Hello Satya,

1. EL encashment @ basic salary is not legal. It should be on basic salary + DA + all other allowances payable as per the terms of employment. Definition of wages is not same in different Acts and in some definitions, bonus, overtime, etc are also the part of wages but in other definition these are not. But from all definitions, one thing is clear that mere basic salary can not be considered as wages for EL encashment. You may howver, exclude bonus, overtime payment, profit sharing, house rent reimbursement, etc from the wages while computing EL encashment.

2. You also need to check number of EL entitlement in factory Act and Shop & Establishment Act, as applicable in your case. 12 nos EL are in any case less than minimum EL entitlement.

3. Maternity leave are with full wages and benefits. Hence, no deduction in wages during the maternity leave can be made.

Regards,

Dr Ajay Arya