Saturday, December 27, 2014

Question and answer on Labour LAw compliance in the organisation- Transcript from the HR Shapers Group 1 discussion

Rigveda says, let the knowledge come through all the ways and exactly, Ashish is doing the great things selflessly. Devoting one's time for a noble cause is the greatest sacrifice. He is exactly doing so. 

Labour law compliance is one of the most complicated subject matter and I am still learning this despite of my great interest and knowledge into the subject. For HR, it is a headache as well as the matter of retaining organisation's pride and justice. Ashish has done great job by bringing a subject matter expert. 

Yesterday I wrote that the topic was most discussed in HR Shapers, but this topic has broken the record with 34 participants alone in group 1. The discussion is lengthy. If you are an HR and reading this article for a quick answer, please do not do it. Every question and answers have practical applicability of the complex issue related to labour laws and workplace management. If you are a learner and want to understand the subject deeply, then only this article is useful. I am sure, you would like to read it again and again. 

12/26/2014 09:19: Participant 1: since I'm working on creating an IR manual...which will be circulated to line managers...and training them with the help of a ppt....I at times wonder how does one talk to business without talking abt laws which are detailed and making this communication simple and relevant.

12/26/2014 09:20: Participant 2: Hi Sid. Would love to know the contents.

12/26/2014 09:22: Participant 3: same here... please share it Participant 1

12/26/2014 09:23: Participant 3: Hi sid. My Id is ……, please share with me as well.

12/26/2014 09:27: Host Speaker: Good Morning , first of all thanks to Ashish for inviting me in unique chat session . Would try to answer as many questions/  queries posted .

I don't consider myself an expert on HR and HR compliance, but believe that one gains knowledge by sharing knowledge

12/26/2014 09:24: b: Guys VGM...welcome to 2nd Express Chat...fortunately 1st Express Chat guest speaker was Pratik big big thank 2him...

12/26/2014 09:29: Host Speaker: Since most of the numbers are not there with me , please give intro or atleast name of the person asking questions , this will help me to address in a better way.

12/26/2014 09:24: Moderator: This chat is open as Pratik is comfortable with that anybody can question anytime...since I have added him in both groups so he may settle down to answer your question in some hv patience...u can remind him in a group if A don't come in next 1-2hrs...with last time experience in July he was very personal msg to him otherwise he will be de-focused..

12/26/2014 09:29: Participant 5: Hi Pratik... welcome again.....

12/26/2014 09:25: Moderator: If possible, save your Whatsapp name as yours n company just for today, so it will be helpful and easy for him to understand belong to which company....
12/26/2014 09:25: Moderator: Already started...over 2u Pratik..

12/26/2014 09:31: Participant 1: Employees absconding...continuous absenteeism...principles of natural justice...process of pip...understanding sales and promotion act..provisions in id act and standing orders.

12/26/2014 09:32: Participant 1: Termination

12/26/2014 09:28: Moderator: Sidd...seems Q incomplete.

12/26/2014 09:33: Participant 6: Hello Pratik, Nice Connecting with you again. Would appreciate if you could share once again on the changes in the apprentice act. Thanks

12/26/2014 09:33: Moderator: Guys just one request since its all related to HR Compliances...your Q has 2b very crisp, smart,sharp and not very open ended for which one can do specific...

12/26/2014 09:40: Host Speaker: Sidd , your question is more generic , please elaborate or come to the point !

12/26/2014 09:42: Host Speaker: There is whole loads in changes in apprentice act , they have added much more vocational streams. 

Please go to or visit at Sion campus and meet Mr. V V Deshmukh . He will guide you .

They want companies to implement and adopt apprentices as a CSR activity

12/26/2014 09:44: Participant 7: good morning Pratik.

12/26/2014 09:46: Host Speaker: Good Morning all

12/26/2014 09:47: Participant 7: my question is as per factories act and shop and establishment act at the time of inspection they are asking formats which are maintained in hard copy. Can we maintain in soft copy whether that is acceptable. if not, what should be the procedure to maintain in soft copy.

12/26/2014 09:49: Participant 1: Let me ask  more specific conducted a review for an employee who was continuously false reporting to a medical representative...and showed him the proofs of it...He declined..and did not sign MOM and refused to a result company terminated him..And then through a local union he has raised this dispute to labour commissioner...without domestic enquiry but a review conducted with hr and manager how strong would be his case in the court of law.

12/26/2014 09:51: Participant 8: You can submit application to the respective department for exemption for maintaining hard copy.. they will verify eformat and approve.

12/26/2014 09:53: Host Speaker: As far as Maharashtra is concerned , one needs to take exemption to maintain computerized records exemption before you actually start maintaining records . Though IT policy 2000 specifies you can have documents in soft copy , but the corresponding effect Unfortunately is not given in labour laws acts and the inspectors harp on this.

You can take exemption under Rule31 of Maharshtra Minimum Wages Rules or Maharashtra Factory rules .

Once you have that , it will give exemption to Muster , wage register , pay slips and leave records

THERE IS NO NEED OF EXEMPTION and no provision for the  rest of the acts like Maternity Benefit , Equal Remuneration , CLRA. You need to maintain in exact same format as required under the act - hard copy or soft copy.

12/26/2014 09:55: Host Speaker: Domestic Enquiry is MUST to prove the employee has done a misconduct and he has accepted it . Mere HR observation won't help . With Such misconduct , HR needs to conduct domestic enquiry as well as report to police for misrepresentation . If HR doesn't want to get in to this , ask the resignation from the employee

12/26/2014 09:56: Host Speaker: Without domestic enquiry , the act may be termed as Unfair Labour Practice and Union may sue under MRTU & PULP.

