Hello Everyone, Please let me have the clarity on following: Annual Leave Encashment is done on Basic salary or Gross salary during the Full and Final settlement. Thank you
From India, Pune
From India, Pune
Leave encashment is not a statutory provision. It is regulated as per the Leave Rules in vogue in the Organization/Establishment. Now the question, Leave Encashment is always calculated on last Basic pay drawn + DA. Gross salary is not considered for Leave encashment which may contain fringe benefits like HRA or other allowances which do not form the part of PAY as defined in the FR & SR (Fundamental Rules & Service Rules).
If anyone may wish to have more insight, may contact through E-mail at arunjain.ncl@gmail.com
AK Jain
Retired Manager(HR)
Coal India Ltd.
From India, New+Delhi
148If anyone may wish to have more insight, may contact through E-mail at arunjain.ncl@gmail.com
AK Jain
Retired Manager(HR)
Coal India Ltd.
From India, New+Delhi
Generally leave encashment done on the basic salary. But organisation can formulate the rules governing encashment. leave encashment is not mandated by Indian labour laws. The employer decides whether the unused paid leave can be encashed or carried forward to the next year. Organisations generally provide this facility to address their authorised or unauthorised absentism.
Hope this piece of information helps.
From India, Mumbai
Hope this piece of information helps.
From India, Mumbai
Refer to the Chapter VIII, clause 78 & 79(3), the Factories Act, 1948 on leave encashment. There is no mention that the encashment to be done on basic salary. It should be done on gross salary as it would have been the case when an employee takes a leave and get paid in full equivalent to their worked day.
There is no logic paying it on basic. However, it's commonly practised which is incorrect
Even a new joined employee is entitled for leave encashment upon termination/resignation/death (to their heir) notwithstanding the condition of 240 days working or before confirmation.
From India, Pune
There is no logic paying it on basic. However, it's commonly practised which is incorrect
Even a new joined employee is entitled for leave encashment upon termination/resignation/death (to their heir) notwithstanding the condition of 240 days working or before confirmation.
From India, Pune
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