Dear Seniors, please guide me. If an employee is on unpaid leave for 4 months to pursue their studies, will it affect statutory or legal compliance? Do we have to make them rejoin again?
From India, Hyderabad
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70From India, Hyderabad
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Leave Without Pay and Its Impact on Service
If the leave without pay for four months or any other duration is approved based on emergencies to the satisfaction of the employer, the gap will not be treated as a break in service. There is no need to make the employee rejoin when they resume service. Since no salary is paid during their leave days, the PF and ESI records will show these periods as non-contributory periods.
Obviously, if the employee leaves after completing the eligible service for payment of gratuity (i.e., five years), the year in which they had taken UNCONDITIONAL APPROVED leave without pay will be treated as countable service. On the other hand, if the leave is approved on the condition that the period of leave will not be counted for the purpose of the calculation of gratuity in the future, then they will not be entitled to have that year included in the service. This is provided that during the remaining days in that year in which they had taken LOP, they had not worked for 240 days, inclusive of paid leaves and holidays.
Regards,
Madhu.T.K
From India, Kannur
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If the leave without pay for four months or any other duration is approved based on emergencies to the satisfaction of the employer, the gap will not be treated as a break in service. There is no need to make the employee rejoin when they resume service. Since no salary is paid during their leave days, the PF and ESI records will show these periods as non-contributory periods.
Obviously, if the employee leaves after completing the eligible service for payment of gratuity (i.e., five years), the year in which they had taken UNCONDITIONAL APPROVED leave without pay will be treated as countable service. On the other hand, if the leave is approved on the condition that the period of leave will not be counted for the purpose of the calculation of gratuity in the future, then they will not be entitled to have that year included in the service. This is provided that during the remaining days in that year in which they had taken LOP, they had not worked for 240 days, inclusive of paid leaves and holidays.
Regards,
Madhu.T.K
From India, Kannur
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Statutory Compliance of a Industrial or Commercial Unit.xls
Statutory-compl iance.pdf
Statutory Compliance.zip