Cheers,
Alexy Kuriakose
alexy@ideas.in
9886789305
From India
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Thnx a lot ! Alexy.... Its really helpful for me. Tell me one thing that r we bound for following Delhi shops and Establishment Act? MG
From India, Gurgaon
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From India, Gurgaon
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It depends upon under which act your company is registered. (Factories Act or Shop and Establishment Act)
· For Leave Encashment you can follow your company management policy. In our company we encash the EL/PL keeping 15 days EL/ PL as balance. Some company's encash EL/PL ones the employee leave the company
· For Carry Forward of EL/PL:
o If you comes under the preview of Shop and Establishment Act
No. of Leave (el/pl) Permissible = 15 days
Minimum Accumulation Limit is 3 years i.e. up to 3 times the period of leave to which the employee is entitled after one year i.e. 45 days)
o If you comes under the preview of Factories Act
No. of Leave (el/pl) Permissible = 20 days
Minimum Accumulation Limit = 30 days
From United States, Rochester
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· For Leave Encashment you can follow your company management policy. In our company we encash the EL/PL keeping 15 days EL/ PL as balance. Some company's encash EL/PL ones the employee leave the company
· For Carry Forward of EL/PL:
o If you comes under the preview of Shop and Establishment Act
No. of Leave (el/pl) Permissible = 15 days
Minimum Accumulation Limit is 3 years i.e. up to 3 times the period of leave to which the employee is entitled after one year i.e. 45 days)
o If you comes under the preview of Factories Act
No. of Leave (el/pl) Permissible = 20 days
Minimum Accumulation Limit = 30 days
From United States, Rochester
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Hi Monica,
Every organization can have leave policies depending on the type of business the organization is engaged in.
However, according to labor law, every employee in the organization is entitled to the following:
- Casual Leaves: 4
- Sick Leaves: 5
- Privilege Leaves: 21
Casual Leaves cannot be carried forward or encashed. They lapse if the employees don't use them by the end of the year.
Sick Leaves can be carried forward until they total up to 30 but cannot be encashed. So, if you are sick for 10 days, you will still be paid the salary for those 10 days. However, if you resign, your sick leaves will lapse.
Privilege Leaves are earned leaves. Every employee accumulates 1.75 leaves per month only after working for the whole month. Therefore, if anyone works for 12 months, they will have 12 - 1.75 = 21 leaves. Since these leaves are earned, they are encashable and can be carried forward. An employee can carry forward Privilege Leaves only until they total up to 42, after which they are encashed at the basic rate.
All leaves are credited to the employee's account from the date of joining, but an employee is eligible to use Casual and Sick Leaves only after completing six months or on confirmation, whichever comes earlier.
Leaves are credited proportionately to the employee's account when employees join in between the year.
Hope this information helps you to some extent.
Goodbye and wish you all the best.
Vrush
From India, Pune
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Every organization can have leave policies depending on the type of business the organization is engaged in.
However, according to labor law, every employee in the organization is entitled to the following:
- Casual Leaves: 4
- Sick Leaves: 5
- Privilege Leaves: 21
Casual Leaves cannot be carried forward or encashed. They lapse if the employees don't use them by the end of the year.
Sick Leaves can be carried forward until they total up to 30 but cannot be encashed. So, if you are sick for 10 days, you will still be paid the salary for those 10 days. However, if you resign, your sick leaves will lapse.
Privilege Leaves are earned leaves. Every employee accumulates 1.75 leaves per month only after working for the whole month. Therefore, if anyone works for 12 months, they will have 12 - 1.75 = 21 leaves. Since these leaves are earned, they are encashable and can be carried forward. An employee can carry forward Privilege Leaves only until they total up to 42, after which they are encashed at the basic rate.
All leaves are credited to the employee's account from the date of joining, but an employee is eligible to use Casual and Sick Leaves only after completing six months or on confirmation, whichever comes earlier.
Leaves are credited proportionately to the employee's account when employees join in between the year.
Hope this information helps you to some extent.
Goodbye and wish you all the best.
Vrush
From India, Pune
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Employee reference policy.doc