Confirmation Date Changes: Is Issuing Letters on the Exact Day a Good Move?

Dear Friends,

I am in an organization that is following a particular trend of having the confirmation date altered in such a manner where the letter is issued either at the beginning of a month or at the end of the month. I have plans to change the same. I am planning to ask my department to issue letters on the respective day itself. Am I doing the right thing? Will it affect any other details like leave, LTA, gratuity, etc.? Please do advice.

Regards,
Annie

Confirmation date of an employee is governed by the terms and conditions of employment laid down in the letter of appointment. The same is agreed to and accepted by the employee. It is also binding upon the employer to adhere to the date of confirmation as provided in the letter of employment/appointment. Hence, it is mandatory to confirm the employee from the said date; provided the criteria laid down for confirmation are fulfilled by the employee to the employer's satisfaction.

One of the situations where the confirmation date can be changed is when the probation is extended either for reasons of performance or if the employee does not complete the required months of probation due to ill health/accident, etc. There too, a letter stating that the probation is extended until such and such date is mandated.

As for the issuance of letters, the same can be done at the end of the month in which the probation is being closed, as long as the date of confirmation is maintained.

Regards,
mxsingh

Dear Singh/Annie,

I join Singh in his analysis of the situation. The issue is not the date of issue of the confirmation letter but the effective date of confirmation; it has to strictly conform to the offer of appointment issued by you and accepted by the employee. Although a couple of weeks extending the probation does not make much of a material difference, it has legal implications. The argument that the organization has been shifting the confirmation date to the month end may not be appealing to the judiciary. If, as an organizational practice, you want to regulate the date, mention so clearly in your offer of appointment. Unless there are cogent reasons about performance or conduct, the legal position is clear that the probation cannot be extended. I hope my views are useful.

Dear Singh / the gentleman whose name I could not see,

Thank you for the valuable information. However, I still want to know if changing the present system will cause any changes in matters such as LTA, leave encashment, gratuity, etc.

Regards,
Annie

"Annie"

What you have done is in order. Any employee recruited to various posts will be on probation for a fixed period. Confirmation of an employee is subject to his/her satisfactory service reports. At the end of the probation period and the next day, he/she should be confirmed.

Regards,

Manohar

Hi there,

I am back with another problem. I have an employee who cut his hand during duty hours. We have paid for all the necessary medicines, stitch charges, etc., but now he demands that the 6 days that he was on leave be considered as special leave. He does not want us to deduct the same from his Sick Leave.

Is this feasible? Can I actually grant special leave which is not specified in the company policy?

Regards,
Annie

Ms. Anne,

As regards your query regarding the effect of the confirmation date on LTA, leave encashment, and gratuity, my views are as follows:

LTA: Normally, LTA is allowed only to a confirmed employee. So, to that extent, the first availment of LTA would be deferred.

Leave encashment: As per the Factory Act, an employee, on completion of one year of service, is entitled to annual leave with wages at the rate of one day for every completed 20 days of service. Therefore, the confirmation date should not pose any problem in this regard.

Gratuity: Gratuity is payable for every year of completed service starting from the date of the initial appointment. Hence, the period of probation is included in calculating gratuity.

However, the real effect would be on seniority/promotion purposes. When you are grouping the employees to a particular date, and if your seniority rules are based on the confirmation date, this process could create problems. I am unable to identify any other relevant factors.

Sorry for not mentioning the name before submitting. Have a happy HOLI. Regards, KK Nair

Dear Annie,

Unless the employee has injured himself during work and it arose out of the work assigned to him, you do not need to grant him leave. If he is a workman covered under the Workmen Compensation Act, then for six days of absence, he is entitled to half of the monthly compensation, i.e., half of his pay. In other cases, you are well within your rights to consider him absent if he does not apply for leave. I am concerned that if you give in to the pressure, there will be many more such incidents, and your concerns will only increase.

Regards,
Nair KK

Dear KKNair,

It seems that in the past such a practice was developed in this organization, so the employee took advantage of the same. I am new to the organization and am still in two minds whether I should ignore the same or grant him the "special leave."

Regards,

Happy Holi to you too,
Annie

Dear Annie,

Here is the test for you. If you want to stop this practice, this is the time; otherwise, you will also have to follow the time-honored tradition. But before jumping to say 'NO,' is your organization prepared to deal with the situation? Take a decision after evaluating the pros and cons.

