Management of leaves is among the most crucial HR processes that take up a tiny but significant part of managerial time. Although it does not consume much time, approval of leaves is a difficult task that requires balance. On one side, HR has to ensure compliance with the policy on leave and ensure there are enough resources to sustain the business, and on the other hand, it is required to increase employees’ satisfaction. In addition, we’ve all witnessed an uneasy relationship between the employee and the manager regarding the issue of leave, making managing leave an essential task for any company.

Strategic Benefits of Leave

Many companies do not consider leave management as a serious issue. However, research shows that ineffective control of leave has harmed the performance of the business. It could affect project delivery and affect the morale of employees. Here are some crucial business issues directly related to the management of leave:

The deadlines for project delivery: 

The availability of manpower directly affects the timeframes for project delivery. When committing to dates for delivery, managers must be aware of the availability of adequate resources. They should be aware of the time of peak leaves and be able to commit dates for the delivery accordingly. Additionally, when important projects are close to deadlines, they must approve the leaves with care.

Legal questions:

Every country has legal guidelines for employee leave. For example, FMLA, the Family and Medical Leave Act(FMLA) is a law in the United States – with its expansive scope of definitions of health conditions as well as large leave benefits – could make employers nervous, particularly small businesses that depend on a small number of important employees. In the event of not complying with the complex requirements of this law could be a serious risk for both individuals and companies. Similar to India’s FACTORIES Act, Chapter VIII: Annual Leave and Wages provides clear guidelines for taking leave. Failure to comply with these guidelines increases the likelihood of being sued by employees, and they may be penalized by government authorities.

Emotional aspects:

Getting leaves on time is a significant factor in employee satisfaction. Employees may have personal issues that necessitate their absence from work. Check out our other post on how denying leave can create emotional stress. We looked at an instance of poorly managed requests for leave.

The financial implications of this: 

Accrued leave is a financial burden for businesses, specifically the privileged and paid ones that require reimbursement when the employee is terminated or when requested by the employee following the policy on leave. If employees fail to use their leave in sufficient amounts, then the company’s financial burden increases. The HR department should be able to inform management of this at regular intervals.

Performance and. Leave: 

Work-life balance has an immediate impact on the performance of employees. Both employees who don’t take enough time off (and are stressed) and those who take too much leave (and do not pay attention to their job) negatively affect their productivity. Both types of employees require to be watched closely and trained on maintaining an effective life-work balance.

A) Leave trends: 

Many employees prefer to have a leave of absence during the holiday season. HR managers should be aware of instances when many employees request leave. These numbers aid managers make better decisions, particularly regarding the dates for the delivery of projects.

B) Employee availability:

 This is the number of employees available to work during the current quarter or at any time.

C) Employee leave balance:

This shows the remaining leave of different kinds for employees, both departmental and company-wide. This will help the finance department calculate how much-accrued leave liabilities are for the company at any given point.

D) Leave rejection:

This shows the number of leave requests rejected by the manager during the last six months. A rising number of rejects should be reviewed as they could affect employees’ morale.

(e) Leave acceptance: 

This indicates the number of leave days that have been approved by management during a certain time.

(f) Employees who have taken “no leave in the last quarter”:

This gives the employee list who has not taken any time off during the past quarter. Again, HR Managers must determine the likely causes and may even advise employees if they’re placing themselves under stress.

Technology’s role

Monitoring compliance or managing the data on leave can be a hassle when performed manually or using Excel. However, HR technology can greatly simplify the management of leave and provide value by streamlining the leave data of an organization. Here are some of the major challenges that an automated system for managing leave can solve:

Complete details: 

Provides accurate information about leave balances, leaves trends, etc., that allows you to anticipate the availability of resources at any moment in time.

Policy rules are conveyed: 

Uses in-built systems to transmit leave policy guidelines such as maximum or minimum days allowed and holidays calendar management based on where you are located, etc. Employees can anytime consult the policy on leave before requesting holiday days.

Respect for the leave policy: 

Often, a lack of understanding about the policies for leave at work, can lead to the omission of leave policy guidelines by managers and employees. The Leave Management System uses inherent rules that prohibit workers or supervisors from circumventing the rules while applying for or approving the use of leaves.

Instantly available information on employees’ Leave history allows 

Managers and HR personnel to examine the history of the left of the person applying. The left history of the department or the company is also available instantly.

Reduces your time 

Visibility of leave balance online can ease huge stress on HR. Up to 15 percent of their time focused on handling inquiries about the employee’s leave balance.

Enhances discipline

Leave coupled with an attendance record is a great way to improve the accuracy of attendance and create discipline within any company. Some companies, for instance, might have a policy of taking leave with no pay if an employee has been absent without the manager’s approval.

Multi-location holiday management

Leave paired with specific calendars of holidays for specific locations can assist in calculating the correct amount of days the employee is entitled to leave.