If Leaves are encashed Annually or at the time of separation?

Hi Seniors,
Would want to know if Leaves are encashed Annually or at the time of separation.
Regards
Kavita Rao

Dear Kavia,
Earned Leave can be encashed annually as well as at the time of separation it depends on the company policy. Many company gives both options, but in case of annual encashment employee is not allow to encash complete leave balance. He has to keep certain numbers of leaves in his leave balance for the current year. Where as in case of separation he / she can encash complete leave balance.

Dear Kavita,
Annual Leave as regulated by Factory Act states the below mentioned.
Calculation for adult: one day for every twenty days of work performed by him during the previous calendar year.
Carry Forward: 30 days in case of adult.
Leave Encashment:
1.Fraction of leave of half a day or more should be considered as full and less than half day should not be considered.
2.Whole of the leave balance to be paid during normal separation/termination.
PS: Factory act does not define whether to be paid on Basic or Gross salary. Also, please refer Factory Act for better clarification.
Regards,
Niraj Sharma

Yes, you can pay it only on basic. But the only thing you need to consider is, Basic should be more than minimum wages Basic + DA and the same has to be fallen under your leave policy.

OK Thank you. Ours is a software company working five days. What should be the minimum EL because act says 1 EL for 20 days.

Dear Kavita,
If your company falls under shops and establishment then you need to check applicability in your state's shops act.