Leave management has always been one of the biggest nightmares of HR professionals. While employees are entitled to leave, the frequency and the time of applying for leave scare the HR team as they have to ensure alternative options to avoid any disruptions to organizational productivity. However, if you have the right leave management policies supported by an advanced employee leave management system, things can be pretty light and less of a headache. In this comprehensive leave management guide for HR professionals, you will learn about the basics of leave management and how to handle it both effectively and without causing strain to your peace of mind.

Employee Leave Management: What Is It?

The first step to understanding what is leave management is to define what is leave. Leave is a time an employee takes away from work. Every organisation, as per the law, is required to provide their employees with a certain number of leaves every year, in addition to the weekly holidays. Paid leaves are part of the benefit schemes promised to the employees in the work contract when they join a company. The employees, before taking these leaves, are required to inform the management about the time off in advance so that the latter can make alternative arrangements in the schedules to keep the workflow. So, leave management is all about the process of managing the leaves effectively. Both the employees and the employers play a key role in ensuring effective leave management in organizations.

Why Is Leave Management Important In Every Organization?

We saw that leave management is essential to keep the business running. But is that the only reason? Let’s explore the other reasons underlying the importance of HR leave management.

For effective project management

Project managers are required to know how much time each employee spends on a project. Assuming that all employees will be present on all days and when someone doesn’t show up on certain days, it can affect the project’s completion.

For error-free payroll processing

Having an accurate time off tracker is essential for error-free payroll processing. Miscalculations can either lead to overpaying or underpaying the employees. In either case, it will add up to a headache for the HR team when corrections are to be made.

For accurate record-keeping

You can’t ensure the compliance of your leave policies without having the analytics of employee leaves. Unhappiness among employees is often a result of a lack of transparency regarding the leave policy. If there is a proper employee leave management system that tracks employee leaves in real-time and keeps them up-to-date on their balances, the employer can ensure that the leave policies are in effect and there is no room for any dispute with the employees.

To ensure statutory compliance

There are specific leave laws in every Indian state. Employers operating in a certain state are required to comply with the respective laws applicable in the state to evade any legal penalties. The best way to prove that your organization comply with the laws is to produce solid data regarding your employee's paid leave usage, for which an effective leave management program is essential.

Types Of Leaves Available For Employees To Use

Companies offer a certain number of leaves to their employees each year which they can avail through HRMS leave application. The number and type vary from company to company and state to state. The common types of paid leaves are discussed below:

Earned Leaves: Earned leaves (EL) are also called privileged leave (PL) or annual leave (AL). It is a planned holiday that employees who have completed working for a certain duration deserve to enjoy. As such new employees have to complete working a certain number of months before becoming eligible for earned leave.

Casual leave: Casual leave is the most common type of leave offered to employees across companies in India. It allows the employees to meet unforeseen situations. For instance, maintenance work at home, or the visit of a surprise guest.

Sick leave: When your employees fall sick, they can utilise their sick leaves (SL), also known as medical leaves (ML). When sick leaves are taken for more than two days, companies might ask the employees to produce a medical certificate to prove their health condition.

Maternity leave: As per the Maternity Benefit Act of 1961, employers must grant paid maternity leave of up to 26 weeks to female employees who have completed at least 80 days of work in the preceding 12 months before the expected delivery date.

Paternity leave: Paternity leave is for fathers of a newborn child to be with the mother and the baby. Although companies in India are not mandated to offer such leaves, there are several companies in the country that have added it to their leave policy.

Travel Leave: Some companies offer travel leave for employees, whether for work-related trips or personal reasons. These leaves promote a healthy work-life balance by accommodating employees' travel needs.

Optional Holiday: An optional holiday allows employees to take a day off based on personal significance, while the office operates as usual. In culturally diverse countries like India, this fosters inclusivity by honouring individual traditions and beliefs.

Work-from-home days: Although not necessarily a leave type, it is an employee-friendly leave policy that many companies follow these days. As per this, employees can work from home for a few days each year when it's difficult for them to come to the office for one or the other reasons.

Marriage leave: Although a statutory requirement by law in India, a growing number of companies in India provide from a minimum of three days to a maximum of ten days paid leave to their employees who are getting married.

Compensatory off: Some companies ask their employees to work on a weekend or overtime on weekdays to avoid missing deadlines. In such cases, they would offer a compensatory-off to their employees. The employees can either use them or encash them.

Loss of Pay: In case the employee has used up all the leaves but still requires leave, they can avail of leave without pay (LWP) or Loss of Pay (LOP). In most companies in India, leave taken without proper leave approval channels, even when the employee has sufficient leave balances, is effective for a Loss of Pay.

Tips for Efficient Leave Management

The following tips will help you handle leave management efficiently at your workplace.

Create a leave management policy:

Leave management begins with a leave policy. Formulate a flexible and rational leave policy for your team ensuring that their basic personal needs and work-life balance are met through the number of leaves. Put the leave policy in simple terms and make it accessible to the whole team through the attendance leave management system.

Know the statutory requirements:

Non-adherence to statutory leave requirements will cause your company to be in a bad light. So, ensure that your leave policies comply with the state or federal leave laws applicable.

Bring transparency and consistency:

Once you have the attendance & leave management policy ready, it is important to ensure its fair and transparent implementation across teams and employees. No one should be left to feel unjustly treated contrary to the leave policy.

Switch to an online leave management system:

Having effective software for leave management helps deal with most of the challenges associated with it. Today, there are hrms online leave management applications that seamlessly integrate automation and AI-powered features to help you ease leave management woes and bring maximum accuracy to the process.

Conclusion

Ensuring accurate leave management for your employees is not just a legal requirement but essential for effective workforce management. Leaves significantly impact both individual productivity and overall team morale. We hope this blog answers all your questions about leave management and guides you in implementing an effective process at work. At Mewurk, we pioneer a modern employee leave management system with advanced features that can streamline leave management and payroll processing to less than ten minutes. Want to learn how? Try our Early Access Program for free by registering now.