- Maharashtra’s Shops and Establishments Act, 2017 gives 8 days of casual leave with wages each calendar year.
- The leave is credited every quarter, so roughly 2 days arrive each quarter.
- Unused casual leave lapses on 31 December. It does not carry forward or encash.
- Other states set different numbers, so a multi-city team needs a state-by-state check.
On this page
What does casual leave mean for an Indian employer?
It’s the leave type for the unplanned day. Most policies cap a single spell at two or three days and ask for notice where possible.
The casual leave meaning differs from earned leave in three ways:
| Feature | Casual leave | Earned leave |
|---|---|---|
| Source of the right | State Shops and Establishments Act | OSH Code and state Act |
| How it accrues | Fixed credit (8 days in Maharashtra) | By days worked (1 per 20) |
| Carry-forward | None, lapses at year-end | Yes, up to a cap |
| Encashment on exit | No | Yes |
Section 18(2) of the Maharashtra Act sets the quarterly credit and the year-end lapse. The Act’s leave section on LawGist reproduces the text.
How are casual leave rules applied in practice?
Credit, cap and lapse. That’s the cycle.
Suppose a Pune employee joins on 1 April. Under a quarterly credit, she gets about 2 days for April to June, 2 for July to September and 2 for October to December. That’s around 6 days in her first year, and nothing survives into January.
| Quarter | CL credited | Carried to next year |
|---|---|---|
| April to June | 2 | No |
| July to September | 2 | No |
| October to December | 2 | No |
Here’s a trap. Some foreign employers fold CL into a single “paid time off” pot that rolls over. That’s legal only if the pot gives at least the statutory casual days and earned leave on top. Track the components separately in your attendance and leave management system.
Also watch mass absence. Under the Industrial Relations Code, concerted casual leave by more than half the workers on one day counts as a strike.
Does casual leave cover illness?
Often, in practice. Many Indian employees use CL for a one-day fever.
That said, you shouldn’t rely on it. Where your state or policy provides sick leave, keep it as a separate balance. The two serve different needs, and our article on simplifying leave policies explains how to set both.
How does Remunance manage casual leave for your India team?
Remunance applies the casual leave rules of each employee’s state, credits balances on schedule and keeps the registers the Shops and Establishments Act requires. We do this as the employer of record for teams across 34 Indian cities, so a Pune hire and a Chennai hire each get their own state’s minimum. To align your global PTO policy with Indian law, get a leave policy check from our team.
What else do people ask about casual leave?
How many casual leaves are allowed in a year in India?
It depends on the state. Maharashtra gives 8 days a year. Your policy can give more, but not less.
Can casual leave be carried forward?
Not in Maharashtra. Unused casual leave lapses at the end of the calendar year.
Is casual leave paid on resignation?
No. Casual leave isn’t encashable on exit in Maharashtra. Only earned leave is paid out.
Planning a hire in India?
Our founding team has run payroll and hiring in India for 22+ years, first as Remunance Systems, which was later acquired by ADP.