Leave Policy for different sectors in India

More on Leave Policy in India

High Court allows paternity leave in private schools

Earned leaves encashed are now not liable for Provident Fund deductions

Pension, paid leave and maternity benefits now extended to domestic workers

Earned leave encashed at retirement is exempt from tax up to a maximum of Rs 3 lakh

Working on National Holidays

What do you know about Leave Policy at Work in India? Find out information about holiday rights, annual leave laws, annual leave per year, leave policy at workplace and pay etc.

What is the general leave policy in India? How many days Earned Leave (EL), Casual Leave (CL) and Sick Leave is one entitled to per year? These questions are often asked by employees/workers working in any organisation or office. Leave is different from holidays and days-off, since it aims to fulfil different objectives of work life sphere. However, there is always a confusion how much leave can one avail, what is one legally entitled to, the consequence of the same on wages/salary etc.

Employment laws set the umbrella framework for deciding different dimensions of leave, like category or types, eligibility, duration etc. Many companies and organizations categorise leaves in different categories like casual leave, sick leave, earned leave, maternity leave, special leaves, loss of pay leave, compensatory leave etc.

In case of employment contacts, where trade unions are involved in deciding employment contacts, leave rules are formulated in consultation with the unions. Such elaborate consultation is specified in The Industrial Employment Standing Orders Act which is formed for enforcement of different conditions of services.

In India, three types of leaves are generally followed namely earned leave, sick leave and casual leave. Different provisions exist under different laws, for different categories of leaves.

Details of each category are elaborated hereunder. While the Act specifies the broad framework, the notified rules under each legislation detail the implementation or applicability of these leave policies.

Quarantine Leave

This leave is usually granted to a concerned employee by reason of presence of an infectious disease in the family or household of the employee, if such disease is considered to be hazardous to the health of other people.

Working Journalist and Other News Paper Employee’s (Conditions of Service) and Miscellaneous Provisions Act, 1955 - Rule 3028

Maximum 30 days of quarantine leave can be availed by the employees covered under this Act.

Sales Promotion Employees (Conditions of Service) Act, 1976 - Rule 1629

An employee covered under this Act can avail maximum 30 days of quarantine leave on recommendations by authorized Medical Attendant or Public Health Officer.

Extraordinary Leave

Working Journalist and Other News Paper Employee’s (Conditions of Service) and Miscellaneous Provisions Act, 1955

Rule 3130

Extraordinary leave without wages may be granted to employees covered under this Act, by the newspaper establishment in which he is employed.

Sales Promotion Employees (Conditions of Service) Act, 1976

A sales promotion employee may be granted extraordinary leave without wages at the discretion of the employer in special circumstances.

Apprentices Act, 1961 - Section 1531

An apprentice can avail extraordinary leave upto a maximum period of 10 days in a year.

Study Leave/Sabbatical Leave

Study leave/sabbatical leave is granted to an employee to pursue higher studies with a guarantee to resume them in job on completion of the leave. Such leaves are granted to an employee in accordance with company policies and may be paid or unpaid sabbatical leave. The sabbatical leave would be exclusively for scientific or academic work at any relevant institution in India or abroad. The facility of sabbatical leave may be extended to include work on other activities of the innovation chain with industry, consultancy organizations, financial institutions, project engineering firms, technology marketing/transfer agencies, etc.

Working Journalist and Other News Paper Employee’s (Conditions of Service) and Miscellaneous Provisions Act, 1955

Rule 33

The Rule provides for grant of study leave with or without wages at discretion of the employer.

Sales Promotion Employees (Conditions of Service) Act, 1976

Any employee covered under the Act may be granted study leave with or without wages in accordance with the company policies.

Leave Not Due

Where an employee has no leave to his credit and he/she still requires leave, such leave may be granted at the discretion of the employer.

Working Journalist and Other News Paper Employee’s (Conditions of Service) and Miscellaneous Provisions Act, 1955 - Rule 3233

A working journalist who has no leave to his credit may be granted leave at the discretion of the newspaper establishment in which such working journalist is employed.

Sales Promotion Employees (Conditions of Service) Act, 1976

A sales promotion employee, who has no leave to his credit, may be granted leave not due at the discretion of the employer.

Leave For General/Bye Election For Parliament And State Assemblies34

During the general elections in the country or the state where the employee is residing he is eligible for leave on the polling day. For general elections of Lok Sabha and Vidhan Sabha or any of the bye election one day leave is been declared to all employees for the polling day. (Sec.3A of Karnataka Industrial Establishments (National and Festival Holidays) Act, 1963)35

Under Industries Association Act, 1963 Section 3 (A) also there is a provision for such leave.

For Central Government employees provision for such leave differs for each election details of which can be checked as under given table36 :

II. Bye-Elections -
(i) Lok Sabha

II. (a) Holiday/Closure of offices State Government normally declares a local holiday in that particular area/constituency on the polling day (s) if the election is held on day (s) other than Sunday/or other closed holidays. Central Government offices may also follow the State practice in such cases.