12/26/2014 10:01: Participant 7: We have given a letter to the  labor office for the exemption to maintain in soft copy. what further action to be taken by us now. for shops ans establishment what is the rule to maintain in soft copy.
12/26/2014 10:06: Host Speaker: If you are seeking under Minimum Wages rules under Form II Reg 27(1) and (2) , no need of taking separate exemption for shops
12/26/2014 10:06: Host Speaker: You need to meet the DLC and ask for queries or send reminders
12/26/2014 10:12: Host Speaker: Hope all queries answered till now . Please put again if missed
12/26/2014 10:14: Participant 1: Thanks a lot Pratik
12/26/2014 10:16: Host Speaker: Friends please note , please go and register yourself for FREE on

It's an entire encyclopedia of Labour Laws

12/26/2014 10:34: Participant 7: thanks Pratik

12/26/2014 10:37: Participant 9: Pratik....can someone who has produced falsified expense details (fake railway tickets) be terminated directly on this ground....if not, what would be the right process?
12/26/2014 10:40: Host Speaker: If he is a workman then domestic enquiry to prove misconduct , else any managerial cadre can be removed directly.

12/26/2014 10:41: Participant 10: Hi Pratik what amount of paid holidays mandatory to be given as per shops n establishment act
12/26/2014 10:44: Participant 11: If someone take unplanned medical leave without any health issues and produce fake medical certificate from  doctor. Can we terminate such employee?
12/26/2014 10:52: Host Speaker: Every Misconduct done by any workman other than managers - DOMESTIC ENQUIRY is MUST before termination
12/26/2014 10:53: Host Speaker: Dear Amit - as per Sec 35 of Bombay Shops & establishment act , leaves to be granted are 21 and holidays to be given are 4 National holidays and optional / additional 5 festival holidays.

12/26/2014 11:00: Participant 12: Pratiksha there are softwares available which supports functions in the format as well as timely compliance of HR statutory compliance. In one of the organisation I worked for we used a tool called as legatrix.

12/26/2014 10:56: Moderator: J

12/26/2014 11:02: Participant 12: Sport again please read the name as Pratik no offence meant to you Pratik.

12/26/2014 11:04: Participant 13: Pratik thanks for joining in. I was recently doing social work for an NGO, its a trust that runs schools across a few states in India. The question is which laws govern the disciplinary process for schools in case of misconducts etc.

12/26/2014 11:05: Host Speaker: Hey Participant 12 no worries - is the answer for this .

12/26/2014 11:05: Participant 14: Is it necessary to keep all  exited employees record for 7 years post they leave?

12/26/2014 11:05: Participant 15: Hi Pratik, would like to know whether employer can hold Full and Final Settlement, Gratuity and PF if the employee is terminated on the grounds of misconduct (non-monetary)

12/26/2014 11:06: Participant 10: Thanks Pratik

12/26/2014 11:12: Host Speaker: If domestic enquiry is conducted and misconduct proved , then Bonus and Gratuity can be forfeited to extent of monetary damages , else not . PF you Anyways, have to pay.

12/26/2014 11:13: Host Speaker: As far as records are concerned , shops and establishment and payment of wages have provisions for 3 years , ESI have 5 years and PF till now no limit . The years specified above are  from the current date backwards.

12/26/2014 11:14: Participant 15: Thanks Pratik but what if there is no monetary damages.

12/26/2014 11:15: Participant 12: Pratik we ask the eligible separating employee to fill in the Gratuity claim form post which we process gratuity.

Do all organisations follow this compliance and is it a must

12/26/2014 11:16: Participant 13: @ Participant 12 - at SCB this form is a part of our exit process

12/26/2014 11:18: Participant 14: Pratik, You mentioned above that employees can be terminated with domestic enquiry if proved it the same process for manager level as well?
If i have understood above points correctly
12/26/2014 11:21: Host Speaker: @rakesh Act is silent about it.

12/26/2014 11:23: Participant 13: Hi. I was recently doing social work for an ngo, it’s a trust that runs schools across few states in India. The question is which laws govern the disciplinary process for schools in case of misconducts etc.

12/26/2014 11:28: Host Speaker: Since NGO are not covered under BOMBAY Shops and establishment act and they do not fall under industry as defined under payment of wages act , it's difficult to establish , unless you have your own service rules and policies to govern indiscipline , that becomes the mandate provided employees are notified and they have accepted the same

12/26/2014 11:23: Host Speaker: Participant 12 - application for notice in Form I and notice by employer to employee in Form L is must under PGA . Many organizations follow this.

12/26/2014 11:24: Participant 12: Thanks Pratik like I said at Deloitte we too follow the same

12/26/2014 11:25: Participant 12: Thanks Robert
12/26/2014 11:29: Participant 13: Will the trust act apply.

12/26/2014 11:29: Participant 16: Hi Pratik . My question is : once an employer initiates the performance improvement plan with proper email, bi-monthly meeting and final review meeting. If the result is negative and the employer wants to give a grace period of 1 week for exit , is this ok from compliance point of view disregard of notice period being 1 month. Also can this process of exit be same for permanent & probationary employees.

12/26/2014 11:29: Host Speaker: Bhushan - workman which are non- supervisory , non managerial , non administrative cadre , if manager does the misconduct , he can be terminated immediately.

12/26/2014 11:29: Participant 13: Aren’t schools an establishment ?

12/26/2014 11:31: Participant 12: I agree with Pratik neither does it come under the definition of employer under the Industrial Disputes Act.

12/26/2014 11:32: Participant 15: Thanks Pratik.

12/26/2014 11:32: Host Speaker: I don't think Indian Trust Act has provisions for employees or disciplinary action.

12/26/2014 11:32: Participant 13: So in summary - they should hv thier own employee code of conduct.. And notify employees that they will be governed by it.

