Hello, I want to know what are the obligations of an LLP in terms of leave encashment for employees. Is it mandatory to encash leaves of employees retiring/leaving? If yes, what's the calculation for the same?
From India, Mumbai
From India, Mumbai
Yes, it is mandatory to encash Earned leaves upon separation of employee. Please check Factories act or shop & establishment act, whichever is applicable to your organization.
Calculation - (Last drawn basic/30)*number of Earned Leaves
Regards
Rahul
From India, Delhi
152Calculation - (Last drawn basic/30)*number of Earned Leaves
Regards
Rahul
From India, Delhi
Hi
Usually when an employee resigns or retires the leaves will be calculated in the same manner as salaries. It depends on your company as to how many days per week do you work and the calculations thereof. If it is 5 day week like in many IT sector, the calculation for 25k salary [as example] will be 25000/20 x [the number of days worked in the month].
Encashment of leaves in some companies are done on the basic salary when the leaves [earned/privilege] are over and above 60[as per the Shops & Establishment Act] or as per the company policy.
An employee who is leaving the company has to be cleared of his earned leaves apart from the other benefits applicable.
Thanks and Regards
From India, Hyderabad
Usually when an employee resigns or retires the leaves will be calculated in the same manner as salaries. It depends on your company as to how many days per week do you work and the calculations thereof. If it is 5 day week like in many IT sector, the calculation for 25k salary [as example] will be 25000/20 x [the number of days worked in the month].
Encashment of leaves in some companies are done on the basic salary when the leaves [earned/privilege] are over and above 60[as per the Shops & Establishment Act] or as per the company policy.
An employee who is leaving the company has to be cleared of his earned leaves apart from the other benefits applicable.
Thanks and Regards
From India, Hyderabad
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