(b) Grant of Special Casual Leave-
Permissible on the same grounds/circumstances as in the case of general elections [of I(b) above.]

(ii) State Assemblies

(a) Holiday/closure of offices- In bye-election to State Assemblies, Central Government offices should not be closed. It would be sufficient if only those Central Government employees who may be placed on election duty are permitted to absent themselves from office on the polling day (s). All other employees should be given facility to excise their franchise either by way of coming late to office or by being allowed to leave office early or a short absence on that day, subject to the exigencies of the services.

(b) Grant of Special Casual Leave- Permissible on the grounds/circumstances as in the case of general elections. (of I(b) above.)

III.Panchayat/Corporation. /Municipalities or other- local bodies

III. The Central Government-offices shall not be closed. The Government employees who are bonfire voters and desire to exercise their franchise should however, offered reasonable facility, subject to the normal exigencies of service, either by way of coming late to office or by being allowed to leave office early or a short absence on that day.

Innovative Leave

Human Resource department of every company deals with employees and to maintain a healthy and friendly relation with them. They work as a bridge between employees and management. As the competition in the labour market is high to find and retain skilled employees HR department of various companies other than the legal leaves also are coming up with various innovative leaves. Some of the examples of these leaves adopted by different companies to provide benefit to their employees are as follows:

Bereavement Leave37

This leave is a grant paid time off from work to employees for the death of a relative. Employees are eligible for up to 7 days leave, if necessary, in the event of the death of an immediate family member (defined as parents, grandparents, siblings, spouse, children and in-laws). This leave is generally provided for the demise of close relative, and depends on the policies framed by the organisation. This leave is not legally entitled but is an innovative approach of HR policies in some of the private firms.

Birthday Leave38

In Bharti Airtel company a half day leave is been provided to the employee for the celebration of Birthday.

Employee Volunteering Leave39

Employee volunteering leave is a leave been granted to an employee to participate in volunteer for a charity. Bharti Airtel Company provides one day paid leave to its employee for volunteering work.


It has been officially announced that men working in private schools in the capital are entitled to paternity leave. The Delhi Government filed its reply before the Delhi High Court stating that all unaided recognized schools are under the purview of the Directorate of Education and the rules applicable to them are same as those applicable to government schools. 

Six months ago Chandramohan Jain, a private school teacher moved the High Court, as he challenged deduction from his salary for the period when he was on paternity leave. He submitted that the Delhi Education Act and rules provided that the staff of unaided public schools would be eligible to salary, allowances, leave and other benefits equivalent to their counterparts in government schools. 

Justice Sunil Gaur allowing his petition declared that the male employees of unaided recognized private schools were entitled to paternity leave.


March 12, 2008 onwards no Provident Fund deductions can be made from the amount received by an employee by encashing the earned leave. This is because earned leaves that are encashed do not constitute a part of ‘basic wages’ under Section 2(b) of the Employees’ Provident fund and Miscellaneous Provisions Act, 1952.

The Employees’ Provident Fund Organization has also directed through a circular directed to discontinue PF deductions on such earned leave encashments with immediate effect. Further, it has clarified that if any payment has been already made in respect of the same, it can be adjusted for future liabilities and no refund can be claimed from the same.


With the passing of the Domestic workers (Registration, social security and welfare) Act 2008 every registered Domestic Worker is now slated to receive pension, maternity benefits and paid leave that is a paid weekly off.

The benefits conferred here include constitution of a Domestic Workers Welfare Board consisting of representatives from middle class, domestic workers and the government. Also it provided for fixation of Minimum hourly wages by the board which may differ from city to city. A grievance redressal machinery has also been set up.


The earned leave encashed during service is fully taxable as salary income in the hands of the employee but earned leave encashment at retirement is eligible for tax concessions. When you retire, the total amount of earned leave will be calculated by taking 30 days earned leave for every year of completed service multiplied by the total service period. The average of the last 10 months salary is taken in to account for calculation. The amount of leave encashed during the service period will be deducted from the total leave calculated on the basis of number of years served. For instance, if a person has worked for 20 years, he can encash leave for 600 days ( 30 days for every year multiplied by 20 years). Suppose, out of this, he has already encashed 200 days during his service period. So, he an encash only 400 days of earned leave on retirement. The amount calculated as above is tax-free up to a maximum amount of Rs. 3 Lakh.


Republic Day (January 26), Independence Day (August 15) and Gandhi Jayanti (October 2) are the three national holidays observed in India. On these days all institutions, irrespective of under which law they are covered, or whether they are public or private organizations or MNCs should necessarily remain closed.

But if for some reasons, on these national holidays if the employers wish to keep their organization functional, they need to obtain prior permission from concerned authorities. Also, the workers who work in organization on these national holidays are entitled to receive double wages for the day. (Though these national holidays are a matter of Central legislature, some states do have made provisions for compensatory leave to the workers who have worked on these national holidays, and this is over and above double wages for that day.)