12/26/2014 11:33: Host Speaker: I am not SME for trust , cannot comment , but am sure there are no provisions , please check.

12/26/2014 11:33: Host Speaker: Correct Robert

12/26/2014 11:33: Participant 13: Thanks Pratik... Helpful

12/26/2014 11:37: Participant 12: Thanks Pratik would like to compliment you the discussions and your interaction has been very helpful and insightful.

12/26/2014 11:38: Participant 16: Hi Pratik . My question is : once an employer initiates performance improvement plan with proper email, bi-monthly meeting and final review meeting. If the result is negative and the employer wants to give a grace period of 1 week for exit , is this ok from compliance point of view disregard of notice period being 1 month. Also can this process of exit be same for permanent & probationary employees.

12/26/2014 11:41: Participant 17: Hi Pratik, I have a query if any employee has been asked to look for opportunity outside due to company downsizing manpower and he disagrees. Does management has rights to terminate him or by default put him in the exit process.

12/26/2014 11:43: Host Speaker: Nizari - it is difficult to terminate employee buy easier to ask for resignation with one month notice pay because of his non – performance.

12/26/2014 11:45: Host Speaker: If any employee is terminated , the reasons have to be cited and submitted to labour office . Explanation to be given that whether tere was any alternative Emplyment available in the Organisation of particular job role did not suit him . Whether capital punishment of termination is really required in the absence of misconduct.

12/26/2014 11:47: Host Speaker: Padmaja - Organisation has to follow retrenchment process as per sec 25-C and 25 G under Industrial Disputes Act

12/26/2014 11:47: Participant 16: Pratik - thank you for response but what u suggested is ideal situation so in that case is it stringent to follow 1 month or based on discussions employer can alter it from 1 week to 4 week?
12/26/2014 11:49: Host Speaker: I am happy and amazed to see so many queries and participation on working day , hope I am quick enough to clarify.
12/26/2014 11:49: Participant 16: Yes Pratik.
12/26/2014 11:50: Participant 15: Pratik you are super fast
12/26/2014 11:50: Participant 16: Padmaja - I am undergoing a similar situation for set of 50 employees for a different location, let me know if you need help there, I can guide you to the best.

12/26/2014 11:50: Host Speaker: If he is on probation 14 days , else one month - refer to Sec 66 of the Bombay shops & establishment act in
12/26/2014 11:53: Participant 16: Thanks Pratik
12/26/2014 11:55: Participant 17: Thanks Pratik.
12/26/2014 11:57: Participant 17: Thank you Nizari,we are going through this situation pan india with identified employees.
12/26/2014 11:57: Host Speaker: Care should be taken for downsizing.

12/26/2014 11:59: Participant 17: And been facing such issue with majorly with the ones old in the system
12/26/2014 12:00: Host Speaker: Tips - first of all you need to have a proper transfer clause in the appointment letter.
Offer the employee to shift or transfer to another city as closure or downsizing in a particular city
9/10 employees would rather quit than get transferred especially lower income groups
Offer alternative Employment with complete different role
Do it in phased manner , in all probabilities employee would render resignation
Give them ex- gratia equivalent or more than Retrenchment compensation, but term it as Ex- Gratia

12/26/2014 12:06: Participant 16: Steps said Pratik are absolutely true. What I want to understand is does retrenchment has to be dealt on commercial ground like paying 1 /2 month salary or giving them payout till official notice period ends is also fine. Pratik please reply.
12/26/2014 12:17: Participant 17: We have applied the above steps and got the results too. The one resigned after options provided are been paid as per notice period and will be active in system till the last official working day.

12/26/2014 12:20: Participant 17: Question rises with the employees those who are not Ok with options and not even ready to resign. Would like to know what can be done in such cases.

12/26/2014 12:21: Host Speaker: Retrenchment or ex- gratia is Minimum 15 days salary per year of experience . To be calculated as last drawn wages /26 days x 15 per year

If you are closing down an undertaking / branch , need to give 60 days prior notice and atleast 3 months of average pay
Refer Sec 25 FFF of ID Act
12/26/2014 12:28: Host Speaker: We are coming up with comply4hr conclave soon at Delhi / Gurgaon where industry experts as well as commissioners of PF , ESI labour are speakers and share their knowledge . We had a maiden launch on September 12th in Mumbai and was attended by more than 175 HR professionals

12/26/2014 12:37: Participant 18: Great Pratik, please provide more details of the conclave for us to attend
12/26/2014 12:33: Moderator: Guys...thank you so much for this great interaction going on and sure all query getting the way I have kept the provision for lunch break 1pm - 2pm for guest speaker...but Pratik is so enthusiast that he would like to continue this so same applicable for you guys...also other members (mute)  come forward to ask any query related to HR Compliances...Pratik would b happy to answer. He is here with us till 9pm...Ask later in a day if not now but ask if you  have any query related to HR compliance....special thanks to Pratik to be so quick and upto the point to answer all Q...great going...keep it up.

12/26/2014 12:38: Participant 18: For everyone asking exit related questions, its always easier to coax the employee to resign and be prepared to pay a reasonable sum, this has rarely backfired in my observation
12/26/2014 12:40: Participant 18: Hi Pratik, my question is generally what a the number of apprentices to be employed within IT industry? Can trainees who are fresh grads from engineering colleges be considered in this category? The salary being paid is significantly higher than specified in the act.

12/26/2014 12:42: Host Speaker: Yes , can you share your name, please of whoever asking apprentice query.
12/26/2014 12:42: Participant 18: Also, what are the provisions of leave encashment? To the best of my knowledge an employee can accumulate up to 42 leaves in a year and orgs cannot forcefully lapse leaves below this number. Therefore, if we choose to encash them at the end of the year with some amount carried forward to the next year is that legally OK?

