Will special leaves become a necessity in the future?

In the post-COVID world, we are bound to see many changes in the way workplaces are organised. The future workplace may see a special kind of leave to prepare for situations, such as the current one.

There are national laws such as the Factories Act of 1948, which dictate the minimum number and the kind of leaves that employers are liable to provide. However, that is only for factories and dock workers. Other organisations — such as in the IT, hospitality and entertainment sectors — are covered under the Shops and Establishments Act, which is again specific for each state.

There are various kinds of leaves given to employees, such as earned leave (EL) also known as vacation leave, with the numbers varying from state to state. Others are casual leave (CL), maternity leave, paternity leave, compensatory leave and bereavement leave.

If the person has sick leaves in balance then she or he can use those first, and afterwards, the company can support the employee for the remainder of the duration

If employees use leaves in excess of what they have in the bank, then that comes under loss of pay (LOP) or leave without pay (LWOP).

A loss of pay amidst the current health crisis is the issue employees are struggling with.
However, few organisations are gearing up and coming out with provisions to tackle the situation.

For instance, Tata Steel has come up with a special provision in its leave policy to enable workers, who need to go under quarantine to do so without any fear of pay cut. Applicable to both blue- and white-collar workers, employees can utilise the leave for as long as they need, while other benefits such as privileged and sick leaves remain intact.

The Rama Prasad Goenka (RPG) Group has also come up with a similar provision to enable employees to take leaves without fearing a pay cut.

Is this an indication of how organisations will prepare for unprecedented disasters, such as this one, in the future?

Although the approach, going forward, cannot be stated with certainty, there are two possible ways in which crises, such as the current one, will be dealt with by companies.

Special leave or grace period

The first is that organisations may bring about changes in the leave policy and grant special leave for employees, with full pay. This will be a policy for extraordinary times. While for short a duration employees may use the available medical or sick leaves, this special leave will be granted for a slightly longer period of time.

These kind of situations are special and companies will provide special leaves as and when such situations arise and not from day one

However, there is no such thing as a free lunch. The catch will be that the special grant of leave will be for a limited time. For instance, a company may provide 30 days of special leave with full pay. Beyond that, employees may be asked to utilise their remaining paid leaves.

This is because, if we are talking about a situation similar to the pandemic we are facing today, companies are going to be under immense financial pressure. A company that is not earning cannot provide for its workers. In larger organisations, the employees may have to suffer a pay cut while in small organisations and startups, employees may be furloughed.

Take the example of the circular from the Ministry of Home Affairs (MHA) on March 29, directing all private establishments including MSMEs, to pay full salaries to employees during the lockdown. This circular met with much disapproval from organisations across the country. One of the main points of contest, in a petition filed by a manufacturing company, was that the Government had passed the order without due care and deliberation on the financial implications for the employers, which could actually lead to the closure of many units.

Leaves provided as and when needed

Few HR leaders are of the opinion that provision of extra leaves as a policy is not necessary. Instead, employees will be able to utilise their existing leaves, and if required, the company will provide them with required paid time off as and when required.

“These kind of situations are special and companies will provide special leaves as and when such situations arise and not from day one,” opines Anil Mohanty, head-HR, Medicabazaar.

Companies will need to look at how they are going to support their employees in case of any eventuality in the future

Either way, organisations will need to have a mechanism in place to take care of their employees.

Chandrasekhar Mukherjee, CHRO, Magic Bus Foundation, agrees that now companies will need to ensure they can take care of their employees, especially the junior ones. A junior employee who has recently joined the organisation may not have as many leaves in his pocket as a senior professional in the same company may have.

“If the person has sick leaves in balance then she or he can use those first, and afterwards, the company can support the employee for the remainder of the duration,” suggests Mukherjee.

Abhay Srivastava, chief talent officer, SVP-HR, Cipla, says, “Organisations will need to be more agile, empathetic and build a supportive culture.”

“Companies will need to look at how they are going to support their employees in case any eventuality in the future”, adds Srivastava.

Most organisations in the country, such as OYO, GoAir and SpiceJet, have been understandably unprepared for the current crisis and have been sending employees on leave without pay or handing out pay cuts such. Others are asking employees to apply for leaves. If the employees have already used up their paid leaves, then they will necessarily have to take a pay cut if they apply for further leaves.

Crises such as these put the culture and attitude of organisations into focus, through the steps they take for their employees. How their current and future employees will perceive them will depend on how they tackle the situation, while keeping in mind the ‘people’ aspect.