Hi, I recently joined a logistics company. I proposed creating a leave policy, but my employee is refusing. They are adamant about not wanting to deal with CL and EL. Their idea is that if an employee takes leave, their salary will be deducted, and if they do not take leave, we will provide them with extra payment for that month.
Is there any written act or law regarding this matter?
Regards,
Nidhi
From India, New Delhi
Acknowledge(0)
Amend(0)
Is there any written act or law regarding this matter?
Regards,
Nidhi
From India, New Delhi
Acknowledge(0)Amend(0)
Dear Shruti Mathur,
If yours is a logistics company, then the provisions of the Shops and Establishment Act of your state (presumably Delhi) apply to your company. The company's administration must abide by the provisions. If the labor authorities notice any violations, it could create problems.
For every 20 days of attendance, an employee is eligible for a day's leave. Out of 365 days of the year, remove 52 Sundays and 10 closed holidays. Therefore, the working days are 303. When you divide this number by 20, you get 15. So each employee is eligible to get at least 15 days leave. If the Shops and Establishment Act of your state has made provisions for casual or sick leave, these also need to be added.
Regardless of the industry, there is a shortage of talent in the job market. To retain employees, companies take measures that go beyond the statutory provisions. If your company does not provide what is statutorily admissible, it could spread a negative image of your company, making it difficult to attract candidates. Additionally, denying statutory benefits could increase employee attrition. The cost of lost opportunities and employee attrition could be greater than the cost of employee leave.
In short, it is advisable to follow the law. Infringing on the law may give temporary benefits, but these will last only until the infringement is detected. In one stroke, the gains made will be nullified.
Thanks,
Dinesh Divekar
From India, Bangalore
Acknowledge(0)Amend(0)
8202If yours is a logistics company, then the provisions of the Shops and Establishment Act of your state (presumably Delhi) apply to your company. The company's administration must abide by the provisions. If the labor authorities notice any violations, it could create problems.
For every 20 days of attendance, an employee is eligible for a day's leave. Out of 365 days of the year, remove 52 Sundays and 10 closed holidays. Therefore, the working days are 303. When you divide this number by 20, you get 15. So each employee is eligible to get at least 15 days leave. If the Shops and Establishment Act of your state has made provisions for casual or sick leave, these also need to be added.
Regardless of the industry, there is a shortage of talent in the job market. To retain employees, companies take measures that go beyond the statutory provisions. If your company does not provide what is statutorily admissible, it could spread a negative image of your company, making it difficult to attract candidates. Additionally, denying statutory benefits could increase employee attrition. The cost of lost opportunities and employee attrition could be greater than the cost of employee leave.
In short, it is advisable to follow the law. Infringing on the law may give temporary benefits, but these will last only until the infringement is detected. In one stroke, the gains made will be nullified.
Thanks,
Dinesh Divekar
From India, Bangalore
Acknowledge(0)Amend(0)
Hi Nidhi,
The following is the requirement under the Delhi Shop and Establishment Act:
Sec 22. LEAVE
(1) Every person employed in an establishment shall be entitled:
(a) after every twelve months, continuous employment, to privilege leave for a total period of not less than fifteen days;
(b) in every year, to sickness or casual leave for a total period of not less than twelve days;
Provided further that a watchman or caretaker who has completed a period of twelve months in continuous employment and to whom the provisions of Section 8, 10, 11, 13, and 17 do not apply by virtue of an exemption granted under Section 4, shall be entitled to not less than thirty days' privilege leave.
(1A) Privilege leave can be accumulated unto three times PL granted under law, custom, or award.
(2) The employer shall pay him full wages for the period of leave due to him on termination or resignation.
23. WAGES DURING LEAVE
Every employee shall be paid for the period of his leave at a rate equivalent to the daily average of his wages for the days on which he actually worked during the preceding three months, exclusive of any earnings in respect of overtime but inclusive of dearness allowance.
(I have paraphrased some of the things to make it easier for non-lawyers to read. You can always look up the exact wording of the section).
So the act not only says the company has to give leave but also how much and what type. It also says how leave salary is computed. So the company has no choice but to follow it. If they do not do so, then they are liable to prosecution, which only requires one employee to go and file a complaint, and they will be at your door.
However, it is not compulsory to make a leave policy. But it is compulsory to allow the leave required by the act. Nothing stops you from giving better leave terms.
Also, refer to sec 24: CONTRACTING OUT
Any contract or agreement, whether made before or after the commencement of the Delhi Shops and Establishments (Amendment) Act, 1970, whereby an employee relinquishes any right conferred by this Act shall be null and void insofar as it purports to deprive him of such right.
From India, Mumbai
Acknowledge(0)Amend(0)
The following is the requirement under the Delhi Shop and Establishment Act:
Sec 22. LEAVE
(1) Every person employed in an establishment shall be entitled:
(a) after every twelve months, continuous employment, to privilege leave for a total period of not less than fifteen days;
(b) in every year, to sickness or casual leave for a total period of not less than twelve days;
Provided further that a watchman or caretaker who has completed a period of twelve months in continuous employment and to whom the provisions of Section 8, 10, 11, 13, and 17 do not apply by virtue of an exemption granted under Section 4, shall be entitled to not less than thirty days' privilege leave.
(1A) Privilege leave can be accumulated unto three times PL granted under law, custom, or award.
(2) The employer shall pay him full wages for the period of leave due to him on termination or resignation.
23. WAGES DURING LEAVE
Every employee shall be paid for the period of his leave at a rate equivalent to the daily average of his wages for the days on which he actually worked during the preceding three months, exclusive of any earnings in respect of overtime but inclusive of dearness allowance.
(I have paraphrased some of the things to make it easier for non-lawyers to read. You can always look up the exact wording of the section).
So the act not only says the company has to give leave but also how much and what type. It also says how leave salary is computed. So the company has no choice but to follow it. If they do not do so, then they are liable to prosecution, which only requires one employee to go and file a complaint, and they will be at your door.
However, it is not compulsory to make a leave policy. But it is compulsory to allow the leave required by the act. Nothing stops you from giving better leave terms.
Also, refer to sec 24: CONTRACTING OUT
Any contract or agreement, whether made before or after the commencement of the Delhi Shops and Establishments (Amendment) Act, 1970, whereby an employee relinquishes any right conferred by this Act shall be null and void insofar as it purports to deprive him of such right.
From India, Mumbai
Acknowledge(0)Amend(0)
When existing laws or acts, rules are adequate to govern the leave aspects in an establishment, there is no compulsion to have a 'leave policy' in place. However, an elaborate 'leave policy' is always desirable to deal with circumstances as and when they arise. If any administration doesn't advocate drafting and implementing an exclusive 'leave policy,' such administration should be prepared to abide by the applicable acts/rules.
From India, Bangalore
Acknowledge(0)Amend(0)
From India, Bangalore
Acknowledge(0)Amend(0)Engage with peers to discuss and resolve work and business challenges collaboratively. Our AI-powered platform, features real-time fact-checking, peer reviews, and an extensive historical knowledge base. - Register and Log In.
Leave Policy.doc