12/26/2014 12:42: Participant 18: Pratik this is Participant 18 from A leading MNC.
12/26/2014 12:45: Host Speaker: Hi Ankur , guidelines under apprenticeship act is At least 10% of the base workforce to be apprentices . You can very well employ fresh engineers and register or route it through Board of Apprentice Training as apprentices . The minimum stipend for Graduate apprentices is ₹3560 . You can definitely give more
12/26/2014 12:46: Host Speaker: Check
12/26/2014 12:47: Host Speaker: As far As BOMBAY shops & establishment act is considered it is 42 days. 

For complete reckoner of leaves provision pan India , refer

12/26/2014 12:43: Moderator: Pratik..Proud to have you as a Guest Speaker on HR Shapers 2nd time. Really appreciate.

12/26/2014 12:48: Host Speaker: J
12/26/2014 12:49: Participant 18: Agree with are an asset Pratik!

12/26/2014 12:49: Participant 18: Thanks Pratik...would it also have provisions on whether leave encashment is to be done on basic or gross salary?

12/26/2014 12:52: Host Speaker: There is no provision for leave encashment in any act except time of separation . Since wages under Bombay shops & establishment is referring to payment of wages act which defines wages as all remuneration , need to pay on gross

You are not going to deduct only basic and DA and provide other allowance of the emplyee is absent or taken leave , thus while giving leave encashment you need to give full gross and not only basic and DA

12/26/2014 12:53: Host Speaker: If*
12/26/2014 12:54: Participant 10: Is it to be paid on gross....Pratik
12/26/2014 12:55: Host Speaker: Yes on Gross wages , all remuneration and never on basic + Da
12/26/2014 12:56: Participant 18: Thanks Pratik that really helps clarify!

12/26/2014 12:59: Participant 19: I remember when I got my leave encashment after quitting XYZ Consulting, even I was under the impression it is just basic. Was pleasantly surprised at it being last drawn and so was a significant amount. At that time I thought it’s that company's policy and not mandated by law

12/26/2014 13:03: Participant 20: Yes, however tax exemption is only on basic + DA, would that be right, Pratik? - Participant 20

12/26/2014 13:04: Participant 14: I guess ..I got on basic.

12/26/2014 13:04: Participant 17: Can an ex employee take any action if the leave encashment is paid only on basic?
12/26/2014 13:05: Participant 17: As even in my last organisation and current one we had been paying the leave encashment on basic at the time of separation
12/26/2014 13:13: Host Speaker: Tax exemption has nothing to do with basic and da
12/26/2014 13:13: Host Speaker: Tax is always on total earnings.

12/26/2014 13:13: Participant 21: Many organizations do leave encashment on basic only....
12/26/2014 13:14: Host Speaker: There may be exemptions on HRA , conveyance , medical reimbursement.

12/26/2014 13:14: Participant 21: Please advice on what's could be reference for the same 

12/26/2014 13:14: Host Speaker: That's criminal Participant 21 , ideal and logical and statutory is gross wages

12/26/2014 13:14: Host Speaker: Vikram is lucky , Bhushan is not J

12/26/2014 13:16: Participant 19: I guess this is also why a lot of asked were asked to take leave in December when slowdown was happening. They knew that with payout at last drawn it would be a big payout in tough times.

12/26/2014 13:18: Participant 21: Hi Pratik, good afternoon. Participant 21 from a leading IT consulting. I have 3 questions. #1) If maximum leave accumulation is capped at 42, can organisations I internally fix a cap less than that? Infy policy says - 50% leaves credited in d year needs to be taken - else they will get lapsed. Max accumulation cannot be more than 30. Is this correct in the light of d law?
12/26/2014 13:19: Host Speaker: Hi guys ,we will take a break of half hour and resume at 1.45-2.00 pm

12/26/2014 13:19: Participant 19: J

12/26/2014 13:20: Participant 21: Sure, will share other 2 questions post d break

12/26/2014 13:20: Participant 21: Thanks a lot Pratik J

12/26/2014 13:21: Participant 19: BTW guys performing at the canvas laugh club at palladium mall, phoenix mills today and Sunday. 8:30 show. Hope to see you guys there

12/26/2014 13:22: Participant 3: J
12/26/2014 13:22: Participant 18: Thanks Pratik...please share the name of the act for leave encashment references asked by Participant 21 too.

12/26/2014 13:18: Moderator: Yup can take....break mangta hai...2.15-2.30pm wud b fine...guys - hold down till then...

12/26/2014 13:23: Participant 18: Sure...enjoy the lunch Pratik!

12/26/2014 13:23: Participant 21: Good session J

12/26/2014 13:37: Participant 16: ABC - for separation under  branch or unit closure, 1st step is to ask every employee resign and HR accepts resignation with a date as per official notice period.

12/26/2014 13:50: Participant 6: Simply superb Pratik

12/26/2014 13:50: Participant 6: J

12/26/2014 13:50: Participant 6: Gr8 session

12/26/2014 13:51: Participant 6: Having gr8 learning.

12/26/2014 13:51: Participant 6: Many thanks for your time

12/26/2014 14:17: Moderator: You can go and register yourself for FREE on
It's an entire encyclopedia of HR Compliances n Labour Laws...

12/26/2014 14:25: Participant 22: Pratik question. Employee married, however his nominations have parents name. Can company withheld disbursement for PF Full and Final settlement, gratuity life cover insurance asking them to submit succession certificate. Or they should disburse to nominee on record. Will same apply if no nominations.

12/26/2014 14:21: Moderator: Wait guys...Pratik yet to be back fm break...I know v all waiting for him to join back....hold down your query till then...

