Navigating Reduced Workweeks: How Should Companies Handle Employee Absences Legally?

Hi HR Friends, As all are aware, there is a recession in the market, especially in the manufacturing sector. I have a query here. Suppose a company has fewer orders, so it wants to run its plant for, say, only 4 days or 3 days a week and give off for the remaining days of the week. In this case, I want to know what is the best option: whether to mark the employees as absent or to mark them as leaves (paid leaves). And if we are marking them absent, is it acceptable legally? Also, I want to know generally what other companies are doing in this regard. Eagerly waiting for replies and thanks in advance.

Regards,
Rajeev Dixit

If the employees are on a casual basis, you can mark them as absent for the second query related to paid leave or absence. I think you may consider the third option, which we also implemented when our company was going through a recession. You could opt for a 50-50 approach where half of the paid leave will be deducted from the employee, and the other half will be covered by the employer. This strategy will boost employee morale and encourage them to work more effectively.

Hope this helps you.

You can completely cut down on casual labor and work with on-roll employees. If possible, you can operate for 6 days by running the plant with only one shift, which can help avoid the paid leave option (only for on-roll employees). You could also consider discussing with some employees the possibility of taking long leaves to address any production shortages.

I just want to understand how the operations will run for 4 to 3 days. If this change is long-term, we need to handle it very carefully.

Another option could be to deduct the leaves of employees for 2 weeks in a month, with the plant closed for 3 or 2 days during that period, and the company paying salaries for the days the plant is closed. For employees who may run short of leaves or have no leave available, the company will need to bear the responsibility and make the full payment.

I also agree with Mr. Shambhunath Singh's views.