Annual Leave Encashment
Dear HR Professionals,
I would like to know what is the policy in your organisation to encash annual leave for existing staff end of the year if they could not clear their leave due to business needs?
We allow employees to carry forward maximum one year earned leave to next year, to be consumed by the end of June next year.
HR will need to confirm as follows;
1. Immediate superior of the staff will need to confirm if the business travel was part of the travel plan or ad-hoc.
2. HR will review staff leave pattern to see if the staff has been planning and taking his leave throughout the year or due to poor planning, has accumulated his leave thus not able to clear by end year.
Our company has staff who travel frequently as part of their job however as our policy does not allow encashment of annual leave, the staff has been discipline in clearing their leave and we do not face such a situation.
We extend the deadline to clear leave by 31 Dec to 30 June next year due to business needs. As far as possible, we do not encash leave unless the staff has resigned and is leaving. We feel encashing leave discourages people from taking leave and getting the needed rest.
If it's due to business needs that employees are unable to clear annual leave, encashment is usually supported. The rate for encashing AL is (basic pay*12) /(no. of working day per week*52)*no of days to be encashed.