12/26/2014 14:33: Host Speaker: Abhishek - as per Sec 35 of Bombay Shops and establishment act , maximum leave accumulation is 42 days . If you reduce this accumulation , you are depriving the employee and if he resigns after two years , he would only get 30 days instead of 42 days leave encashment , provided he has not taken leave at all . If 50% of leaves are taken , balance cannot be lapsed but accumulated . What your company is doing is allowing to forcible take 50% leaves and balance accumulate upto 30 days . It will never go till 42 days.

12/26/2014 14:34: Host Speaker: Succession certificate with affidavit works for PF but not for gratuity . There are lot of cases and disputes relating to claiming gratuity . Recommended to always have updated forms of nominations, especially in Gratuity cases
12/26/2014 14:37: Moderator: Pratik is back now for the post lunch session...ðŸ‘ðŸ‘👌...over to both of u guys...

12/26/2014 14:45: Participant 23: Hi, Sujata from ABC
Does a spouse who is nominated for PF also need to submit a succession certificate?

12/26/2014 14:47: Participant 23: And suggest as a best practice, we should send out the relevant nomination forms for updation as soon as we have an intimation of a marriage.
12/26/2014 14:48: Participant 23: Best probably could be when the employee apply for enrolment to the group mediclaim policy

12/26/2014 14:49: Participant 23: Applies

12/26/2014 15:13: Host Speaker: Sujata - if wife if the emplyee has already been nominated post marriage , no need of succession certificate . Best practice is to have nomination form of PF and gratuity re-filled after change in marital status . PF no issues , but Gratuity big issues

12/26/2014 14:59: Participant 24: Hi Pratik, Monisha here. We have a variable component which gets paid on a quarterly basis. Do we have any act/ guidelines for the same? For resigned employees, they need to be active in the payout day to receive the variable amount. An employee whose last working day is on 28th Jan, will not receive payouts for Oct-Nov-Dec quarter, though he has worked in that quarter. Please suggest if there is any applicable act.
12/26/2014 15:01: Participant 24: Can the organisation deny payout on that ground?

12/26/2014 15:15: Host Speaker: Monisha - anything which is above minimum wages and also the terms part of Employment contract or appointment letter , there is no law governing it , but need to ensure proper communication is given to employee with his acceptance else it can go for industrial dispute.

12/26/2014 15:02: Participant 18: Thanks Pratik...however, if we encash unavailed leave at the rate of gross salary at the end of the year and pay an employee is that OK? Or that's only at the time of exit?

12/26/2014 15:04: Participant 18: While on the subject of it legal to include weekends as leave if they fall between two paid leaves? My understanding is that is true if an employee is on leave without pay and not in the case of earned leave. Any weekends falling between 2 paid leave must be treated as weekends and not leaves, right?
12/26/2014 15:07: Participant 18: Also, as per shop act each employee is entitled to 21 leaves in Maharashtra, is it inclusive of statutory holidays? My understanding is that all festival and statutory holidays are outside the 21 days leaves which accrue at the rate of 1.75 per month. Please advise and confirm.
12/26/2014 15:07: Participant 18: Can the org break the 21 leaves into different types of leaves or give less than that for probation period?
12/26/2014 15:08: Participant 18: Final question...Maharashtra leaves cannot apply in other states and it needs to be as per state laws for each state, right?
12/26/2014 15:09: Participant 18: Sorry for such basic question, I am sure of the Act but reconfirming nevertheless, since this came up in a discussion yesterday...thanks!
12/26/2014 15:09: Participant 25: The last question, Ankur- That's right.
12/26/2014 15:10: Participant 18: J
12/26/2014 15:10: Participant 25: Back from a small vacation before I go again on another one from Tomm. Missing out participating...
12/26/2014 15:10: Participant 18: Ahhh well enjoy!

12/26/2014 15:10: Host Speaker: Hang on guys was in a concall

12/26/2014 15:11: Participant 25: J

12/26/2014 15:10: Moderator:  - 2 queries...1 - LTA - act is silent in terms of how many days leaves 2b considered while claiming LTA... whether 3 or 5days.... 2. We have flexi components to be declared and paid as taxable and non-taxable..the declaration window open only one time in year / beginning of the year...if declared either way we make the payment accordingly...what if not declared by employee when asked...can we pay as the taxable amount monthly or end of year...

12/26/2014 15:22: Host Speaker: LTA has to be given in 4 block period in 4 years , 2 are exempted under sec 10 aaa of income tax

an 12/26/2014 15:23: Host Speaker: LTA has to be 5 days and not 3 days

12/26/2014 15:35: Host Speaker: You are right Ashish , industry standard is 5 or more than 5 days , then eligible for LTA

12/26/2014 15:31: Moderator: Ok
12/26/2014 15:36: Host Speaker: I have not come across companies having 3 days LTA , it's generally 5 and more .
12/26/2014 15:36: Host Speaker: Though act is completely silent on Thai

12/26/2014 15:16: Participant 24: Thanx Pratik.

12/26/2014 15:16: Participant 16: Thanks Pratik, I too had question on qtrly performance incentive payout and you answered it so right.

12/26/2014 15:19: Participant 2: Hi Pratik

12/26/2014 15:19: Participant 2: My question is related to CSR

12/26/2014 15:19: Host Speaker: Ankur - all queries related to leave -

There is no provision for leave encashment on an annual basis , if company is giving for the benefit of the employee on yearly basis, it's allowed

Leaves are actually inclusive of any weekends . So of an employee takes leave on Friday and Monday , it's actually 4 days leave and includes intervening holidays

As far as The Bombay Shops Establishment Act for Maharshtra is concerned , 21 has to be privileged leave and accumulations upto 42 Days.

