As per Factory Act A worker is eligible for Earned Leaves after completion of 240 working days; And he will be paid 12 EL against 240 working days. But there is some confusion; some says working days mean paid days which include Sunday and holidays but actually working days mean without Sunday and Holidays. Some Professional Says we have to pay 18 leaves in a year (365/15 = 18), but as per working days it will be max 300 to 302 working days in a year then we have to pay only 15 EL. So please clarify.
From United States, Cambridge
From United States, Cambridge
Let us see what the Factories Act says.
There are two important clauses. One relating to eligibility and the other one relating to calculation of number of leaves to which the employee is entitled to.
Eligibility: An employee is eligible for leave (Earned leave or annual leave with wages as it is called in the Act) only if he has worked for 240 days. One who has joined during the year will be eligible to get earned leave in the current year if he has worked for 120 days in the six months period or simply 20 days in a month.
For deciding the eligibility all PAID DAYS should be taken in to account, That is this 240 days is inclusive of all weekly off days, holidays and leave days for which the employee was paid wages/ salary. The days one employee remained absent or leave under ESI, due to employment injury or accidents or occupational diseases should also be considered as days worked for the purpose of eligibility. Similarly, the days an employee was given lay off shall also be counted as working days.
For example, suppose a person had physically worked for 150 days in the preceding calendar year (2022) He had taken 10 days earned leave during 2022. He had met with an accident while on duty and he was on leave for another 8 days. On account of shortage of materials he was given lay off for 10 days in 2022. He was paid weekly off wages for 52 days and had enjoyed 10 days holidays in 2022.
Now, he will be eligible for earned leave in 2023 because he satisfies the eligibility condition. That is though he had come to factory only for 150 days, he was paid for 222 days (52 weekly off, 10 holidays, 10 days' earned leaves which he should have earned from the last year). He was paid by the ESIC for 8 days (or by the company itself for the leave admissible under the Employees Compensation Act, if not covered by ESI) and he was paid half the salary for 10 days as lay off compensation. The total is 240 days.
Now coming to the entitlement for leave, we will take only the days he has PHYSICALLY PRESENT for work in the factory and that is 150 and he will ultimately earn only 7.5 or 8 days' leave at the rate of one day for every 20 days worked.
That is for eligibility of 240 days we will consider all paid days plus days of lay off and days for which ESI had paid salary but for number of days of leave we take only days physically present.
From India, Kannur
4238There are two important clauses. One relating to eligibility and the other one relating to calculation of number of leaves to which the employee is entitled to.
Eligibility: An employee is eligible for leave (Earned leave or annual leave with wages as it is called in the Act) only if he has worked for 240 days. One who has joined during the year will be eligible to get earned leave in the current year if he has worked for 120 days in the six months period or simply 20 days in a month.
For deciding the eligibility all PAID DAYS should be taken in to account, That is this 240 days is inclusive of all weekly off days, holidays and leave days for which the employee was paid wages/ salary. The days one employee remained absent or leave under ESI, due to employment injury or accidents or occupational diseases should also be considered as days worked for the purpose of eligibility. Similarly, the days an employee was given lay off shall also be counted as working days.
For example, suppose a person had physically worked for 150 days in the preceding calendar year (2022) He had taken 10 days earned leave during 2022. He had met with an accident while on duty and he was on leave for another 8 days. On account of shortage of materials he was given lay off for 10 days in 2022. He was paid weekly off wages for 52 days and had enjoyed 10 days holidays in 2022.
Now, he will be eligible for earned leave in 2023 because he satisfies the eligibility condition. That is though he had come to factory only for 150 days, he was paid for 222 days (52 weekly off, 10 holidays, 10 days' earned leaves which he should have earned from the last year). He was paid by the ESIC for 8 days (or by the company itself for the leave admissible under the Employees Compensation Act, if not covered by ESI) and he was paid half the salary for 10 days as lay off compensation. The total is 240 days.
Now coming to the entitlement for leave, we will take only the days he has PHYSICALLY PRESENT for work in the factory and that is 150 and he will ultimately earn only 7.5 or 8 days' leave at the rate of one day for every 20 days worked.
That is for eligibility of 240 days we will consider all paid days plus days of lay off and days for which ESI had paid salary but for number of days of leave we take only days physically present.
From India, Kannur
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Karnataka Leave.xlsx
LEAVE APPLICATION.doc