Thank you,
KK Nair

Hi,

There is nothing wrong in altering confirmation dates. Many companies follow this trend. If a person has joined before the 15th of any month, his confirmation date is taken as the 1st of the month; if he has joined after the 15th, it is taken as the 15th of the month. We were also following the same policy. It is for convenience purposes.

Daleep

Hi Annie,

As per my knowledge, no two leaves can be clubbed together. We are also following the same rule.

Regards,
Pranita

Hi Annie,

You can easily resolve this confusion by adding a specific clause to your appointment letter stating, "Confirmation after the training shall be in writing, and until such written confirmation is provided, you shall continue in the capacity of a trainee."

Thanks,
Anita.

Dear Annie,

The question of changes in matters of LTA, leave encashment, and gratuity will only arise in my mind if you change the salary component (i.e., basic salary) upon the closure of probation (some companies do that - though in varying forms). If you follow a policy of giving an increment/increase upon confirmation, then my suggestion is to close the probation at the end of the month in which the probation would normally fall.

To give you a corollary example, consider retirements. You can retire employees from the day they attain the age of superannuation (which is done in some companies) or at the end of the month in which the employee reaches the age of superannuation (as is the case in most companies). The same logic can be applied - only keeping in mind that it must be mentioned in the general terms and conditions of employment.

I hope this clarifies your query. If you need more information or have further questions, please let me know.

Regards,
mxsingh

Hi,

You are doing the right thing. If the confirmation letter is delayed due to some other reasons, you have to compensate for LTA, Medical, or whichever is applicable to that employee after confirmation.

Regards,

Y. Venumadhava Reddy

Hi Mr. Nair,

I need a small help regarding Confirmation... Our company does yearly appraisals; however, it's not fixed. We don't follow any pattern as so far the number of employees was less than 50. But now the number of employees is 100+. Not having a fixed pattern is causing a lot of problems.

To address this issue, we are now planning to have two appraisals in the very first year (6 + 6 months) and then push them onto a yearly cycle. The concern is giving salary increments twice in a year. What I believe is if we can have fixed increments for every salary range, it might go a long way in solving the problem. If this would be the ideal solution according to you, can you suggest or share how we should go about fixing the salary increment for every salary range?

Please help!

Twinkle

Hi Twinkle,

First, you should fix the annual increments to March or April every year. If any employee has joined in the middle of the year after completion of probation, you have to streamline the annual increments. As far as the increments are concerned, if they don't reflect in the salary, it becomes a problem for you and the management. The best way is to divide them according to the cadre. For example:

- For Assistant Cadre:
- For Executive Cadre
- For Managerial Cadre
- For GM and above cadre, etc.

This approach allows for justification and should be decided by the company management. For any queries, please email me at reddy_venumadhav@yahoo.co.in.

Regards,
Y. Venumadhava Reddy

Hello Twinkle :icon13: :!: :icon13:

I agree with the views of Venu. You need not give an increment twice as the general understanding is 'annual increment'. About the rates, well, it varies on a scale-to-scale basis. A thumb rule you can adopt is to fix a particular percentage of the Min/median or max of the respective pay scale. Indeed, the quantum depends on how much you want to open the fist. So depending on your paying capacity, you decide the quantum. But remember, increasing the pay has long-term implications as your wage burden is going to increase further. OK :)

Regards, KK Nair

PF in case of trainees / contractual staff

Our trainees do not get PF benefits like the rest of us. Is this violating the PF Act? Same goes for contractual employees. Can you provide a loophole out of this problem?

Annie

Hi Annie,

As per my knowledge, CL & SL can't be clubbed. Casual leave means an employee can take leave if the reason for leave is casual in nature. For example, parents' meeting, going for a marriage, etc., whereas sick leave means when an employee is not feeling well.

Regards,
Deepa Singh

Hi Annie,

If a trainer/Contractual Staff's basic salary is less than 7501, P/F is liable. If you are paying a stipend to the trainer, then P/F is not applicable.

Regards,
Deepa Singh

Dear Deepa,

What's about Consultants? Is PF applicable to Consultants? If not, then the company may hire a number of consultants within a limited package up to 6500/- per month.

Regards,
Anand