12/26/2014 15:20: Host Speaker: Every state has its leaves . For complete leaves details pan india , visit

12/26/2014 15:20: Participant 2: What are criteria for qualifying CSR spend?

12/26/2014 15:24: Host Speaker: Nothing in labour laws for CSR
12/26/2014 15:25: Host Speaker: Refer income tax act on proper provisions under Sec 10(14) for LTA
12/26/2014 15:28: Moderator: Pratik - some org paying LTA for 3 days...act has mentioned anything abt no of days...
12/26/2014 15:35: Participant 23: Thanks Pratik. Really appreciate.

12/26/2014 15:40: Moderator: is live Host Speaker - our guest speaker of 2nd express chat session...he is busy answering all queries of both groups members...

12/26/2014 15:45: Host Speaker: Lol !!!

12/26/2014 15:46: Participant 23: Pratik, you look much younger than you sound :)
12/26/2014 15:46: Participant 25: ‘ Awesome responses Pratik. Bless you for your time..


12/26/2014 15:46: Host Speaker: Need some palm greasing now .... Oops Palm massage

12/26/2014 15:47: Participant 25: From all of us.... DSP...

12/26/2014 15:47: Host Speaker: Thanks for telling me young , I will tell this to my wife !!

12/26/2014 15:43: Moderator: order on flipkart...I will pay...
12/26/2014 15:47: Participant 26: J
12/26/2014 15:48: Participant 25: DSP - Not Director Special... Dher Saara Pyaar... :)

12/26/2014 15:49: Participant 25: Whoa ! Whoa!... 

12/26/2014 15:56: Moderator: Retain all wishes as well for pratik because, Pratik is joining us on 1st Feb for Mcdowell Durbey Race @ Mahalaxmi Race Course followed by drink at Gokul / Lepold Cafe and dinner at Bade Miya / Bagdadi...

12/26/2014 16:01: Participant 26: Pratik kiski wife ko bataoge?
12/26/2014 16:01: Host Speaker: J J J
12/26/2014 16:02: Host Speaker: Please spare me from your queries that time , ask whatever today.
12/26/2014 16:02: Host Speaker: Just kidding , open for discussions and knowledge sharing , anywhere , anytime
12/26/2014 16:02: Participant 23: J
12/26/2014 16:03: Host Speaker: Any more questions please
12/26/2014 16:03: Host Speaker: No one is asking on Shram Suvidha portal ??
12/26/2014 16:04: Host Speaker: Extremely important compliance for all organisations .

12/26/2014 16:00: Moderator: Also PF recent announcement
12/26/2014 16:01: Moderator: Lots of mail going on the same
12/26/2014 16:05: Host Speaker: Http://

12/26/2014 16:05: Participant 16: Pratik - if the employer changes the the duration of notice period as a part of change in HR policy and procedure, can that be challenged by an individual as the appointment letter would have different notice period.
12/26/2014 16:06: Participant 16: Ashish can we have a gmail group where certain announcements can be shared with all members.
12/26/2014 16:09: Host Speaker: If your appointment letter says that as per HR policy framed time to time , then it should not be an issue , proper communication to te employee and proof that you have demonstrated that communications should be acceptable.

12/26/2014 16:09: Participant 16: Done, am safeJ

12/26/2014 16:10: Host Speaker: It's always safe to get confirmations from all employees on change in HR policy and important clauses should always be part of appointment letters

12/26/2014 16:12: Participant 16: Pratik - for companies who are still evolving , major communication will go as a part of policy change which can than be implemented as a part of appointment letter for new joiner but changing appointment letter for present employees is time consuming? In my opinion.
12/26/2014 16:12: Participant 20: In our case, we had incorporated such changes in the increment letter giving reference to Policy changes and appointment contract. Alternatively, sending out an email and asking employees to confirm by clicking the "Yes" tab concerning reading and accepting the terms helps
12/26/2014 16:14: Participant 16: In our case policy changes are highlighted with versions and the said clause is highlighted in the summary of the policy. We cannot the taking acceptance from every employee as it will be never ending than. Do in such cases managements discretion plays a vital role.
12/26/2014 16:20: Participant 16: Pratik - if a woman employee is on maternity leave followed by sabbatical, should an employee credit leaves during sabbatical ? and while encashment should an employee ideally payout remaining leaves in the kitty and than start on with sabbatical. ?- your views please from compliance point.
12/26/2014 16:26: Host Speaker: As far as maternity benefit Act is concerned apart from 12 weeks leave , due to some complications , employee can avail additional one month leave . Any leaves over and above this would LWP or debit from her existing leave balance.

12/26/2014 16:35: Host Speaker: ASHISH , have shared LTA guidelines to your email id

12/26/2014 16:35: Participant 25: Prateek, just to reconfirm, post maternity related complications, you mean, by law, if an employee needs leave, we can give 1 more month of maternity leave over and above the 12 weeks of ML ?

12/26/2014 16:36: Host Speaker: Correct
12/26/2014 16:37: Host Speaker: As per Sec 10 of the act
12/26/2014 16:37: Participant 25: J
12/26/2014 16:37: Host Speaker: Leave for illness arising out of pregnancy , delivery , premature birth , miscarriage , medical termination or tubectomy
12/26/2014 16:38: Participant 25: J

12/26/2014 16:41: Participant 16: Pratik - 1st part is correct that employer had to credit leaves during ML 2nd part where an employee wanted to go for sabbatical not for medical reason but to take care of kid , is claiming from company to deduct her leaves and than do a loss of pay, so if I am considering her leaves I need to pay her for those many no. Of days despite of not working. In such cases is it compliant to pay still not worked to the employee.
12/26/2014 16:45: Host Speaker: If the employee has her leave balance , she can and has right to avail those leaves , once it exhausts , it will be leave without pay
12/26/2014 16:46: Participant 16: Thnks so my dealing is right J
12/26/2014 16:46: Host Speaker: J
12/26/2014 16:48: Participant 17: J

12/26/2014 17:12: Participant 17: Hi Pratik, if an employee is on maternity leave and the organisation comes across some misconduct on her name. Does the organisation has rights to terminate that female employee during that tenure or wait?
12/26/2014 17:14: Participant 25: Ah... Tricky one. Never come across this... Misconduct as in attendance wise or unethical matter...
12/26/2014 17:17: Participant 19: What happens to accumulate leave if an employee puts in her papers while on ML?

