Employee Attendance and Leave
You need to keep track of employee’s leaves and attendance to ensure that they are productive. Employee attendance and leave management involve maintaining records of sick leaves and holidays. This ensures that payroll is completed without errors and and on time.
Employee attendance and leave data collection involved recording of approved leaves by managers, their daily attendance, each employee’s daily working hours, half days, overtime and working on National Holidays.
Leaves
It is mandated by Government that every employee is offered a total of 18 day leave in a year excluding Holidays and non-working days to employees.
The various leaves that are included in Typical Payroll are described below
Sick Leave
Sick leaves allow employees to recover from an illness and take care of their health. It is mandated by Labour Law and companies can choose eligibility criteria for same.
Casual leave
Leaves grated to employees for personal reason and short duration (1-2 days). This is dependent on Company Policy and no clear mandate is provided by the law for this leave
Maternity Leave
Maternity leave is provided to new mothers for 26 weeks. As per the Maternity Benefit Act, 1961, the employers have to provide 26 weeks paid leave to any women who have worked for at least 80 days in the 12 months. Out of the 26 weeks, up to eight weeks can be claimed before delivery. Organizations with 10 + employees are eligible for the establishment of this act including their women employees on a contract or permanent basis.
Paternity leave
Leave provided to the father-to-be. This is not a mandatory leave and depends on company policy.
Earned or Privilege Leave
Leaves provided to employee basis working for a certain duration and without any pay deduction. The number and eligibility vary based on company policy
Compensatory Leave
Leave offered to an employee who works on a non-working day.
Bereavement Leave
Leave offered to an employee in case of emergency/ unfortunate death of a family member.
Holidays
Weekly Holidays
Holiday given at end of working week (5day or 6 day). There is no specific mandate on this matter but Government states 9 hours daily working and maximum of 48 hours in a week.
National Holidays
National Holidays are the fixed holidays in India on January 26, August 15, and October 2 every year. These days are Holidays and if an employee works on these days, he/she is either offered a compensatory off or paid double wage for the day
Religious holidays
Religious Holidays given for Employees to be with their families on Key festivals. You need to provide a minimum of 9 Holidays in a year including National holidays, so 6 days are needed to be provided under this head
Loss of Pay (LOP)
When an employee avails leaves even when they have none left in their account, then salary will not be paid for these excess leaves. These leaves are termed as Loss of Pay(LOP) or Leave Without Pay(LWOP).
LOP Calculation
The calculation of Loss of Pay is based on the calendar day logic. You may also state that if an employee avails leave without approval, they will termed as LOP.
When deducting salary for Loss of Pay(LOP), the number of working days in a month impact the final deduction:
Loss of pay when days = 30
- Loss of Pay = INR 30,000/30 = INR 1,000 per day
Loss of Pay when days are calculated excluding Weekends
- 8 Saturdays and Sundays in a month
- Effective days = 30-8=22 days
- Loss of Pay = INR 30,000/22 = INR 1,364/ per day
You need to define the LOP policy and ensure employees are informed prior