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Prasad (Manager)     03 June 2009

Encashment of Earned Leaves

I have resigned from my company last Month with 1 month notice period (which is over by may 31st), I had 35 Earned leaves before I resigned. My company is an Indian company and now they are not converting my leaves to cash. They are telling me that leaves will converted to cash only those who have completed a service of 5 years and they are showing me their leave policy now. I joined that company in 3 years ago and at the time of joining I signed a paper which says that I can leave them at any point of time so there is no obligation. If that is the contract then where is the question of 5 years Service completion? To be honest, I don't know much about labor laws but I feel that they are trying to take advantage of the situation. but I am desperately looking for some advice now. To me it is not a matter of money, instead it is a matter of honesty and fair professional behavior and self pride.

Please advice, I would really appreciate that. If they are on wrong side then I would definitely teach them a lesson so that in future no one else faces situation like this.



 5 Replies

Binod Kumar Mishra (Government Service)     03 June 2009

Dear Prasad,


can you post your service condition you have signed at the time of joining. there are several rules of leave encashment depend upon the deaprtment, but alomost all are covered on the basis of Central Rules.


please provide the letter then i will be in much a better position to advice you.

sreedhar (advocate)     03 June 2009

Mr. Prasad,

Mr.Mishra has rightly said. We cannot give you a solution without looking into the HR Policy and other relevant doucments.

badrinath (Sr.Manager-human resources)     05 June 2009

if its a " factory",  earned leave should be given as per factories Act.  as per the Act,  balance of earned leave , if  any, should  be  reimbursed  at the time  of leaving.  HR policy  never  comes  in the picture.what  your company  is doing  is  unethical and  it is not correct. 

Hari.K (service)     10 June 2009

Mr. Badrinath, will you please send me the related clauses in the Factories Act regarding encashment of earned leave at the time of superannuation?

regards hari k

badrinath (Sr.Manager-human resources)     10 June 2009


             Pl. refer sections 78 and 79 of the Factories Act which deals with Annual leave with wages.

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