12/26/2014 17:31: Host Speaker: Generally no female employee has done that to avail maternity benefit , she resumes and then proceeds for resignation.

12/26/2014 17:30: Host Speaker: ABC, you cannot terminate an employee while the employee is under maternity leave , however, domestic enquiry can be initiated , but cannot suspend the employee and pay subsistence allowance , once she's is back you can terminate.

12/26/2014 17:31: Host Speaker: The accumulated leave would have to be encashed and cannot be substituted with 12 weeks maternity leave.

12/26/2014 17:31: Participant 17: Thank you Pratik.

12/26/2014 17:37: Participant 15: Just to add further, if female employee is covered under employer mediclaim scheme still do we have to pay her mandatory bonus of 3500
12/26/2014 17:40: Host Speaker: No , as per Sec 8 , pre natal confinement and post natal care is given - which is actually mediclaim and hospitalisation ,

12/26/2014 17:40: Host Speaker: Not applicable
12/26/2014 17:41: Participant 15: Oh ok Thanks Pratik

12/26/2014 17:43: Host Speaker: Call us, do check for pan india registers maintenance on cloud

12/26/2014 17:46: Participant 15: If an employee proceeds on PL (overseas) after due approval from Senior Mgmt and while on leave he / She has been asked to resume duties. But for some reason he / She doesn't resume to duty and justify by sending email.
Can employer treat his / her leaves as LWP since he/ She didnt report to duty.

12/26/2014 17:50: Participant 25: I Dont think that can be LWP once the leave is approved.
12/26/2014 17:51: Participant 17: I agree with Meenakshi
12/26/2014 17:58: Participant 15: If done so, Can employee take some action against company
12/26/2014 17:59: Host Speaker: Once the leave is approved cannot be cancelled , too harsh for the employee . He should actually quit the job of something like this happens !!
12/26/2014 18:01: Host Speaker: In fact as per provisions , he is supposed to get 50% of amount due to him on such leave
12/26/2014 18:02: Host Speaker: The employee has right to send intimation to the inspector alongwith such copy of granted leave email
12/26/2014 18:03: Host Speaker: If inspector accepts , employee then needs to carryforward all the unavailed leave without any limit
12/26/2014 18:04: Host Speaker: Hello Friends , would be able to answer last 20 minutes , will resume post 7.30 pm

12/26/2014 18:04: Host Speaker: For *
12/26/2014 18:05: Participant 15: Thanks Pratik for the info

12/26/2014 18:06: Participant 27: Great inputs group, especially the pointed information shared by Pratik!

12/26/2014 18:16: Participant 17: But this kind of scenario happens quite offen with sales employees on account of business requirements.

12/26/2014 18:12: Moderator: Guys....Pratik would be back by 7.30pm....hold down ur queries till then....thank u members n Pratik for lovely knowledge sharing express chat session...kindly wait till 7.30pm to resume...

12/26/2014 18:24: Participant 25: Bless you Ashish for your efforts to gather experts! J

12/26/2014 18:25: Participant 28: Agreed. Ashish...thank you for the wonderful interactions provided by this forum.

12/26/2014 18:26: Participant 28: @Pratik - Thank you for once again patiently responding to the queries.
12/26/2014 19:00: Moderator: Here is our guest speaker’s another photo, but vacation / weekend / masti wala photo...the objective to share photo 2 make the conversation more lively n engaging... but it doesn't mean I share all 200 members photo with him...  ...enjoy last session of express chat on HR Compliances...Pratik will resume at 7.30pm and will be with us till 9pm...

12/26/2014 19:07: Moderator: You can go and register yourself for FREE on

It's an entire encyclopedia of HR Compliances n Labour Laws...

12/26/2014 19:28: Host Speaker: Where did you manage To pick that pic from !!!
12/26/2014 19:35: Host Speaker: I am back

12/26/2014 19:54: Participant 2: One question. Our company has the policy to encash leave every year. All leave either carried forward without any lapsed condition. Can we now stop this for white collar?
12/26/2014 20:10: Host Speaker: There is no provision for leave encashment.

12/26/2014 20:17: Participant 25: Hi Vinod.... You may change the policy of Leave by getting off leave encashment at the end of the year. Leave is meant for employees to enjoy the leave and the purpose is not for leave encashment. Employees may not like this as they may tend to save leave for encashment like any Indian employee. We did away the leave encashment while the employee is in employment + reduced the number of leave which can be carried forward to the next calendar year, some time back, feathers were ruffled obviously but we gave folks a long time to manage their leave and it finally settled down.
12/26/2014 20:18: Host Speaker: However, for benefit employers give option to encash leaves
12/26/2014 20:18: Participant 3: we already stopprd this
12/26/2014 20:18: Participant 3: it’s the boss responsibility that subordinate takes min of 15 leaves in a year.
12/26/2014 20:18: Participant 3: and we are asking employee to take leaves
12/26/2014 20:19: Participant 25: J

12/26/2014 20:37: Participant 2: J J

12/26/2014 20:37: Host Speaker: Hello all , I have to call off as need to go out , but hope have answered as many queries as possible
12/26/2014 20:37: Participant 2: Thanks  all
12/26/2014 20:37: Participant 29: Thank you.
12/26/2014 20:38: Participant 30: Thank you.
12/26/2014 20:38: Participant 3: Thank you
12/26/2014 20:38: Participant 3: Thanks for such a wonderful session
12/26/2014 20:38: Participant 25: Prateek, Thank you for your time once again. Appreciate your powerful selfless sharing.

