Mr. Malhotra has given valuable advice.Kindly follow it.
The title of your query is;
Leave encashment is part of ctc
The query stated in your post pertains to deduction of Leave Encashment amount (Rs.1000) Every month from my salary……………………………….
You may clarify if the company has been deducting this amount from your salary and that has it shown this deduction in salary slip? If yes it is unethical and may be termed unlawful…………………this would amount to deduction of amounts from salary and keeping it with employer to be paid later…………..if at all employer pays it later……………………..!!!!!!!!
Or the leave encashment is inserted in CTC sheet issued to you.
The companies and employers are more and more getting inclined towards issuing CTC remuneration to employees and are finding ways to pay less and less cash in hand……………
The question arises n leave encashment be part of CTC………………….another question also arises is that the benefits and amounts which are statutory in nature and are to be provided to employee by employer, be added in CTC remuneration or not………………………………….e.g. leve encashment, Gratuity, bonus………………
Inserting leave encashment in CTC seems to be wrong as eligibility of employee may differ, It may also change with change in Basic wages………………and it may not be possible to forecast how many leave employee accumulate, avail and how many he may encash, when he may avail and/or encash……………………….
Have you accepted the FNF statement as true and correct?
What is this establishment: Industrial or Commercial or Small Enterprise……………?
You are in which state and redg. office/HO of the company is in which state?
--------If it is a Factory refer to: Section 79 of Factories Act 1948:
Every worker who has worked for a period of 240 days or more in a factory during a calendar year shall be allowed during the subsequent calendar year, leave with wages for a number of days calculated at the rate of-
1. If an adult, one day for every twenty days of work performed by him during the previous calendar year;
In other words: PL at the rate prescribed, i.e. 1 Earned Leave for every 20 days worked.
-------If it is a Small Enterprise then leave policy should be as per
The Small Enterprises( Employment Relations) Act 2002:
Under chapter IV - conditions of work , clause no 11 point 4:
A worker shall be permitted to accumulate leave upto 45 days in addition to the leave entitlement of the current year earned on the basis of the work done by him in the previous year and he shall be entitled to encashment of entire accumulted earned leave including leave earned during the current year pro rata in case his services are terminated or he quits the service
------If the establishment is registered under Shops and establishments of the state then;
(Name of the state) Shops and Establishments Act provides for provisions of leave for the employees. This Act is framed by each State on its own and therefore may be different in its provisions in each state.
You may refer to the Act as applicable in your state. It should be available on the Dept. of Labor website of your state.
------If Industrial Employment Standing Orders Act is applicable the leave policy shall be guided by the Standing Orders applicable to the establishment.
-----The leave policy can also be as per the bilateral agreement between the workers and the employer.
The leave policy may differ from organization to organization offering better/superior/negotiated benefits…………………..Some organization may grant paid leave on pro rated basis also.
The policy should not be inferior to the provisions of the enactments applicable to the establishment.
Valuable advise of learned experts/members is sought.
