Hi ! Experts,
I have worked in a company of Chennai (Tamil Nadu) & after 11 years & 6 months i have resigned with 1 month notice as per the clause of my appointment letter.
Now apart from my pending salary,Medical, LTA, Gratuity they are not ready to pay my Leave Encashment amount.
I have been informed by the HR people that their is no legal boundation on employer. This is the sole discreation of the employer to pay it or not.
Also they are saying that because companies financial condition is not so good, So they are not able to pay LEAVE ENCASHMENT AMOUNT.
So please suggest me is it correct or wrong ?
Can I take any legal action if there is any rule in labour laws.
Please help me.
Regards.
Aman Kumar Dubey.
From India, Mumbai
I have worked in a company of Chennai (Tamil Nadu) & after 11 years & 6 months i have resigned with 1 month notice as per the clause of my appointment letter.
Now apart from my pending salary,Medical, LTA, Gratuity they are not ready to pay my Leave Encashment amount.
I have been informed by the HR people that their is no legal boundation on employer. This is the sole discreation of the employer to pay it or not.
Also they are saying that because companies financial condition is not so good, So they are not able to pay LEAVE ENCASHMENT AMOUNT.
So please suggest me is it correct or wrong ?
Can I take any legal action if there is any rule in labour laws.
Please help me.
Regards.
Aman Kumar Dubey.
From India, Mumbai
173
Dear Aman
Not all types of leaves are encashable. Only earned leaves have certain legal obligations for encashment as they are earned against the days served as per provisions of Factories Act. However the company can lay the upper ceiling for accumulation as well as for encashment (no. of such leaves) as the true objective of such leaves is to avail it and not to encash it.
However you do not have strong legal back up to fight your case, except you have established leave rules/standing orders providing for encashment.
Regards
Shailesh Parikh
Vadodara, Gujarat
From India, Mumbai
Not all types of leaves are encashable. Only earned leaves have certain legal obligations for encashment as they are earned against the days served as per provisions of Factories Act. However the company can lay the upper ceiling for accumulation as well as for encashment (no. of such leaves) as the true objective of such leaves is to avail it and not to encash it.
However you do not have strong legal back up to fight your case, except you have established leave rules/standing orders providing for encashment.
Regards
Shailesh Parikh
Vadodara, Gujarat
From India, Mumbai
Dear Aman Kumar Dubey,
Please read below relevant section 79 from Factories Act with reference to your query.
Factories Act, 1948 - Section 79 - Annual Leave with Wages
(3) If a worker is discharged or dismissed from service or quits his employment or is superannuated or dies while in service, during the course of the calendar year, he or his heir or nominee, as the case may be, shall be entitled to wages in lieu of the quantum of leave to which he was entitled immediately before his discharge, dismissal, quitting of employment, superannuation or death, calculated at the rates specified in sub-section (1), even if he had not worked for the entire period specified in sub-section(1) or sub-section (2) making him eligible to avail of such leave, and such payment shall be made -
• (i) where the worker is discharged or dismissed or quits employments before the expiry of the second working day from the date of such discharge, dismissal or quitting; and
• (ii) where the worker is superannuated or dies while in service, before the expiry of two months from the date of such superannuation or death.
Hence, the employer is bound to pay amount against the quantum of unused Earned Leave when relieving you.
Regards,
Madhusudan
From India, Vijayawada
Please read below relevant section 79 from Factories Act with reference to your query.
Factories Act, 1948 - Section 79 - Annual Leave with Wages
(3) If a worker is discharged or dismissed from service or quits his employment or is superannuated or dies while in service, during the course of the calendar year, he or his heir or nominee, as the case may be, shall be entitled to wages in lieu of the quantum of leave to which he was entitled immediately before his discharge, dismissal, quitting of employment, superannuation or death, calculated at the rates specified in sub-section (1), even if he had not worked for the entire period specified in sub-section(1) or sub-section (2) making him eligible to avail of such leave, and such payment shall be made -
• (i) where the worker is discharged or dismissed or quits employments before the expiry of the second working day from the date of such discharge, dismissal or quitting; and
• (ii) where the worker is superannuated or dies while in service, before the expiry of two months from the date of such superannuation or death.
Hence, the employer is bound to pay amount against the quantum of unused Earned Leave when relieving you.
Regards,
Madhusudan
From India, Vijayawada
Dear Mr. Dubey
it is manadatory as per the factory act and other labour laws that employer is bound to pay your salary up to the extend you have Previlage/ earn leave in your credit on the date of your exit form company. Most of compnay or following the same but few of compnay not caring at all. In such a situation aggrived employee has valid claim to recover his leave salary through civil suit, but need to take opinion from an Advoceate.
rl pandey
From India, Hyderabad
it is manadatory as per the factory act and other labour laws that employer is bound to pay your salary up to the extend you have Previlage/ earn leave in your credit on the date of your exit form company. Most of compnay or following the same but few of compnay not caring at all. In such a situation aggrived employee has valid claim to recover his leave salary through civil suit, but need to take opinion from an Advoceate.
rl pandey
From India, Hyderabad
Aman, you for your organization does the factory act apply? Does your appointment letter state anything about leave encashment/adjustment with notice period etc.... What does your employee handbook say.
If you are still in service... you may want to take a quick look at these and come back with more info.
From India, Mumbai
If you are still in service... you may want to take a quick look at these and come back with more info.
From India, Mumbai
Mr Aman
If your service was not in a Factory setup you are not entitled for EL encashment under Factories Act.If it was in a Commercial establishment your entitlement will depend on the provisions of Tamllnadu Shops & Commercial Establishment Act.If that is also not applicable everything depends on terms of appointment or conditions of service .
Varghese Mathew
9961266966
From India, Thiruvananthapuram
If your service was not in a Factory setup you are not entitled for EL encashment under Factories Act.If it was in a Commercial establishment your entitlement will depend on the provisions of Tamllnadu Shops & Commercial Establishment Act.If that is also not applicable everything depends on terms of appointment or conditions of service .
Varghese Mathew
9961266966
From India, Thiruvananthapuram
Dear Aman,
As per Tamil Nadu Shops and Establishment Act they are legally bound to pay you the leave encashment. See section 25 sub section 3 for reference. However the maximum accumulation of leaves is 24 days given under the said Act hense the encashment of leaves for 24 days is the maximum encashment you may get legally.
From India, New Delhi
As per Tamil Nadu Shops and Establishment Act they are legally bound to pay you the leave encashment. See section 25 sub section 3 for reference. However the maximum accumulation of leaves is 24 days given under the said Act hense the encashment of leaves for 24 days is the maximum encashment you may get legally.
From India, New Delhi
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