Understanding Minimum Leave Regulations for Software Companies and Compliance with Statutory Require

Hi All,

Our software company currently has the following leave structure:

- SL-12
- CL-12
- PL-12

We are looking to consolidate these 36 leaves into 18 paid leaves without any differentiation between SL, PL, and CL. Are there any statutory implications to consider with this change? If you are from a software company, could you please share the leave structure in your organization?

Please assist me.

Aravind

Dear Aravind,

I am also working in an IT company.

1. CL leave - 12 days monthly, one day with pay. More than one day of leave results in LOP.
2. SL / ML (Medical Leave) - 6 days per year - If a medical certificate is provided, this leave is eligible with pay.

So, there are 18 days of leave available per year (12 CL + 6 ML).

Regards,
Shanshen

Hi Arvind,

We have the following leave structure:
1. 4 mandatory holidays and 5 optional holidays out of the 7 listed.
2. 10 days of paid leave, comprising both CL and SL.
3. No carry forward, no encashment.

Regards,
Smitaa

Thank you Shanshen and Smitaa for your response. This is very useful information for me. I need similar information from a few more companies so that I can convince my people. Please help.

Aravind

Hi Aravind,

What is the flat minimum number which any IT company is supposed to pay to its employees as per statutory demand? Please help me in this regard since I am in the process of framing our Leave Policy.

Thanks,
Shalini

May I know whether the software companies follow the provisions of the Shops and Commercial Establishment Act of the respective state governments.

Thanks,
L. N. Murty

Please do not rob your hardworking employees of their PAID LEAVES in any category. It will only provoke them to take more leaves based on "INVENTED" reasons, such as medical problems, etc.

CIAO

Hi, L N Murty,

I apologize if my words may have caused any offense unintentionally. Let's revisit the original query. Currently, the employees are already enjoying some time off, and the company aims to reduce this benefit by half. How can one retract a benefit once it has been granted?

Furthermore, the company is following a leave policy that does not comply with any regulations. Could you please clarify which law in India dictates the lapse of leave days at the end of the leave year? According to The Factories Act, leave can be accrued for up to 30 days, and under the Shops and Commercial Establishment Act (specifically in Andhra Pradesh), leave can be accrued for up to 60 days. Additionally, it is permissible to encash leave for up to 7 days as per the S&E Act (reference - AP).

My concern lies in whether we, as HR professionals, are inadvertently depriving employees of their legal rights as outlined in relevant statutes. If these laws do not apply to software companies, please enlighten me on the specific regulations that exempt them.

I want to emphasize that my inquiries stem from academic curiosity, and I have no intention of causing any disruption within any sector of companies.

Thank you.

Best regards,
L N Murty

I was joking, man. If I want to take a leave, I will. No HR can show any policy document and stop me, unless of course, it's unnecessary. Hehe. Bye.

Kabhi kabhi jokes bahut mehnga padta hai. If you put anything in black or white, you should be a little careful. I don't want to joke further on this matter. Let us close this now.

Thanks,
L N Murty

Hi Guys,

I think we are deviating from the topic. Do we have any laws or procedures that specify the minimum number of leaves for software industries?

In my company, we follow a leave structure as follows:
- CL: 12
- SL: 12
- PL: 36
- List of Holidays: 15

Thanks,
Suresh

Dear Aravind,

As per statutory records, the minimum leave entitlement is as follows:
- 6 days SL
- 6 days CL
- 15 days PL

All software companies are covered under the Shop and Establishment Act. The above structure represents the minimum leave entitlement. You can provide a greater number of leave days, but you must adhere to the minimum levels as per government policy.

Dear Murugan,

Can you please indicate the section in which the minimum leave is prescribed in the S&E Act?

Regards,
Suresh

Hi,

I am working in a software company. We have 20 yearly leaves, which includes everything such as PL, CL, and SL.

Hi,

The leave rules are clearly outlined as per The Shops & Establishment Acts for different states.

The Delhi Shops & Establishments Act, 1954 states the Leave Rules in Section 22 as follows:-

a) After every twelve months of continuous service, PL for a total period of not less than 15 days.
b) In every year, sickness & casual leave for a total period of not less than 12 days.

However, an employee who has completed a period of 4 months in continuous employment shall be entitled to not less than five days PL for every such completed period.

And as per THE BOMBAY SHOPS & ESTABLISHMENTS ACT, 1948, it is as follows:-

The main provisions of the Act about the grant of annual leave with wages are as follows:
1. An employee is entitled to annual leave with pay for 21 days for 240 days of work.
2. An employee who has not worked for one year is entitled to leave with pay for 5 days for every 60 days of work.
3. An employee is entitled to be paid half the amount of his leave pay before his leave begins.
4. Leave with pay can be accumulated up to 42 days.
5. A discharged employee is entitled to leave pay for the balance of leave to his credit. {Subsections 35 to 37}

Please let me know if this info was helpful.

Thanks,
Nidhi

Dear Arvind,

Ours is also a software development company, and we are considering revising our leave policy to align it with larger companies. However, can anyone provide information on the following:

- Number of leaves allowed in a year
- List of holidays - i.e., how many days can be declared holidays
- Working days - Are all Saturdays off?
- Office timings for the above scenario

I would be grateful for any information you can provide on the above.

Thank you.

Hi Suresh,

Can you please come up with the name of the software company, as the leave benefits you enjoy are truly fantastic compared to many companies that offer only half of what you have.

Hi Ramesh,

That is the problem; we are following a leave policy which is very old and will be revamped shortly. The major problem we face is that an employee will be unbillable for 2 months as per the current leave structure. Can you specify the section where the minimum leave is mentioned in the Tamilnadu S & E Act?

Regards,
Suresh

Dear Suresh,

Tamil Nadu Shops and Establishments Act, Section 25 of Chapter VI, clearly states that an employee is entitled to 12 days each of Casual Leave, Sick Leave, and Privilege Leave. However, many IT companies provide a maximum of 20 days per year. I am seeking information from fellow members regarding any exemptions granted by the local government for IT companies to maintain a minimum of 20 days of leave.

Thanks,
Ramesh