Leave Policy Template for Indian Companies (2025) — With Types, Days & Rules

Every Indian company — no matter how small — needs a written leave policy. Without one, leave approvals become a WhatsApp negotiation, employees feel treated unfairly, and you have no ground to stand on if a dispute arises.

Here's a complete leave policy template you can copy, adapt, and implement today.

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Types of Leave in India

Indian labor law and common practice recognize several types of leave. Some are legally mandated, others are industry standard but not strictly required.

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Leave Policy Template

Copy and adapt this for your organization.

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LEAVE POLICY — [COMPANY NAME]

Effective Date: [Date] | Version: 1.0 | Approved by: [Name, Designation]

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1. Casual Leave (CL)

• Entitlement: 8 days per calendar year
• Purpose: Personal errands, family events, short personal needs
• Rules:
  • Maximum 3 consecutive days allowed as CL; beyond that, Earned Leave applies
  • Cannot be clubbed with other leave types or public holidays without approval
  • Advance notice of at least 1 working day required (except emergencies)
  • Carry forward: Not allowed — lapses on December 31st
  • Encashment: Not applicable

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2. Sick Leave (SL)

• Entitlement: 8 days per calendar year
• Purpose: Personal illness or injury
• Rules:
  • Self-declaration acceptable for up to 2 consecutive days
  • Medical certificate required for 3 or more consecutive sick days
  • Advance notice not required (inform manager as early as possible)
  • Carry forward: Up to 4 unused days may be carried forward to the next year (max accumulation: 12 days)
  • Encashment: Not applicable

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3. Earned Leave / Privilege Leave (EL/PL)

• Entitlement: 18 days per calendar year (1.5 days per month worked)
• Accrual: Credited monthly; employees on probation accrue but cannot use until confirmation
• Rules:
  • Minimum 3 consecutive days per instance (EL is for planned vacations)
  • Prior approval required at least 5 working days in advance for up to 5 days; 10 days in advance for longer leave
  • Manager may defer leave during critical project periods — alternate dates will be offered
  • Carry forward: Up to 30 days can be carried forward to the next year
  • Encashment: Unused EL beyond 30 days will be encashed at the time of annual appraisal or at separation

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4. Maternity Leave

• Entitlement: 26 weeks (for first 2 children); 12 weeks (third child onwards)
• Pre-delivery: Up to 8 weeks before expected delivery date
• Eligibility: Employees who have worked for at least 80 days in the past 12 months
• Pay: Full pay during maternity leave (as per the Maternity Benefit Act, 1961)
• Miscarriage/medical termination: 6 weeks of paid leave
• Work from home: May be extended post-maternity on mutual agreement with the manager
• Nursing breaks: Two 15-minute breaks per day for up to 15 months after delivery

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5. Paternity Leave

• Entitlement: 10 days per child (up to 2 children)
• When to take: Within 3 months of the child's birth or adoption
• Pay: Full pay
• Notice: At least 1 week in advance where possible

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6. Bereavement Leave

• Entitlement: 5 days per instance
• Eligible relations: Spouse, child, parent, sibling, parent-in-law
• Rules:
  • Additional leave can be availed as Earned Leave or Leave Without Pay
  • Documentation may be requested in sensitive cases

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7. Public Holidays

• Entitlement: 10 mandatory national/state holidays per year
• The company will publish the holiday list for each calendar year by December 31st of the previous year
• Optional holidays: 2 days — employees may choose from a list of 5 published holidays

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8. Compensatory Off (Comp-Off)

• Applicable when an employee is required to work on a declared holiday or weekend
• Must be availed within 60 days of being earned — lapses after that
• Requires prior approval from the manager before working on a holiday/weekend

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9. Leave Without Pay (LWP)

• Applicable when all paid leave balances are exhausted
• Requires manager and HR approval
• Salary deducted on a pro-rata basis for LWP days
• Extended LWP (more than 30 days) requires written approval from the management and may affect annual appraisal

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10. Leave During Notice Period

• No paid leave (except SL with medical certificate) will be approved during the notice period
• Any leave taken during the notice period will extend the notice period by an equivalent number of days, or be adjusted from Full & Final Settlement

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11. Sandwich Rule

If an employee takes leave on days immediately before and after a public holiday or weekend, the intervening non-working days are also counted as leave.

Example: Leave on Friday + Saturday–Sunday (weekend) + Leave on Monday = 4 days leave deducted, not 2.

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12. Leave Application Process

1. Apply on the HR portal (JambaHR) at least [X] days in advance
2. Manager approves or requests a date change within 2 working days
3. Auto-confirmation sent via email once approved
4. For emergencies, inform your manager by call/message and apply on portal retroactively within 24 hours

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Legal Compliance Notes

Shops & Establishments Act

Each state has its own version. Key requirements for IT/office-based companies:

• Maharashtra: 21 days EL/year; 8 days CL; 8 days SL
• Karnataka: 15 days EL/year after 12 months of service
• Delhi: 15 days EL; 12 days CL; 12 days SL

Always check the specific Act for the state where your registered office is located.

Factories Act (for manufacturing)

• Workers are entitled to 1 day EL for every 20 days worked
• Minimum 240 working days required to qualify for EL in a year

Maternity Benefit Act, 1961 (amended 2017)

• Mandatory for all establishments with 10 or more employees
• 26 weeks applies for first two deliveries only
• Creche facility mandatory for organizations with 50+ employees

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Implementing This Policy

A written policy is step one. Enforcing it consistently is what builds trust. Common problems companies face:

• No central tracking — leave is managed on WhatsApp, email, or spreadsheets. Approvals are inconsistent.
• No balance visibility — employees don't know how many days they have left until they ask HR
• Manual payroll adjustment — LWP days have to be manually counted and deducted each month

JambaHR automates all of this — employees apply for leave from their dashboard, managers approve with one click, balances update automatically, and LWP days flow directly into payroll.

Set up your leave policy in JambaHR for free →