One Month means 30/31 days while calculating Retrenchment Compensation, Ex Gratia and Earned leave wages

There exist a general confusion regarding number of days that needs to be reckoned for a month, while calculating benefits like retrenchment compensation (under Section 25-F of ID Act), Ex gratia, Earned Leave Wages etc (under Long Term Settlement). These confusions arise from the fact that Payment of Gratuity Act was specifically amended to state that one month means 26 days. But that concept is confined to the dominion of Gratuity alone and is not extended to Industrial Disputes Act or Settlements enforceable under it.

In a recent decision of the Madras High Court in TANSI v. Labour Court [2010 II LLJ 107 (MAD)], it was held that there is no justification for import of concept of ’26 working days’ into ID Act where no amendment has been made in line with language employed in Payment of Gratuity Act.

That being so, one month means 30/31 days for calculating all labour benefits/emoluments except for Gratuity payable under Payment of Gratuity Act.


About Thomas Geeverghese

Vayaliparambil, Perumbavoor | Advocate, Ernakulam
This entry was posted in Earned Leave Wages, Ex Gratia and tagged , , , , , , . Bookmark the permalink.


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