Karnataka HC: An Employee Is Entitled To Earned Leave Only If He Works


Earned leave is a privilege a workman would be entitled to only if he actually works & can’t be earned as a matter of right if he hasn’t worked. The Karnataka HC made this observation while upholding the contention put forward by Vijaya Bank in connection with one of its reinstated employees.

“If he doesn’t work, he’s not entitled to it. Hence, earned leave, unless the relevant regulations expressly specify otherwise, can’t be considered a consequential benefit,” a division bench comprising Justices Ravi Malimath & MI Arun observed. The bench also opined that night shift/travel allowance would also accrue only if the person works.

According to Times of India Reports, Vijaya Bank had challenged the single bench order dated Nov 3, 2016, wherein it was directed to allow HC Jayaprakash, a retired bank employee, to encash 240 days’ salary as earned leave.

About 14 years ago, Jayaprakash was removed from service. He challenged the same. The matter reached the HC. Jayaprakash succeeded & was ordered to be reinstated in service with full back wages & consequential benefits. However, before a division bench, the back wages were reduced to 60% on the grounds that it would put financial burden on the bank.

Though Vijaya Bank settled other dues, it didn’t permit him to encash 240 days of earned leave. Jayaprakash moved the Central Govt Industrial Tribunal under the Industrial Disputes Act, 1947. It ruled against him saying he’s not entitled to earned leave. He then moved the High Court again. A single bench, which heard Jaya prakash’s plea, ruled that he’s entitled to earned leave as he wasn’t held guilty in the disciplinary proceedings. However, there was no finding given as to whether earned leave is part of consequential benefits.

Vijaya Bank challenged the order before a division bench, contending many Supreme Court & High Court decisions say a reinstated employee is not entitled to allowances which would accrue only if he worked in conditions entitling him to draw them.

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