Hi,

For encashing the earned leaves first you need to define the accumalation limit of EL. Any earned leave accumalated above the set limit can be encashed.

You can refer the minimum limit of accumalation as specified by labout law.

 

Dear  Sir,

I am of the opinion that the accumulation of leave should not be more than 3 years. In case of employee entitled for say 30 days after completion of 240 days working, the accumulation should be 90 days. i.e. at any given time it should not be more than 90 days. any leave balance above 90 days should either be availed or encashed.

Regards

s p vaidya

Hi, Vishal.

 

Leave encashment here in PH is being observed by numerous government agencies and private organizations. There are also companies that are not giving this kind of benefit. If I am to suggest, this is one value-added service that you can introduce in your organization.

 

First, you have to conduct a study in your company on the leave consumption / availment of your employees, both vacation leaves and sick leaves. You have to know if this will be a motivation for them to increase their productivity. If you are introducing a policy, find out how you can link / relate it with your companies vision and mission.

 

If this will undoubtedly increase their productivity and will help in achieveing your organization's objectives then draft a policy by all means. You may want to consider the following parameters:

 

1. Determine the kind and the number of leaves that a permanent / regular employee can avail.

Example: VL only or SL only; minimum of (no. of leaves) to a maximum of (no. of leaves)

 

2. Determine if the availment will be within the calendar year or after the calendar year.

 

3. Should there be a minimum leave credits available balance that you will require prior to availment of employees for encashment or none.

 

Always remember that it should be a win-win solution for the organization and for the employees.

 

Thanks,

Jeng