Carry-forward and encashment policy
Rules for unused leave at year end and on exit.
Carry-forward and encashment policy
LEAVE CARRY-FORWARD AND ENCASHMENT - [Company name] 1. Carry forward: Up to [number] days of earned leave carry into the next year. Casual and sick leave lapse at year end unless stated. 2. Maximum balance: The earned leave balance cannot exceed [number] days. 3. Encashment during service: [Allowed once a year for up to [number] days / not allowed]. 4. Encashment on exit: Unused earned leave up to [number] days is paid with the final settlement, at [basic / basic plus DA] per day. 5. Calculation: Monthly pay divided by [26 / 30 / number of days in the month]. 6. Tax: Tax treatment follows the law in force. Payments are shown on the payslip. 7. Disputes: Raise with HR within [number] days of the settlement.
Replace everything in [square brackets]. This is a starting point and not legal advice. Have your adviser review it.
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