HR Leave Policy Changes: How Should Managers Handle Disagreements with Management?

Dear Seniors, this is regarding my disagreement with the management. I am working in a manufacturing company as Manager-HR. In the year 2017, I introduced a leave policy where employees are entitled to get 6 Casual Leave (CL), 6 Sick Leave (SL), and 18 Earned Leave (EL). I have prepared this policy, which is a normal practice in the industry. However, after 6 months of the implementation of this policy, management wants to amend the policy as follows:

1. EL can only be approved by MD/Director.

My Opinion: The reporting authority should approve it because they can better understand the employee's needs. We should not bypass the system. Furthermore, I don't want the MD/Director to spend their valuable time on this (for 150 employees).

2. If CL is not available, then the employee cannot take EL for 1 or 2 days.

My Opinion: If an employee has availed all CL from their entitlement quota, then their leave can be approved as EL. Treating it as LOP may lead to employee dissatisfaction.

3. Management discourages availing EL. They want employees to encash their leave at the time of separation.

My Opinion: Neither should it be discouraged nor encouraged. If an employee cannot avail EL from their quota, then what is the point of keeping 18 ELs per year, as it also increases the company's liability. Because encashing leave will be calculated on gross salary.

For example, for my sister's marriage, I cannot take EL from my quota; it will be treated as LOP and encashed at the time of separation. It can only be approved at the discretion of MD/Director, not by policy. For every such type of leave, HR/Site In-charge/RCM will follow up with management to get it approved on behalf of the employee.

4. HR will send the Leave approval copy to the finance department for verification.

My opinion: It increases administrative work, and why should the HR department send HR data to another department? Payroll includes all data like paydays, leave balance, etc.

5. EL has to be sanctioned at least 7 days before availing the same.

My opinion: Prior approval is required, but 7 days is a long time for 2-3 days of leave. In the case of leave more than 7 days, then it should be okay.

Furthermore, I want to inform you that I am not feeling comfortable with this policy, and I may be wrong as well. Therefore, I need your valuable suggestions in this regard. I have taken one day from management to share my feedback.

I shall be happy to provide additional information if required.

Thank you.

Dear Jitendra,

Following are my observations on your post:

a) Overall, your concerns are genuine. Any other HR professional in your place would agree with your views.

b) By granting 30 days of leave per annum, your company is liberal as far as employee leave is concerned. However, the spirit of this liberalism is undermined by imposing too many restrictions.

c) Overall, your management views employee leave as a nuisance or necessary evil. In general, their tendency is to move towards centralization from decentralization.

d) The reason for (c) above could lie somewhere. In general management practice, there could be too much centralization. Now, employee leave is also brought under the ambit of centralization.

General comments: You may suggest to your management to conduct a survey of the general business environment. A business cannot grow unless employee motivation is maintained. If they were that strict, they should not have allowed you to proceed with your leave policy. Changing the leave policy just after six months shows inconsistency. As per the law, for every 20 days of attendance, an employee becomes eligible for 1 day of leave. With this formula, an employee becomes eligible for 15 days of leave per annum. Your management is fulfilling this legal requirement only and nothing else. However, while doing so, they can give freedom to the HODs and the employees.

Lastly, inform your management that some IT companies have adopted a different approach. There is no categorization of leave at all, and there are no restrictions on the number of days of leave either. All that is required is to meet the deliverables. However, the performance targets are set so high that employees work hard to achieve them. Therefore, your management needs to shift focus from managing people to managing results.

Solution: If you say anything, they may not listen to you. Overall, their haughtiness is quite apparent. Given this context, you may suggest discussing this type of leave arrangement with a senior HR consultant. They can examine HR practices within and outside the industry. Otherwise, changing the attitude of self-obsessed individuals is always challenging.

Thanks,

Dinesh Divekar

Dear Mr. Dinesh Devekar, I was really expecting your suggestion and, as always, you have given excellent feedback and shown the reality of the industry of our type. But as an HR professional, I don't want to adopt any policy halfheartedly. I will definitely try to convince them as suggested by you. I am sure this policy may cause enough employee issues in the coming days. Then again, it will be my responsibility to handle their dissatisfaction in the line of management where HR himself is not convinced.

Thank you very much for your valuable feedback, comments, and solutions.

Hi Jitendra, really nice views and opinions you have there. A policy has to be fully supported by the management. I have almost the same case but not to a point where our management has to intervene or supervise out of the chain of command. Just some questions: What is the reason why the MD decided to be the one to approve EL? Were there specific data that show more people are taking EL than CL? My view here is that we should do a data analysis for the past 6 months to show data records of how many have applied/approved for EL and CL. Then, compare these leaves to the previous 6 months prior to your leave policy approval. We hope that data may be helpful. Additionally, analyze the pros and cons of the 5 points you mentioned and present them to your superior to enlighten the MD. Your honorable MD's time is more valuable than just signing the leave forms. 

Regards,

Shallohal
Bangladesh

Dear Jitendra,

If you are working in the factory, please refer to the Factories Act Sections 78 to 84. These sections will provide you with details about earned leave.

If you are working in an establishment that is not a factory, please refer to the Shops & Establishments Act as it contains information about leaves.

Whatever you are proposing is, in fact, correct and practical.

Regards,
Bharat Gera
HR Consultant

Dear Jitendra, further to the expert views given above, it is a typical case of mindset! In this age of globalization and internet connectivity, it is high time to realize that the whole focus should be on results rather than on physical presence in the office. According to a Gallup study, companies have only 30% fully engaged employees. Therefore, employers must strive to create an environment where this percentage of engaged employees increases. Employees should be encouraged to take leave, disconnect from work, and come back refreshed to work.

However, one piece of advice: Do not encourage taking EL in small numbers of 1 or 2 days as it leads to disruption at work. EL should be availed in a block of at least 7 days at one time.

Regards, Anil Raina

[Phone Number Removed For Privacy-Reasons]

On a practical ground, let me write it very clearly here that HR is also an employee hired by management to support the business thinking and plan. Often when HR is hired at some senior level, management shows very enthusiastic behavior towards bringing in change and improving the system.

With the passage of time, when HR suggests a load of compliances to be maintained, which actually leads to a rise in the cost and budget of the company, the actual picture gets highlighted. Management these days is more concerned with meeting compliance and keeping costs low. From reading your above points, I gather that your management is of a traditional nature, smartly securing themselves by making/amending policies to ensure minimal advantage passes on to the employee.

Believe me, if you have spoken to them previously, then trying again with traditional-style people will not yield more results. My smart suggestion is to follow the instructions given to you. I know it is difficult, but that is the harsh reality of the corporate sector. Insisting repeatedly on discussions management does not want to engage in will only leave an unfavorable impression. Keeping costs low is the main motto of management these days.

Dear Jitendra,

My observations on your post:

Your company is generating 30 Annual Leave days, but according to leave laws, any employee must have a monthly attendance of twenty days to be allowed 1.25 days of Earned Leave (EL) per month, totaling 15 days annually. This leave can be used in any case. All department employees' leave approvals are authorized by the Head of Department (HOD); however, some key persons have leave approval rights with the Managing Director (MD).

Thank you.