Can Employees Use Casual Leave on a National Holiday? Navigating a Legal Dilemma in HR

Recently, I have joined a company as an HR Executive, and I am solely handling all the HR Department responsibilities. The leave policies in this company are very chaotic due to the Labor Union. Recently, on 2nd October (a national holiday), we have a policy of triple pay on national holidays. However, the management decided to close some departments of the hotel for which they have no work on that day and instructed the employees to avail themselves of their national holiday. Due to some old staff members, an issue was raised as this had not happened in the last 25 years, and they came to the office. Now, this matter has escalated to a legal situation. Some staff members want to utilize their Casual Leave (CL) for 2nd October. Therefore, I would like to inquire if it is permissible to take CL on a national holiday?

Dear Raj,

There appears to be confusion about the fundamental concepts of types of leave and closed holidays. If you are from the hotel industry, then you must be covered under the Shops and Establishment Act. Please go through the Act applicable to your state and check whether definitions of these concepts are given in the Act itself. If not, please educate yourself and others on these concepts.

Acceptance of Change in Work Policy

In the instance you described, the issue is about acceptance of the change. All along, management had been calling the staff for work on National Holidays. Now, to maintain continuity, they called personnel from the Operations department for work and not other office staff. The change in decision from what was happening all along has incensed the workers, hence the dispute resulting from inertia.

Importance of Industrial Standing Orders

Do you have industrial standing approved by the labor department? If not, then first get these done immediately. Any decision taken under the provisions of the standing orders is unchallengeable in a court of law. Yes, theoretically the decision can be challenged, but then courts do not intervene if the decision complies with the standing orders. In fact, if your company has a labor union, especially an active one, then your management should have established standing orders long ago.

Casual Leave on National Holidays

On a national holiday, there is no question of availing casual leave. If labor asks for casual leave and if it is granted, labor is the loser of triple payment plus the loss of a day's leave. This in itself could create a problem.

Addressing Labor Union Challenges

You have one more challenge of how to loosen the stranglehold of the labor union. Try to come up with innovative ways to ensure that the union exists but is weak. In your hotel, the union appears to be militant. Talk to management and find out whether they are ready to launch a Voluntary Retirement Scheme (VRS) for the old-time workers who are also union members. It is these few persons who could be holding the entire business to ransom. The new generation employees are not so keen to be led by a labor union. In fact, in a lot of places, labor unions have become dormant, so it is surprising that it is still active in your company.

Thanks,

Dinesh V Divekar

Thank you for your opinion, Mr. Dinesh. I have very little experience in HR. Previously, I was working with a textile company where there were no such problems. This Labour Union is nervous about the management. Since this hotel is 27 years old and currently incurring losses, the management is not interested in continuing this business as the contract is expiring in 2017. The management is ignoring this and continuing as usual. The previous HR person also ignored the issues because he lacked HR knowledge. Since I joined, I have been trying to get everything in line. The union raises objections and sends letters to the company. This process wastes a lot of time, such as meeting with the hotel's legal advisor, drafting replies to the letters, and attending labor court dates. It's a mess here. There are no proper records of these agreements. I am learning day by day; it's only my second month here, but every week, new problems arise from this Labour Union.

It will not be treated like CL. In fact, it'll be treated as comp-off. You can give comp off. The second option for this matter is that you can contact your Local Assistant Labour Commissioner to seek an exemption for the same. Ask him for the procedure to do so.

Regards

Could you please confirm the CL & PL limit of the organization under the Factories Act and the Shop Establishment Act? Your earliest reply would be highly appreciated.

Regards,
Dillip

Provisions of employee leave vary in the Shops and Establishment Act or Factories Act from state to state. The variation is not major, but there is variation. Therefore, please follow the act applicable to your state.

Thanks,
Dinesh Divekar

Your workers' demand is correct. If you engage a worker on a National Holiday or Festival Holiday, as per the act, you should pay the double rate of wages and provide one day as a compensatory off. This law is specified in the Act, and you cannot escape from this procedure. If you require service from an employee on a National Holiday or festival holiday, you are obligated to pay the wages; otherwise, do not call them for work.

Since you mentioned that your workers have a Union, there should be an agreement with the Union by the Management. If not, please create the agreement by including all service conditions as per the laws. All agreements should adhere to the provisions of the Industrial Disputes Act.

Regards,
Adoni Suguresh
Sr. Executive (Pers, Admin & Ind. Rels) (Retired)
Labour Laws Consultant

No, it's not valid. You can give them Comp off and close the matter.

Regards