12/26/2014 20:39: Participant 25: Ashish, Thanks once again on behalf of everyone.
12/26/2014 20:37: Moderator: Hey Pratik..thank you so I wud request Participant 28 to do vote of thanks on the behalf of HR Shapers Group ONE....
12/26/2014 20:37: Moderator: Dharmesh - over to you....

12/26/2014 20:43: Participant 31: Hi Pratik, saw lot of queries you have answered throughout the day.. I was quite busy and couldn't see msg update. It wil be treasure for me to go through all.

12/26/2014 20:44: Participant 28: Its an honuor to be interacting once again with you Pratik and I would,like to thank you on behalf of the HR Shapers group for being available and responding to our questions with so much dedication, commitment and knowledge .

12/26/2014 20:44: Participant 28: Thank you so much Pratik... We are more informed as a group today.

12/26/2014 20:45: Participant 25: J

12/26/2014 20:46: Participant 28: Also wish to extend,my thanks to all the participants who made this happen with their genuine questions and enthusiastic comments....this,is what makes this group such a vibrant community.

12/26/2014 20:46: Participant 28: Thank you Shapers.... for,being the wonderful lot

12/26/2014 20:47: Participant 31: Anyways, I have a question regarding recent changes PF ceiling norms.. Our company management have increased Basic amount as per rule however they kept CTC amount same, which shows employer's contribution is being managed from other allowances. So gross salary amount has been reduced. Is it a fair practice??
12/26/2014 20:55: Host Speaker: As far as it doesn't affect ESI , and above minimum wages it's compliant , however not a fair practice
12/26/2014 20:56: Host Speaker: For recent PF changes , visit blog section
12/26/2014 20:57: Participant 25: Legally this seems OK.But the Gross salary will reduce if CTC is unchanged and this will not seem fair to the employees.  However where will the additional amount come from to match the old Gross salary? This depends on the company's decision to bump up the Gross salary to the older one thereby increasing the CTC. With clear transparent and appropriate communication on this change from each department head to his / her staff should be able to address this change one way or the other. As a fair practise, it is advisable to maintain the old gross salary to manage Employee satisfaction.

12/26/2014 20:59: Participant 25: Else face the wrath of the employees. Surely there will be disgruntlement. Every penny of the gross salary matters and this change will pinch the employees unless the company cares and addresses appropriately.
12/26/2014 21:00: Host Speaker: It is completely unfair labour practice and can go under MRTU and PULP act
12/26/2014 21:02: Participant 25: So Prateek if an employee goes to court on reduced gross salary, he/ she can sue the company on this.... Right?
12/26/2014 21:04: Participant 25: P31... If you have a variable incentive as part of the CTC then you could take some amount from this component to adjust to the old gross salary. This will be taken much better by employees.

12/26/2014 21:00: Moderator: Hey nice of u...njoy weekend n HNY wishes fm HR Shapers....all looking fwd 2 meet u on 1 Feb at Race Course at McDowell Durbey Race...

12/26/2014 21:01: Moderator: Thanks Dharmesh for lovely VOT...
12/26/2014 21:08: Host Speaker: Yes, he can sue the company under PULP
12/26/2014 21:09: Participant 25:  Great Weekend Prateek...

12/26/2014 21:17: Participant 22: Pratik thanks so much for these learning's.
12/26/2014 21:17: Participant 31: Yeah.. Minakshi, you are right, management has decided to pay annual PLP amount monthly to staff and therefore all staffs are happy to get 100% PLP amount. But, affected crowd is Supervisors and Managers whose gross was more than 15000, but basic amt was lower than it.. It affected their net take home...

12/26/2014 21:26: Participant 32: Hey Pratik did have any specific question. Reading all the comments. Thanks you sharing knowledge.

12/26/2014 21:28: Participant 25: Normally P31, that's what most companies do hoping the managers and above will understand this. Be ready for attrition at the managers level. That's a possibility...
12/26/2014 21:28: P32: Wow Pratik.. More than 300 msgs to catch on while I travel back to Mumbai... Awesome..

12/26/2014 21:29: Participant 32: My query.. Professionals like CA, doctors are not covered under any act.. Can they define their own policies - say for leave, LTA or any such..

12/26/2014 21:34: Participant 33: wow Pratik thanks for joining us today..... , I have been a silent listener throughout the day... as in bk to bk to meeting... really appreciate all learning.... ðŸ‘😃
12/26/2014 21:49: Host Speaker: Yes you can say that Participant 32

12/26/2014 21:52: Participant 31: Meenakshi.. To anticipate that attrition issue we have given a letter explaining the fact that what has affected their net salary..

12/26/2014 21:53: Participant 31:Thank God.. No one has left due to this..

12/26/2014 21:59: Participant 7: great learning exp thanks pratik

12/26/2014 22:02: Participant 32: @Pratik which means they can define number of leaves as say PL - 12, CL -3, SL-3 as well.. Or whatever...
12/26/2014 22:03: Participant 34: Thanks Pratik for wonderful learningðŸ’ðŸ’

12/26/2014 22:09: Participant 17: Thank you Pratik for the knowledge pack session full of learning

Thanks for your participation. I'll shortly publish transcript of group II discussion, possibly by tomorrow.

December 27, 2014

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